In the last episode of the first season of the Purposing podcast, Given CEO Becky Willan speaks to Simon Henzell-Thomas, Global Director Climate, Ingka Group (IKEA). 

The two discuss how purpose can catalyse positive change inside and outside a global organisation, the challenge of sustainable growth, and busting myths about the retail giant. Simon explains how IKEA is shifting to sustainable materials and business models at a scale that’s unimaginable for most companies and lifts the lid on the things that really make the difference - from circular and inclusive design approaches to investment management, governance and measurement.

Listen to Purposing for the inside story on one of the world’s most respected purpose-driven businesses. 

Do you want to learn how to build a purpose-driven business from Given, the consultancy that’s helped some of the world's largest organizations become purposeful? Download the Insiders’ Guide to Purpose HERE. 

This week I'm joined by Simon Henzell-Thomas, director of global public affairs, advocacy, and transparency At IKEA. Simon has spent the last 20 years helping businesses have a positive impact on people and the planet. Through this conversation, you'll learn how to create a positive relationship between purpose and profit, build belief in your purpose across your workforce and use the power of your brand to create meaningful change in the world. Before I speak with Simon, let's take a quick look back at his career to learn how he became responsible for purpose-driven campaigning and advocacy at IKEA.

Like many 21-year-olds, Simon decided to go traveling after university.

That really attracted me to working and, and trying to have a positive impact in the business community.

So Simon, welcome to the show.

So it's a super inspiring vision that everyone should be able to afford a nice home. It's about democratizing a nice home and home furnishings and providing that at such an affordable price that as many people as possible can afford them, and actually within that vision. There are three parts. One is obviously about affordability, one's about accessibility, and the other is about having a positive impact on people and the planet because of course, you can't create a better everyday life if the planet is burning, um, or if the environment is in trouble.

So, Ingvar Kamprad wrote something called a testament of a furniture de, where he laid out this vision. I would say the purpose is really well understood and embedded. I think it's, um, a bit like a stuck rock in IKEA. I'd say a large number of coworkers buy into that vision. I think it's what gets many of them up in the morning.

I think it's what keeps many of them awake at night, and I think it's why people join IKEA ultimately, and probably why many stay.

So what do you say to that? How do you reconcile that idea with this focus on affordability and sustainability?

Focusing on how, when, and what we consume so that it is, yeah, it's a sustainable mechanism and I guess in, IKEA, we're on a journey there. I wouldn't say we're perfect. I don't think we have all the answers, but one of the ways that we try and contribute to sustainable consumption is through sustainable production.

So making sure that the products are produced and offered with sustainability at the core. Then I think the question of scale is really interesting, cuz one way of looking at it is that scale is bad. But what if we actually looked at it, that scale is good, and if we are able to produce sustainable furniture and sustainable services, what if we scaled that, sustain sustainability to many more people than would normally have access to it?

And I think linked to that as well, and it comes back to IKEA's vision. It's this thing of, why Becky, should sustainability be only affordable for the few?

But my argument would be that the world should be better off with more IKEAs rather than less.

I think one of the things that's interesting about IKEA, or IKEA, I should say, from saying it properly, is that your founder defined that idea back in the seventies when the world was, you know, undoubtedly a very different place. So how are you ensuring that that idea is, is still relevant and impactful today when there have been so many changes in the external context?

He said things like making mistakes are a privilege of the active and happiness is not reaching your goal. Happiness is on the way. The purpose should be in a forever document. And you know, then strategies and plans can change, but the purpose stays consistent and constant. And for me, that's the test of it.

And I guess that's the point because for the purpose to drive that kind of profitable, sustainable growth, it can't be a side project, it has to shape. All of the ways in which the business creates value. So it'd be great to understand what are the main ways that purpose is a source of value creation for IKEA.

And the idea behind that is that we try and look at more of a four-dimensional perspective on value creation, which goes beyond revenue. So we look at value for customers and we look at how we create better homes, um, which is very core to the vision. We look at the value for people and communities, and how we help them live better, healthier, and more sustainable lives.

We look at value for the planet, and we also look at value for the company, which of course includes profit. We're not an NGO. Of course, IKEA needs to make a profit. But what we try and do is, is a balance that all up. All of our business leaders now are accountable for delivering value in all four of those dimensions in their respective units, and this is how we measure success.

I'll be honest and humble that that's a journey, you know, for a company who's been measuring a certain way for a while, then of course there, there's a certain amount of catch-up in other areas, but that's the intention that we really drive value in a four-dimensional way, not just a one dimensional way.

So what are, some of the things that IKEA has done differently as a result of having such a clear purpose and of creating clarity about the outcomes that you're trying to drive through your purpose?

It's, it's also good for returns, right? Because renewable energy is increasingly a good investment as well. During Covid, we all, like many other retailers, had to close our stores to protect coworkers and customer health. So, we saw at the time that governments were offering funds to furlough some of those coworkers, and actually, we thought that was the responsible thing to do to help protect the livelihoods of those coworkers.

We then saw digital sales take off. And in the end, we took quite a tough decision and we actually decided to voluntarily pay back all the money that we'd received from governments because we felt it was the right thing to do. And because we felt if we were simultaneously doing better than expected, we shouldn't hold onto that money.

So that was quite a big test of our purpose and one I think we're quite proud of.

It can be a guiding star, it can be a north star, it can be, you know, something you hold onto, but ultimately you still need to navigate dilemmas. I think in that example it was a classic case of, you know, senior business leaders, discussing a dilemma, bringing in the ethical component, bringing in the business component, bringing in our values, bringing our purpose, and then ultimately you just have to decide what you think is the right thing to do.

