Evolving our approach to climate reporting

Our approach to climate data

Last year, we began updating how we calculate our greenhouse gas emissions to reflect current reporting and assurance requirements including CSRD. FY26 is the first year we are reporting emissions using this updated approach. Our previous reporting followed established greenhouse gas (GHG) accounting standards and voluntary target setting standards available at the time.

This updated approach gives us a consistent foundation for climate data, helping us understand our impact and prepare for future assurance. This includes changes to our reporting scope, data sources and calculation methodologies, meaning FY25 and FY26 emissions figures are not directly comparable with those reported previously.

We welcome the clearer expectations CSRD brings for data and reporting. More detailed data, including increasing the use of supplier- and value chain-specific data over time, can help us better understand where our emissions come from and make even more informed decisions about where to focus our efforts. This is particularly important for materials, which represent the largest part of our climate footprint.

As our scope, data and methodologies have changed, we are setting a new baseline and new targets following the SBTi Net-Zero Standard, which is designed to support a 1.5°C pathway. We plan to be ready for internal approval in FY27 before submitting them to SBTi for validation.

Reporting is evolving, but the work continues.

In FY26, total Inter IKEA Group greenhouse gas emissions decreased by 8% compared with FY25. While lower purchasing volumes were the primary driver, we continued to take action:

• 100% of the electricity consumed in our own operations came from renewable sources, meaning generated on-site, purchased through offsite renewable electricity contracts, or matched through renewable energy certificates.

• Renewable energy production at our own IKEA Industry sites increased by 46%, and we continued work with suppliers on renewable energy and energy efficiency.

• We continued working towards reducing reliance on virgin materials and increasing the use of recycled materials. For example, IKEA Industry is working on wood recycling projects aimed at increasing the share of recycled wood in particle board and improving drying and board manufacturing processes to reduce energy consumption. IKEA Industry has also started construction of a new Cyclic Thin Board site to produce thin boards using wood waste.

Looking ahead, materials represent the largest part of our climate footprint and are a key focus for climate action. To support even greater understanding of their impact and help prioritise action across how we source, produce, use, and recover materials, we are improving how we trace and collect data across our value chain about our largest material groups - wood, metal, plastic, textiles and paper.

While the way we measure and report our emissions is evolving, our climate work continues. We will keep taking action across the IKEA value chain and use what we learn to help us focus our efforts where they matter most.