How IKEA Embraces Sustainability Globally and in Singapore

By , Green Business Times, May 24, 2011,

Over 7 million people visited the two IKEA stores in Singapore last year. Singaporeans love IKEA for its affordable and well-designed home furnishing products, but not many realise that IKEA is also committed to sustainability.

At Green Business Times, we have always admired how IKEA conduct business while keeping in mind their environmental and social responsibilities. To give you an overview of how IKEA embraces sustainability, we will share with you the efforts of the IKEA Group and IKEA Singapore.

1. IKEA Group

In 2010, the IKEA Group has a total of 316 stores in 38 countries, and employs 127,000 co-workers. As a large organisation, IKEA has bigger responsibilities and impacts. IKEA’s commitment to people and planet is evident in their recently published IKEA Sustainability Report 2010. In the words of Mikael Ohlsson, President and CEO, IKEA Group:

The IKEA vision is to create a better everyday life for the many people, and we believe that home is the most important place in the world. We offer affordable home furnishing products and solutions, while also taking responsibility for people and the environment. We want our customers to be able to freely choose from our range, knowing that they do not have to choose between sustainability, style, function or price.

Here are some highlights from the IKEA Sustainability Report 2010:

IKEA Sustainability Direction 2015

The IKEA Sustainability Direction 2015 outlines IKEA’s priorities and goals for 2015:

1. Offering a range of products that are more sustainable

  • 90 percent of our sales value shall come from home furnishing products classified as “more sustainable” in the IKEA Sustainability Product Score Card.
  • All materials for home furnishing products shall be renewable, recyclable or recycled.
  • Our energy-consuming products shall on average be 50 percent more efficient than what was installed on the market in 2008.

2. Taking a leading role towards a low carbon society

  • By being innovative, energy efficient and using more renewable energy, we shall significantly reduce CO2 emissions from our own operations, the supply chain and customers travelling to IKEA stores.
  • We shall help reduce CO2 emissions in society by offering products, solutions and know-how that enable our customers to reduce their carbon footprint and live a more sustainable life at home.
  • We shall actively participate in developing tools to measure a company’s positive impact on the climate.

3. Turning waste into resources

  • We shall have zero waste to landfill from our own operations.
  • We shall enable and encourage customers in all markets to reuse or recycle all IKEA products at end-of-life.

4. Reducing our water footprint

  • We shall significantly reduce our water footprint in our own operations as well as throughout our supply chain.

5. Taking social responsibility

  • All our home furnishing suppliers and transport service providers shall comply with all requirements in our code of conduct, IWAY. (FY2012)
  • The global index average in the annual co-worker survey VOICE shall reach 700 or above out of a maximum of 1,000.
  • The IKEA Foundation funded projects shall reach more than 100 million children.
  • All IKEA units shall have a clearly defined plan for community involvement based on our Charity Policy.

IKEA Sustainability Product Score Card

The IKEA Sustainability Product Score Card is a new internal tool introduced to help IKEA classify and offer more sustainable products. The Score Card includes 11 criteria that have an impact on a product’s sustainability throughout its life cycle, including:

  • More from less (using less material in the product)
  • Renewable material
  • Recycled material
  • Environmentally better material
  • Separable and recyclable material
  • Product quality
  • Transport efficiency (number of products per container)
  • Energy efficient production
  • Renewable energy in production
  • Raw material utilization at suppliers
  • Product use (less use of energy and water, and less waste in customers’ homes)

The IKEA Sustainability Product Score Card is an internal tool that will help IKEA measure their progress and improve the sustainability of their products. There will not be product labels for customers to read the scores. IKEA does not display eco-labels (internal or external) on their products and only display the IKEA logo, as they want their customers to know that the IKEA logo already stands for safe and sustainable products.

The IKEA Way on Purchasing Products, Materials and Services (IWAY)

IKEA requires their suppliers of products and services to follow the IKEA code of conduct, called The IKEA Way on Purchasing Products, Materials and Services (IWAY), which was first introduced in 2000. The IWAY states the supplier requirements relating to the environment, child labour, social and working conditions.

Suppliers are responsible for communicating the content of the IWAY to their employees and sub-suppliers. Suppliers must also comply with a list of IWAY start-up requirements before being allowed to work with IKEA, and are given one year to implement the other IWAY requirements.

Read the IWAY standard.

