Furniture giant IKEA is investing in ways to bring down its carbon emissions. We dig into the company's efforts to grow its EV fleet, build renewable energy infrastructure, and offer more sustainable products.
IKEA is one of the largest furniture retailers in the world with more than 450 retail stores in 60+ countries. Known for its minimalist Scandinavian designs, the company generates sales and loyalty through its relatively low-priced furniture and large, experiential stores.
The company’s bulk-produced, flat-packed, self-assembly furniture helps cut costs for the retailer via economies of scale and efficient use of shelf space. While the low prices are attractive to consumers, some critics perceive the company as a “fast furniture” brand selling borderline disposable products.
IKEA — founded in Sweden in 1943 — is now facing rising pressure to become more sustainable. Governments across the world are challenging corporations and companies to reduce CO2 footprints. The EU, for example, is aiming to reduce CO2 emissions by 55% across industries by 2030. Reflecting this trend, IKEA has laid out a plan to bring down emissions across its value chain, from materials to product use, by 50% by 2030 and achieve net-zero emissions by 2050.
The furniture maker is certainly not alone when it comes to prioritizing CO2 reduction as part of its medium- to long-term strategy. Discussions on decarbonization and reduction of CO2 emissions have surged in company earnings calls in the past two years. Consumers are also indicating they are prioritizing more sustainable companies and goods. In 2021, the World Wildlife Fund (WWF) reported that there was a 71% rise in online searches for sustainable goods globally. Recent studies have also shown that a decent proportion of consumers are willing to pay more for sustainable goods or services.