INGKA CEO Jesper Brodin on why IKEA’s food offerings are more than complementary to the core business, and how the Swedish furniture giant is making its products more sustainable.
00:00 Welcome Jesper to New York. I know you're here for Climate Week.
00:03 So why don't we start with a few questions about IKEA and its plans for sustainability.
00:08 So 2030 is only six years and four months away.
00:13 Not to put pressure. Are you sure, still sure you can be climate positive by that deadline?
00:18 So, you know, I think sure is maybe, to be humble, it's not how we see it, but we have good plans.
00:27 And in our initial plans, which was actually drafted already at the COP in 2016,
00:34 when the climate agreement was presented, was probably one of the first corporate climate plans out there.
00:40 We were supported by World Resource Institute, science-based targets.
00:46 And the climate plan for us basically to take us to positive means we address what is referred to as scope three.
00:54 So it's everything from the forest to the consumption of our consumers.
00:57 And actually, what is even more important for us is to hit a 50 percent target in the so-called scope three activities.
01:06 It is a bit technical, but at the bottom of this means that we need to, all of us need to,
01:11 make sure we reduce about half of all the carbon emissions that we have by 2030.
01:17 Is it within our reach? Definitely.
01:20 Let me ask you a philosophical question. Can we have thriving economies in the industrial world
01:26 while being less consumeristic? Because it seems to me that the only way we're going to
01:31 hit climate goals is collectively to be a bit less consumeristic. So can we solve a thriving economy?
01:36 Thank you. I think thank you for asking the question. It's an incredibly important, a very common question that I think
01:43 any one of us as consumers are asking ourselves.
01:46 And it leads us to the answer is absolutely. And it's not only a philosophical question, but I would say a metric and practical question.
01:54 So if you take the opposite angle, if you would explore that, by 2050, we need to reduce by 90 percent the carbon footprint. 2030, 50 percent.
02:05 If the only mode for us would be to limit consumption,
02:11 all of us can do the math, 90 percent less consumption in an expanding population of the world doesn't seem realistic
02:18 to any extent of food or necessities of life or what not. So that means that in order to deliver to Paris, which we all need to do,
02:27 we actually have to address consumerism itself and building circularity, energy solutions, mobility into what we call scope three.
02:37 And that is actually what we're busy right now doing.
02:40 So when I think of IKEA products, obviously they're popular and they're popular with people in their first homes and beyond.
02:47 But is there something that can be done to the products or maybe you are doing that to make them more desirable, say, in the secondary market
02:53 so that they have a second and third life as traditional furniture is?
02:57 So I think actually back in the early 2000s, we did a project around quality.
03:03 At those days, we looked ourselves in the mirror and we saw that our quality was uneven, so to say.
03:10 And that also included that the way we had engineered the products was mainly for assembly ones.
03:17 But in fact, already then and even more so these days, we typically have a bigger market share in any given market in the second hand market than in the first time.
03:28 And it's quite logic when you think about it, because a lot of the products in IKEA is related to a life situation that is limited to certain years.
03:36 It might be a changing table for a baby.
03:39 It might be the things that you, necessities of life when you move to your first student apartment or things that fits different life situations.
03:47 So IKEA's share in second hand is actually bigger than in the first hand market.
03:52 We are working with the second life in our own stores.
03:55 Every IKEA today store has a circular shop where we bring back products and we work with different modes of actually stimulating second hand use.
04:03 What's the role of artificial intelligence in simplifying putting your products together for people?
04:11 This is an absolutely exciting and delicate question at the same time.
04:16 So I think at the moment we are basically speed learning about AI.
04:21 It was as late as in January when I myself had a bit of a wake up call, not only to the opportunity side, but the risk side of AI.
04:30 So we are actually right now the biggest, we're taking our top 500 leaders through a program that will be concluded by Christmas, where we basically educate ourselves, explore opportunities, challenges.
04:44 We look being IKEA also from an ethical point of view, what are the borderlines for our engagement with AI?
04:51 And then how do you use that as a leader?
04:53 As for now, I think probably, and I say that humbly because we're still exploring, the first line of AI intervention for us will be tailor made solutions with specific tasks to maybe reduce waste, to enable better understanding of consumers behaviors and so forth.
05:13 In that space, I don't think there are generative models fit for our business.
05:18 So we are there by exploring how can we actually use it for our own benefit.
05:22 Let's talk about hot dogs.
05:23 The plant-based hot dog.
05:24 Is that turning out to be popular?
05:26 And can we have a plant-based?
05:27 Well, I was actually responsible.
05:30 I was working with the range, including food.
05:33 It must have been back in 2012 or 13.
05:36 We had a moment where we collected the whole value chain around food.
05:41 Food for IKEA is a complementary business to help people to basically stay with us for a good day out.
05:48 And we woke up to realize we're actually one of the big food providers of the world with a responsibility beyond complementary, so to say.
05:57 So those days we actually drafted a strategy together with our suppliers, NGOs, and where we educated ourselves both on the climate impact and the health aspects of food.
06:10 And being a meat lover from my youth, I realized I had a lot of learnings on the impact on both of myself and of course, my surroundings.
06:23 Since then, IKEA has been progressing with striving for plant food offers.
06:28 And there's been two aspects, that the taste and the experience is as good or better.
06:35 And then that we managed to actually make it affordable for people.
06:38 So the first was the veggie bowl, then came the plant bowl.
06:42 The veggie dog has been an alternative and now comes the plant dog.
06:47 It's being scaled out as we speak.
06:49 And for myself, it's actually interesting because when I do blind tests of a plant dog and a hot dog, I couldn't sense the difference.
06:59 And I do believe that's a true breakthrough because intellectually, I'm a vegetarian and it's down here that I sometimes struggle.
07:07 And I think there are many people like myself.