Forestry

Wood is an important raw material for IKEA, so all IKEA solid wood and board product suppliers must follow the IKEA code of conduct IWAY and the IKEA Forestry Standard. The minimum criteria for wood products include:

  • Not from forests that have been illegally harvested
  • Not from forestry operations engaged in forest related social conflicts
  • Not harvested in uncertified Intact Natural Forests or other geographically identified High Conservation Value Forests
  • Not harvested from natural forests in the tropical and sub-tropical regions being converted to plantations or nonforest use
  • Not from officially recognised and geographically identified commercial Genetically Modified tree plantations

In addition, IKEA’s long-term goal is to source all wood from forests verified as responsibly managed (or known as preferred sources). IKEA currently only recognises the Forest Stewardship Council (FSC) certification scheme. The goal is to have 35% of IKEA’s solid wood volumes from preferred sources by the end of FY2012 (up from 24% for FY2010).

Cotton

Cotton is another important raw material for IKEA, so IKEA is increasing the availability of sustainable cotton by encouraging cotton farmers to introduce more sustainable farming practices.

IKEA is one of the founding members of the global Better Cotton Initiative (BCI), and has set the goal for all cotton used for IKEA products to be produced according to the social and environmental criteria developed by BCI by FY2015.

Water

IKEA wants to minimise the water footprint (see figure below) throughout its value chain, and is helping cotton farmers in India and Pakistan to reduce their water consumption significantly through the introduction of better management practices.

 

The IKEA code of conduct, IWAY, includes requirements on water discharges and treatment, and also requires suppliers to reduce their environmental impact such as water usage.

In addition, IKEA stores and distribution centres measure their water use and have implemented various measures to reduce water consumption.

Waste

IKEA wants to minimise waste throughout its value chain and have set goals to have zero waste to landfill from their own operations, and to enable and encourage customers to reuse or recycle all IKEA products at end-of-life, by FY2015.

All IKEA stores and distribution centres recycle waste material, including cardboard, paper, plastic, wood, metal and glass. IKEA also minimises the amount of waste generated in the manufacturing process or uses it in the production of other products if possible. In addition, IKEA started a project called “Closing the loops” to investigate the opportunities for full recyclability of different materials used in IKEA products.

Climate

IKEA wants to reduce its carbon footprint (see figure below) from all aspects of its value chain. All IKEA countries have to develop reduction goals for energy consumption and carbon emissions for their stores, distribution centres and factories, based on the long term direction that all IKEA buildings should run on 100% renewable energy and that energy efficiency should improve by 25% compared to 2005.

 

IKEA is working with suppliers in energy projects to help them reduce energy consumption and carbon dioxide emissions, while saving costs. IKEA is also helping customers and co-workers use more sustainable modes of transport to travel to and from IKEA stores.

2. IKEA Singapore

To understand more about how IKEA Singapore embraces sustainability, we visited the IKEA store at Tampines recently and met up with Ms Joycelyn Teo-Moser, Sustainability Manager, Ikano Retail Asia, and Ms Sandra Keasberry, Assistant Manager, Marcom, Ikano Retail Asia.

In Singapore, the two IKEA stores at Alexandra and Tampines are owned and managed by Ikano Pte Ltd (Ikano), a franchisee of Inter IKEA Systems B.V. located in the Netherlands (the owner and franchisor of the IKEA Concept). Ikano also owns the IKEA stores in Malaysia and Thailand.

Although Ikano is not required to adhere to the IKEA Sustainability Direction 2015 set by the IKEA Group, Ikano is still committed to align and integrate its own practices and operations towards sustainability and IKEA’s direction. The IKEA home furnishing products provided by Ikano would also meet the IWAY code of conduct and go through the IKEA Sustainability Product Score Card.

Here are some green and social initiatives found in the offices and stores at IKEA Singapore:

Office and Co-Workers

There is an emphasis on sustainability education and awareness for co-workers, and they go through a sustainability e-learning programme. There is a handbook on sustainability and waste sorting processes in place for the co-workers to ensure that their backend practices are sustainable and all waste are discarded responsibly. The notice boards in the office also constantly update the co-workers on environmental and sustainability programs, news and generate awareness.

In the office, there are recycling bins for easy sorting of materials, and reminders on switching off lights after use. Co-workers are encouraged to print less and use email instead. FSC-certified paper is used for printing and namecards. There are also bicycle lots for co-workers.

