IKEA Future-Proofs its Brand, From Meatless Meatballs to Wind Turbines


Swedish retailer IKEA sold 97.4 million meatballs last year, a mash-up of beef and pork which accounted for a hefty portion of 600,000 tons of carbon dioxide emissions. While amounting to only about 2% of the company’s overall carbon footprint, it’s still too much for the global brand that’s made a name for itself as delivering good design and function at affordable prices.

“We didn’t want to have 5% of our range ‘green’ and ignore the rest,” commented Steve Howard, IKEA’s chief sustainability officer, to Fast Company. “If we think of the challenge—society is using 1 ½ planets’ worth of resources every year, and on track for more—business as usual isn’t an option. Sustainability has to be in every product in every customer’s home. It shouldn’t be a luxury for the few.”

So IKEA is putting its money and corporate citizenship on the line, from reconstituted chicken and vegetarian meatballs to solar panels, assembling a bold and proactive sustainability program to ‘future-proof’ its brand.[more]

It just made its first U.S. wind-energy investment, acquiring a 98-megawatt wind farm in Hoopeston, Illinois with 49 wind turbines to be fully operational by early 2015. The purchase is not intended to supply IKEA’s 38 U.S. stores with energy but “is part of IKEA’s goal of becoming energy neutral—that is, not using any more energy than it’s able to produce.”

“The Illinois wind field will supply energy equivalent to 1.3 times IKEA’s total U.S. electricity and other energy use,” observed the Wall Street Journal. “Put another way, it will generate enough for the average energy needs of 34,000 American households annually (and) catapult IKEA’s renewable-energy production to two-thirds of global energy consumption, from 37% currently.”

IKEA has already installed nearly 550,000 solar panels on its buildings in nine countries and claims to be the No. 2 private commercial owner/user of solar power in the U.S. trailing Walmart as the No. 1 solar-power buyer.

While Walmart relies on ‘power-purchase agreements’ buying from renewable energy suppliers, IKEA owns 100% of the solar panels, geothermal-energy facilities and wind farms it uses in an end-to-end commitment. “People come in to buy towels and leave with solar panels,” said Howard to Fast Company. “That’s not aggressive upselling, that’s a fantastic deal where those people will get a 13% or 14% payback on the solar panels they’ve installed.”

Companies including IKEA, BT, Capgemini, Coca-Cola Enterprises, the Crown Estate, Kingfisher, and SKF have agreed that “current response to the challenges we face is inadequate,” The Guardian reports. “Net positive offers business and others a way to turbo charge ambition levels; to rebuild nature’s dwindling assets and rebuild social capital, in a way that delivers value, today and tomorrow. Net positive could drive a truly restorative economy.”

From meatballs to solar-panels and wind-energy, IKEA is forwarding a sustainable ethos proving that doing right is good business. Trialing products with its employees, IKEA is sending them home with energy-saving induction cookware or food storage containers that reduce food waste, or new packing materials for its iconic assembly-required furniture, striving to engage them as sustainability ambassadors.

“I’m convinced we are in the middle of this clean revolution right now, but I’m also not convinced we are doing it fast enough,” said IKEA CSO Howard to Fast Company. “All the challenges are solvable with the solutions we have today, but we don’t have the right leadership, policies and priorities in place. Most political and business leaders are in a state of denial. Sustainability will be a decisive factor in terms of which business will be here in 30 years time. It’s also the future of business.”

Connect with Sheila on Twitter: @srshayon