Introduction | Becoming People & Planet Positive | Stakeholder engagement | Sustainability governance | SDG index Healthy & sustainable living - Our circularity agenda - Our climate agenda - Regenerating resources - Fair & equal - IWAY We're on a journey to transform the IKEA value chain to become circular Recycled raw materials (third party) Virgin materials (renewable and non-renewable) The model (to the right) illustrates the 昀氀ow of IKEA products in a more circular economy – from idea and the sourcing Materials & ingredients of materials to the use of products in customers' homes Recycle Each stage of the IKEA value chain has and back into the circular 昀氀ow for reuse or recycling. We're Collection and an impact. We are taking many steps to working to eliminate waste, circulate products and materials handling at mitigate our negative impacts. A crucial 1 product end-of-life and move away from the use of virgin non-renewable part of this e昀昀ort is creating circular materials. We’re also developing more services and products 昀氀ows that extend the value of products and materials within or outside the to enable customers to participate in the circular economy Design IKEA value chain. A circular 昀氀ow of IKEA and create and are continuously working to improve our social and Recycle products, as part of a fully circular environmental impact at every stage of the value chain. (third party) society, is our ambition for the future. We create products using the IKEA Democratic Design Remanufacture principles of form, function, quality, sustainability and low price and by applying our Circular Design principles in the design phase. Our design thinking considers many aspects – like choosing the most suitable materials, always aiming to Reuse do more with less, and optimising manufacturing methods OUTSIDE THE IKEA WITHIN THE IKEA VALUE CHAIN VALUE CHAIN Production while designing on the factory 昀氀oor. We also want to prolong the life of products by designing with circularity in mind and o昀昀ering products and services that make it possible and Product use in easier to reuse, refurbish, remanufacture and recycle. Remanufacture customers' homes (third party) Resell We recognise that the IKEA value chain doesn’t exist in isolation. It 昀氀ows through communities and nature and is Refurbish connected to an infrastructure in society that enables the Product growing circular economy. The IKEA value chain impacts transport people, livelihoods, ecosystems, biodiversity and the climate. Refurbish & resell That’s why we strive to take a full value chain approach (third party) and work in partnership with franchisees, suppliers, NGOs, governments, other businesses and organisations to minimise our negative impact on people and the planet. Customer travel & home deliveries 1 IKEA retail A majority of the collected products at end-of & other operations life, today goes to incineration and land昀椀lls. Our ambition is to completely eliminate this. 16 - IKEA SUSTAINABILITY REPORT FY23