DOver the last decade, we have become painfully aware that the climate crisis is no longer a distant threat but a living reality. It affects millions of people every day. Last year, the world exceeded 1.5°C of warming above pre-industrial temperatures for the first time – a milestone that reminds us of the urgency of action. Now, every part of a degree counts. Every year we can win in action will count. Every leader who takes responsibility will matter.
Today, 68% of IKEA customers worldwide see climate change as the biggest threat and worry about our future. The numbers, collected during a 2023 survey, vary less from country to country than you might think. At the same time, only 6% of customers are prepared to pay more for sustainable products and solutions. Don’t make the mistake of assuming that people don’t care. The truth is that most people simply cannot afford to pay more. They expect policy makers and companies like ours to find solutions that are affordable and sustainable. And they have the right to do so. Sustainability cannot be a luxury for the few.
As the leader of a multinational business and father of three, I see three reasons to be part of leading the transition to a climate-smart future. To begin with, based on today’s facts and awareness, we simply cannot afford to pass this on to the next generation. Second, it’s clear that our customers and partners around the world expect us to lead the way. People will write off brands that don’t. The expectation is not for perfection, but for sincere intentions and impactful actions. Third – here comes the good news – this is great for business. All in all, smart climate means smart cost. Waste has always been expensive and every step of building a sustainable business model has a positive impact on finances. Some actions are quickly rewarded. Some take time. Like any other investment.
As we experience the pain of today’s climate impacts and hear justified concerns about our future, we must mobilize our optimism. It is true that we are not on track with the Paris Agreement target of limiting global warming to 1.5°C. It is true that the trajectory is currently towards 2.5-2.9°C of warming by 2030 which will have disastrous consequences if it becomes a reality. At the same time, it is also true that we have already reached peak per capita carbon and we have it in our power to reduce emissions in total soon.
As a company, we are committed to the Paris Agreement—we must halve our greenhouse gas emissions by 2030 and reduce them by 90% by 2050. This means Scope 1 emissions in our operations, scope 2 indirect emissions and scope 3, which covers emissions from the entire value chain – from raw material, production and transport to customer use and end of product life. And it works.
Since 2016, our base year, we have managed to reduce our climate footprint by 30.1% across all areas, while growing business by 23.7%. To help achieve this, we have invested more than €4.2 billion in renewable energy abroad since 2009. We are also investing around €1 billion in companies that are working to increase recycling infrastructure. And efficiency measures have helped us reduce our energy bill by €97 million—or 29%—compared to five years ago. Meanwhile, we have halved our operational food waste across our business. Reducing waste, switching to renewable energy, and supporting our customers to save water, waste, electricity and money are all part of a long-term perspective that is resource smart, climate smart and ultimately business smart .
And we are not alone. Take a look at the World Economic Forums Alliance of Climate Leaders, which has more than 130 member companies. Over the past three years they have collectively reduced absolute carbon – across all three goals – by 10% while growing their business by 18%, outpacing global GDP. It is not enough, but it proves that we are on the right track. Just a few years ago many of us leaders made decisions based on faith. Today we know for a fact that our changes and investments will pay off – for people, for the planet and for business.
So what’s the problem? We are not fast enough and there are not enough actions. With five years to go until 2030, we find ourselves halfway through the most important decade for climate action. All parts of society including small and large companies must act for their influence. We all need to get our house in order by knowing our carbon footprint and taking action. We need stronger and more solution-oriented collaboration between policymakers and corporate leaders to set the framework for the smart climate economy. We must accelerate change – the clock on this crisis is ticking. We also need to share our successes. Confidence is always low for the wrong reasons. Greening and deliberate misinformation are unacceptable, but silence from the best actors is an even greater risk. And, we must be leaders for the future. We all need to take a bigger role in collective change.
We must challenge the myths that stand in the way of action. We have the solutions and the money to move to net zero. The risk is not only losing the benefits of the new economy, but also suffering economic losses. According to a recent report by the World Economic Forum, the cost of inaction will be in the region of 10-15%, annually. The biggest danger as a leader is knowing you could have done something but didn’t.
It’s good business to be good business. It costs smart. It’s a smart resource. And it’s climate smart. Let us own responsibility, lead by opportunity. Think about it: we are the first generation who can be part of creating a sustainable future that is good for people and the planet. This inspires me. I hope it will happen for you too.
Jesper Brodin is CEO of Ingka Group I IKEA, chairman of Team B, co-chair of the WEF Climate Alliance and co-chair of the UN Global Compact