11 4,5 million m3 purchased wood comes from preferred sources. All wood comply with our strict requirements on wood sourcing.550,000 solar panels installed & 157wind turbines installed and under installationSome of IKEA’s acheivements:€590 million allocated to invest in renewable energy, focusing on solar and wind, over the coming three years. More than 340,000 solar panels have been installed on IKEA stores and buildings across the world and we own/operate around 126 wind turbines.100% of our wood is sourced in compliance with our forestry requirements, and if it is not, we move quickly to address it. IKEA is also one of the biggest users of Forest Stewardship Council (FSC) certified wood, which is still in relatively limited supply. Over the past year we used around 2.2 million cubic meters of FSC wood, representing 16% of our total wood.The share of more sustainable cotton used in IKEA products is currently one quarter of our total cotton use. Working with partners such as WWF has helped around 100,000 cotton farmers to halve their water consumption and chemical pesticide use, and cut the use of chemical fertilisers by one third. More sustainable cotton also contributes to significant cost reductions and better earnings for the farmers. Results so far:Reduction of pesticides 50%Reduction of use of water resources 50%Reduction of use of chemical fertilisers 30%78% more cost effectiveTwo third of all cotton used is more sustainable.
13 Goals at IKEAWe will take a lead in turning waste into resources. We will develop key resource chains securing recycled materials, ensure key parts of our range are easily recycled, and take a stand for closed loop society. By the end of FY15 all main home furnishing materials, including packaging, will be either made from renewable, recyclable or recycled materials. Strive for zero waste to landfill wherever possible, with a minimum of 90% of the waste from our stores and other IKEA operations sorted for recycling by the end of FY15. By the end of 2020 to reduce the waste from our stores with 10% (kg/m3) compared to 2013To have material recycled 80 % of the waste from our operations by 2020Enable customers to have clear and simple options for the reuse and recycling of appropriate categories of IKEA products, e.g. mattresses, sofas, appliances and light bulbs.Target key raw materials with dedicated “resource chain” projects to establish new flows of recycled materials.By the end of FY17, 50% of the non-renewable materials used in our home furnishing products will be recycled materials.By FY20, 30% of the wood used by the industry group will be recycled.
15 How does it look like in society Recycling system characteristicsBottom up system business that has developed in response to raw material scarcity and high demand rather than by policy interventionHighly commercial system with profitability being the main driver and monetary transactions taking place at every step in the value chainWidely policy driven system with well developed infrastructure, recycling targets and standards (e.g. quality and labeling)Industrial and technologically advanced recycling for high value materials, such as metals and pre consumer plasticsBottom up system build on voluntary engagement of the consumers and ‘green’ lifestyle rather than monetary incentivesRecycling rates for common materials*MaterialCountryEUChinaPaper(a)60%40-50%Cardboard70%80%Steel75%Aluminum90%Plastics(b)15-20%22%Glass(c)50-60%20-30%Wood(d)67%70-80%Textiles(e)25%<1% (<1%)Excluding ”recycling abroad”, b. Post-consumer plastics, c. Glass containers, d. Including energy recovery, e. Post consumer, material rec. (collection)* Accenture analysis and multiple (>10) cross checked third party written sources (e.g. EU commission, BIR, World Bank, Ouvertes project)
16 Material prioritization Example of MATERIAL MATRIXTransformational potentialWood (67)Plastic (15-22%)Textile (25%)Apply best practiceCardboard (70-80%)Steel (60-75%)Aluminum (90%)CeramicsGlass (20-60%)Paper (40-60%)HIGH POTENTIALLOW POTENTIALLOW RECYCLE RATEIN SOCIETYHIGH RECYCLE RATEIN SOCIETY
18 A sustainability opportunity must economically sustainable Economic opportunityVirginMaterialCostCollection Cost(Including material dumping fee)Sorting and pre-treatment CostProcessing and recycling production costAdditional production costs due to use recycled materialRecycledMaterialCost
19 CE100 Circular Economy 100 Members ADBA AeroFarms Antea Group AQUAFIL S.p.A.BTChervon GroupClosed LoopDessoEcovativeEnvironcomFLOOW2Hennes & Mauritz ABiFixitIKEAInnoverneKingfisherM&SMicromidas Inc.Midal CablesNational GridNational Physical LaboratoryNespressoPhilipsRagn-SellsRecoupRegion of WalloniaRenaultRicohRoyal BAM GroupRoyal DSMSAB MillerScottish GovernmentSelfragSGW GlobalTarkettTerraCycleThe Agency of DesignThe Coca-Cola CompanyTurntooUnileverVeolia EnvironmentVestas Technology UK LtdWalloniaWm Morrison Supermarkets PLCWRAPZerobin
21 IWAY at all suppliers 170,000 audited improvements! 100 million childrenThe IKEA Foundation donated €65 million in 2011, helping children in more than 30 countries.Encourage suppliers to move from a compliance-driven approach to one based on shared values and a commitment to sustainable business. Work together with our suppliers to ensure their operations are the best places to work in each sector and local market, offering working conditions that ensure they attract, motivate, develop and keep the talent they need.Since our code of conduct for suppliers, IWAY, was introduced in 2000 we have seen more than 170,000 audited improvements in environment and working conditions in supplier factories around the world. In the past year, more than 1,000 audits, over 700 of which were unannounced, were carried out in supplier factories.Go beyond the immediate reach of our supply chain and contribute to transforming entire sectors, such as cotton, and create positive change in society or addressing wide spread challenges such as the impact of migrant work on families and children.We invested €1.9 million in FY12 in sustainable cotton farming projects, reaching more than 100,000 farmers.With support from the IKEA Foundation, UNICEF has improved children’s health, hygiene and education in India:3.6 million children are receiving quality education in more than 18,000 schools across six states4.9 million mothers have started breastfeeding their new-born babies within one hour of birth32 million homes now have toilets8,000 community groups came together to collectively protect children’s rights1.1 million schools now have toilets, hand-washing facilities and safe drinking waterBUSINESS PLAN FOCUS WEEKS FY14-16