Swedish furniture company Ikea announced Thursday that it is pledging $1.13 billion to fight climate change, according to the Ikea Foundation website. About 60 percent of this fund will be spent for building renewable energy or wind power in poor countries, pushing the company towards becoming a more socially and environmentally responsible enterprise.
Ikea's business has been booming and, in the last year, the company has made $32 billion in profits, according to Fortune. But while this is good news for its investors and stakeholders, the sales have been bad for the environment. Ikea consumes 1 percent of the world's logged wood supply to manufacture its easy-to-assemble furniture, reported Fortune. The company would now like things to change.
A survey of Ikea patrons revealed that 41 percent said they "see Ikea as a company that takes social and environmental responsibility," according to Reuters. This is still short of the company's goal, as it would like to improve that perception to at least 70 percent this year.
On top of the billion-dollar funding, Ikea has also pledged to "plant as many trees as it chops down by 2020," according to Time magazine.
"I am heartened to see corporate leadership in this area," said Amjad Abdulla of the Alliance of Small Island States, according to Reuters. Abdulla is the chief negotiator for the U.N. climate agreement.
Ikea said that its stores worldwide will not be increasing prices as a result of this measure. In fact, its president and CEO, Peter Agnefjäll, said that the drive will be "good for customers, good for the climate and good for Ikea too."
"Climate change is one of the world's biggest challenges and we need bold commitments and action to find a solution," said Agnefjäll in the official announcement. "That's why we are going all in to transform our business, to ensure that it is fit for the future and we can have a positive impact. This includes going 100 percent for renewable energy, by investing in wind and solar and converting all our lighting products to affordable LED bulbs, helping many millions of households to live a more sustainable life at home."