 

Material Reduction and Recycling

  • Waste packaging material such as wood, carton boxes, plastics, and metal are sorted for recycling.
  • Recycling bins are placed throughout the store.
  • Some carton boxes are given to schools for art projects.
  • Waste fabrics are given to the organisations and nearby schools for charitable causes. These organisations use these waste materials and convert them into useful products, which they could in turn sell to gather funds to support their causes.
  • Ikano is a signatory to the Singapore Packaging Agreement and was a Distinction Award Winner at the 3R Packaging Awards 2010 for their efforts in reducing packaging waste.
  • All the waste oil, about 3,000 kg per month, from both restaurants are sent to Alpha Biofuels to be recycled into biodiesel.
  • Food waste used to be sent to IUT Global for recycling to produce biogas, but recently the recycling programme has stopped due to the closure of the company.
  • The IKEA restaurants have also stopped providing takeaway boxes to minimize the usage of disposal packaging. Currently, only IKEA Alexandra sells the take-away boxes, when requested by customers. The proceeds from the sales of the takeaway boxes from IKEA Alexandra is donated to WWF Singapore to support local conservation efforts. Biodegradable cornware containers and utensils are also used.

Say “NO” to Plastic Bags

Since April 2007, IKEA Singapore has stopped giving out free plastic bags. It was the first retailer in Singapore to do so. About 45.5 tonnes of biodegradable plastic bags were saved between July 2009 to June 2010, and this translates to about 2,148,000 plastic bags saved per year.

The proceeds collected from the sale of the plastic bags from April 2007 – May 2010 go to WWF Singapore to help fight the haze in Sumatra, by promoting sustainable forest management and developing alternative sustainable livelihood for the villagers.

From May 2010, the proceeds go to the Little Green Dot student research grant, jointly organised with Nature Society (Singapore). The grant allows students to conduct research on methods of conserving marine and freshwater life.

As-Is

Furniture that are returned, damaged or ex-display are given a new lease of life and sold at the As-Is corner at reduced prices, to maximise reuse.

småles

The småles programme is for IKEA Singapore to engage kids through fun activities, news and games. The young children also get to know more about green issues, and can also receive points for bringing used newspapers to the stores. The newspapers are reused for customers to wrap their products.

IKEA Catalogue

Local printers are selected by Inter-IKEA Systems using the IKEA Catalogue Sustainability Requirements, and all catalogue suppliers are required to document data on fibre sourcing and use, water and energy consumption, and emissions to water and air.

Customers can also view the catalogue online and opt-out from receiving the mailed copies by contacting Ikano.

Saving Energy and Water

  • The air-conditioning temperature in the store is kept at 24.5°C
  • On weekdays, the lighting for one level of the carpark at IKEA Tampines is switched off
  • Using daylighting for the warehouse
  • Taps are fitted with water saving aerators

Incandescent Light Bulbs

IKEA Singapore will begin to phase out all incandescent light bulbs and targets to completely eliminate them by 2012. It is also providing a range of energy-saving CFL, halogen and LED light bulbs for customers.

Parking Lots for Bicycles and Electric Motorcycles

To encourage emission-free transportation to IKEA, bicycles lots are available in IKEA Tampines. There is also a parking lot for charging electric motorcycles.

SUNNAN Lamp Campaign

For every SUNNAN solar powered lamp sold in IKEA, one lamp will be given to UNICEF to distribute to children living in the areas without access to electricity. The SUNNAN lamp is designed to resist the wear and tear of difficult living situations, and combines low-energy LED technology with solar panels.

Soft Toy Campaign

IKEA Singapore also participates in the annual soft toy campaign “One Euro is a Fortune”, which run each year in November and December in both Alexandra and Tampines stores. For every soft toy sold, the IKEA Foundation, the charitable function of IKEA, donates 1 euro to UNICEF and Save the Children projects to extend and start new children educational programs in developing countries.

The Never Ending List

The Never Ending List consists of a list of all the improvements IKEA has made to benefit people and the environment.

At IKEA, globally or in Singapore, there is a commitment to continuously making environmental and social improvements at every stage of its value chain. At Green Business Times, we like this attitude towards sustainability and would encourage more companies to follow this more enlightened way of doing business. Just like The Never Ending List, the sustainability story for IKEA or any company should be a never-ending one.

Source: IKEA Sustainability Report 2010IKEA Singapore.

Images: IKEA Group (IKEA Sustainability Report 2010 image; IKEA water footprint image; IKEA carbon footprint image); Ikano Pte Ltd (The Never Ending List images)

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