8 th European Forum on EcoInnovation Bilbao Spain

8 th European Forum on Eco-Innovation, Bilbao, Spain 20 -21 April 2010 Making Eco-Innovation happen in Small and Medium-Sized Enterprises Greening the Supply Chain Olle Blidholm Development Manager, Group Staff Sustainability, IKEA Olle Blidholm, IKEA, Sweden

FACTS ABOUT IKEA • 21, 5 billion Euro sales • 123. 000 co-workers • 267 stores in 25 countries • 1 220 Suppliers in 55 countries • 46 factories in 10 countries • 39 distribution centres in 17 countries

SALES AT A GLANCE Top five sales countries Sales by region Asia & Australia 5% North America 15% Europe 80% Germany USA France UK Italy 16% 11% 10% 7% 7%

PURCHASING AT A GLANCE Top five purchasing countries Purchasing by region China Poland Italy Germany Sweden 20% 18% 8% 6% 5% North America 3% Asia 30% Europe 67% 1, 220 suppliers in 55 countries

OUR SOURCING MODEL • Global purchasing organisation working in material dimensions • Local purchasing offices and close co-operation with suppliers • Aiming for long-term relationships with suppliers sharing our values • Code of Conduct launched the year 2000

SUSTAINABILITY IN IKEA • One of four cornerstones in our long-term corporate strategy for 2015 • Aim to take a holistic approach • Innovation and new smart solutions is key - new products/solutions - logistics - manufacturing - raw materials

SUSTAINABILITY PRIORITIES 1. Offer a range of products that are more sustainable 2. Have a leading role in a low carbon society and strive to be overall climate positive 3. Turn waste into resources 4. Take social responsibility

DEVELOPING SUPPLIERS Basic demands Development • IWAY, our Code of Conduct • Supplier energy efficiency project - environment - working conditions - social conditions - forestry • Water • Innovation platform for suppliers

WWF CLIMATE PROJECTS Climate Positive Opportunities for Suppliers Main Goals Goal 1. Identify and analyze the most important barriers that obstruct change Goal 2. Define strategies to open opportunities Goal 3. Create an action plan based on the defined strategies Goal 4. Create a Supplier Innovation Platform

THE IKEA INNOVATION PLATFORM IKEA Suppliers IKEA units: Stores, DCs, Swedwood IKEA Coordinator The IKEA Global Innovation Platform Plastics Innovation Partnership General Climate Innovation Partnership Supported by WWF Textiles Innovation Partnership Best Available Emerging Tailored Technology solutions BAT Emerging Tailored solutions Mattresses Innovation Partnership BAT Emerging solutions BAT Tailored solutions Emerging Tailored solutions

CONCLUSIONS • Sustainability is core business for IKEA • We aim to take a holistic approach • We work to fully integrate sustainability in all our business strategies • Innovation is a crucial part in this - Green living - Logistics - Manufacturing - Raw materials

WHAT DO WE WANT? • Clearer and tougher rules • A solid climate agreement that prevents harmful trade barriers • A comprehensive approach to cross boundary rail traffic • Clear long-term rules and subsidies for renewable energy • Various incentives promoting the development of new innovations and resource efficient technologies

8 th European Forum on Eco-Innovation, Bilbao, Spain 20 -21 April 2010 Making Eco-Innovation happen in Small and Medium-Sized Enterprises Olle Blidholm Development Manager, Group Staff Sustainability, IKEA Tel +46 732 320 105 olle. blidholm@ikea. com Olle Blidholm, IKEA, Sweden