State of Green Business

Why IKEA and others are going 'climate positive'

IKEA, EV Charging
IKEA
IKEA's ambition is to reduce more greenhouse gas emissions than the entire IKEA value chain emits. CEO Torbjörn Lööf said: "This will require a transformational change for our supply chain and how our products are designed."

Let’s test your sustainability knowledge. What do the following businesses have in common: Max Burger, a major Swedish fast-food outlet; Mevo, a New Zealand car-share company; Briggs Automotive Company, a boutique sportscar firm based in the United Kingdom; and Interface, a multinational manufacturer of carpet tiles?

Answer: Each member of this diverse group has a product that claims to be "climate positive" — meaning that the product helps remove more greenhouse gases from the atmosphere than are released during its creation. 

These offerings appear to turn consumerism on its head, transforming a purchase from something that inevitably leads to more emissions into an act that cleans up the atmosphere. The emergence of this idea has prompted major corporations, including IKEA, to pursue climate-positive initiatives. But it also has led some climate change experts to caution that the movement could lessen the pressure on companies to make more fundamental changes.

Creating a climate-positive product typically involves three steps. First, the manufacturer totals up all the greenhouse gas emissions involved in the creation of its product and, in some cases, the emissions associated with the product’s use. Next, the company takes steps to reduce those emissions, perhaps by switching to renewable energy to run a portion of its operation or focusing on low-carbon options for its supply chain. In the final step, the company purchases more carbon credits than it needs to offset the emissions that remain, ensuring that the entire process is carbon negative. (The terminology can get confusing: "climate positive" is generally used as a more inspiring way of saying "carbon negative.")

Briggs, Mono, carbon positive, offset, carbon removal
At U.K. car company Briggs, carbon credits are used to offset emissions generated during the production and distribution of its Mono supercars.
The precise method for going climate positive varies from company to company. Mevo reduces emissions by using hybrid electric cars and offsetting 120 percent of what remains by supporting rainforest projects in New Zealand and the Pacific Islands. At Briggs, carbon credits are used to offset emissions generated during the production and distribution of its Mono supercars. 

At Max Burger, Chief Sustainability Officer Kaj Török and colleagues have used a raft of measures to reduce emissions, including using only Swedish beef, which cuts down on transport emissions and promoting menu options that don’t contain red meat. The company then funds forestry projects in Africa that it says will draw down 110 percent of the emissions they cannot eliminate. "Every bite is good for the climate," claim Max’s marketing materials.

Going climate positive is impressive for a company with a turnover of more than $240 million, but Max’s revenues are two orders of magnitude smaller than those of another Swedish company with the same goal. IKEA employs over 200,000 people in more than 400 stores that generated $43 billion in sales in 2018. "By 2030 our ambition is to reduce more greenhouse gas emissions than the entire IKEA value chain emits, while growing the IKEA business. This will require a transformational change for our supply chain and how our products are designed," Torbjörn Lööf, CEO at Inter IKEA Group, said last year.

The home products multinational aims to achieve this by switching to renewable energy wherever possible and working with stakeholders to phase out coal and oil use by its textile suppliers in India, Indonesia, Pakistan and Turkey. 

[Learn more about climate-positive businesses at "How to Set Your Company on a Path to Negative Emissions," an hour-long panel session at VERGE 19. Confirmed speakers include Erin Meezan, chief sustainability officer at Interface, and Mark Bernstein, Walton Chair for Sustainability Solutions at Arizona State University.}

"Every action matters," added Lena Pripp-Kovac, head of sustainability at Inter IKEA Group. "For example, we will further improve the efficiency of our LED bulbs and introduce more plant-based choices in our restaurants. We are also developing a low-impact glue for our wood-based products, which can reduce the total IKEA footprint by up to 6 percent." 

The fledgling climate-positive movement has generated almost uniformly positive coverage, but the benefits might not be as clearcut as they seem. One concern is that offset schemes do not always remove all the carbon dioxide that they promise to. Political or economic changes can lead to projects being harvested for timber, for example, and protecting one area of rainforest can trigger logging in a neighboring section. Still, one-sixth of the world's economy soon could be covered by some sort of carbon-neutrality commitment.

The risk of a project's having some adverse ripple effect can be limited by investing only in offsets that are rigorously monitored by a third party, something that Max and many other climate positive companies say they do. But there is also a more basic concern that a company can earn the climate-positive label by buying offsets — which are relatively cheap at present — without making more fundamental, and sometimes more expensive, changes to its operations and supply chain. 

"It gives a weird signal to consumers — don’t worry, just keep consuming the way you are," said Brad Schallert, WWF's deputy director of international climate cooperation. "What we really want to do is change the fundamental product process."

One business tackling that kind of fundamental change is Interface. The company uses offsets to ensure that all of its products are carbon neutral, but it is also creating products that contain plant-based materials and so contain carbon that has been pulled from the atmosphere. 

IKEA is pursuing an even more ambitious strategy by pledging to go climate positive by 2030 without the use of offsets. "We are confident that natural carbon storage in our products and positive effects of responsible land use, as well as going beyond IKEA and enabling reductions outside of our own value chain will secure the remaining needed reductions," said Andreas Ahrens, head of climate at IKEA Range and Supply, the business within the IKEA group that develops and supplies IKEA products.

"Just offsetting, that’s not interesting," agreed Andreas Slettvoll, a founder of Chooose, an Oslo-based consultancy that helps companies turn parts or all of their business climate positive. He says that Chooose prefers to work with clients that have targets for reducing their own emissions. Some clients, he added, see the offset fee as a kind of carbon tax, which incentivizes them to work to reduce it by eliminating emissions. 

Whatever the doubts, the reputational benefits that come from being climate positive have helped Chooose to acquire more than 150 corporate clients since it was founded in 2017. Slettvoll said that younger companies want to be climate positive because they start life with sustainability as a core value.

For more established businesses, it can be a matter of avoiding consumer criticism. "If you sit still or put your head in the sand, you will have a big problem in a couple of years," Slettvoll said. "You won’t be seen as relevant."

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