In this report Introduction About this report Introduction letter Page 3 This report summarises our performance compared to The IKEA business in FY23 Page 4 the IKEA sustainability strategy, People & Planet Positive, FY23 sustainability highlights Page 5 during FY23. It covers the entire IKEA value chain and franchise system and provides an update on activities and the ongoing work to measure progress. The IKEA 1 The IKEA sustainability strategy Page 6 Sustainability Report is issued by Inter IKEA Group. FY23 global trends and challenges Page 7 The reporting period follows the 昀椀nancial year 2023 (FY23), which runs from 1 September 2022 to 31 August 2023. Percentages in this report may not total 100% due Healthy & sustainable living Page 8 to rounding di昀昀erences. Please note that we review and FY23 summary of progress Page 9 update historical data for accuracy on an annual basis. FY23 key activities Page 10 These changes are updates to external reference data, improved calculation methodologies and data quality. Our circularity agenda Page 15 FY23 summary of progress Page 17 The IKEA business is de昀椀ned as the business activities performed by all companies operating within the IKEA FY23 key activities Page 18 franchise system. “We” in this report refers to the IKEA business. The IKEA value chain encompasses more than Our climate agenda Page 22 the IKEA business and includes sourcing and extracting FY23 summary of progress Page 25 raw materials, manufacturing, transporting of products, FY23 key activities Page 27 retail activities in stores, customer travel to stores, product use in customers’ homes and product end-of-life. Regenerating resources, protecting ecosystems, and improving biodiversity Page 30 To ensure the long-term growth and development of the FY23 summary of progress Page 31 IKEA business, we use a franchise system. This provides FY23 key activities Page 32 昀椀nancial stability while allowing franchisees to challenge, test and explore new markets and ideas. Together, we Fair & equal Page 46 continue to develop the IKEA Brand. FY23 summary of progress Page 47 FY23 key activities Page 48 IWAY – the IKEA supplier code of conduct Page 55 Stakeholder engagement Page 57 Sustainability governance Page 58 SDG index Page 59 1 Inter IKEA Group consists of Inter IKEA Holding B.V. and all its subsidiaries. An overview of Inter IKEA Group can be found here. 2 - IKEA SUSTAINABILITY REPORT FY23