Sustainability and affordability. We want them to go hand in hand, but we can't be naive. Sometimes there is a trade-off. Sometimes you need to pay a bit more. Sometimes you may need to make a shorter-term investment upfront that results in a longer payback. I find also when you go in, go into these conversations, it's good to be as open as possible.

I mean, I have my own values and I have my own beliefs, and I've been in sustainability all my life, so of course, you know, I'm passionate about it, but I also find you, the more open you are in the discussion, the more you empower others, and the more you empower the leaders around you and you lead independently through the dilemmas, I think the more you build that muscle internally,

And equally, are there any downsides to this? Because the majority of complex businesses are on the journey of shareholder-owned, are PLCs. It's interesting that you look to businesses like IKEA, John's partners who have, you know, the co-op group in this country have different ownership structures. So what are some of the advantages, and disadvantages of that from your experience?

And in that way, we secure financial resilience and deliver to the purpose. So it's quite a unique setup and I think that does allow us certain things. I think it, generally in my experience, means we can take longer-term decisions. It means we can take a slightly longer game when it comes to investments.

It allows us to be a bit more focused, on the purpose dimension than maybe if you're in a listed company. So I think they're the pros. I think the thing I have noticed is I have some friends who work in listed companies and I think the rigor of a quarterly forecast and of needing to be accountable to shareholders regularly can also be quite a good discipline.

And I think IKEA has been on a journey, to increasingly become more transparent and more open, which I think we're in a good place now.

So how are you making sure that your purpose genuinely shapes the day-to-day experience for a typical IKEA co-worker, which is what you call colleagues and employees in the business?

Whenever you go into a meeting, the purpose is almost repeated, through many situations. So I think there is, through the onboarding and, and getting access to people around you and, and certain training modules, and I think there's quite a strong focus on culture in IKEA, and maintaining that entrepreneurial culture that Ingvar started.

We try and celebrate success and highlight it internally when it goes right. You know, when you're a senior leader, for example, coming in now, it's very clear how you're appraised and how your performance is, is driven. It's, it's through that balanced scorecard. We launched, uh, an assembly guide for the future we called it, which was just a book, but it was a book that explained what IKEA has done is doing and will do on sustainability over the many decades, cuz I think sometimes you forget the heritage and that book was sent to all coworkers and it was quite well received. And I think you need to keep laser-focused on making sure people continue to get exposure to the purpose and, get inspired by it.

So I think that's clearly a big trend now, and we notice it, with talent, with retention, with recruitment. It doesn't go into an interview where I don't get a question about, okay, what are you doing on sustainability? Then I think employees and coworkers are attracted to companies now in part because of the career journey, the benefits, and the pay, but also because now increasing their sustainability strategy and their purpose.

So what are the things that you think you still need to work on?

So how important. Is campaigning advocacy for purpose-driven businesses, do you think?

And whether we like it or not, I think some of the most powerful voices in society are brands. It's a great privilege, but also a great responsibility. Partly in

That's quite unusual, it's not a sort of typical public affairs team. So how did the creation of that team come about, and I guess what makes it different from the ways that other businesses might sort of organize, their efforts in that space?

Even when I say that, I say it in a quiet voice, it's, it's quite a Swedish value and it's also a very strong IKEA value. It's humbleness. But I think humbleness doesn't necessarily mean being silent, and I think that is a realization that we've had that it is actually, it is our responsibility to have a seat at the table, to share a point of view, and to try and use the IKEA brand for greater good and greater impact.

So, We have a traditional public affairs team who does amazing stuff to influence policy, but we also asked ourselves, what if we actually took some of those asks and positions to a wider audience? What if we ran campaigns to customers around societal topics? Still, Becky's is still a work in progress. I think the team's a few years old, but the theory of change there is that maybe we could leverage the power of business to achieve some bigger change in society. We ran an alternative, uh, black Friday campaign, and the starting point for that was what if we flipped the script on Black Friday and instead of running sales across the business, what if we actually drove people to our resale area and tried to get people to bring furniture back and, and, and to, to take part in the secular economy?

And it's been a super cool campaign, really well received by customers. I think if you start a campaign like that with what do we wanna achieve in society, then I think you're off to a winner because you, you then deliver that around a societal goal. And then, of course, you get, the marketing muscle in and you get the brand muscle in.

And of course, that drives really good leverage with customers. But I think then you avoid quite light greenwashing campaigns. Ultimately the goal is to do something meaningful and create change.

So how do you ensure that the business is taking sufficient action on any issue that you choose to support campaigning, how do you make sure that the substance is there before you really go all in?

You know, if you are campaigning on something, then you need to at least be, you don't have to be perfect, but you need to have something to say. Sometimes I think brands are accused of taking advantage and being opportunistic in certain situations, and I think you, you wanna avoid that as well because it's not genuine for a global campaign.

It needs to be in line with our own actions. It needs to be good for people planning and for. And it needs also, I think, to be locally relevant as well as globally sensitive. Cuz some of these topics are, are so different if you're in Australia or if you're in Serbia. So they're some of the guiding principles that we have.

And you know, you should together decide whether or not you have legitimacy on that topic. And normally I find the content owners or the experts they know, so you know, someone in sustainability will know if we can take a stand on something because they, they feel it and they know it.

So I think the theory of change is really important. I'll give you an example. With climate change, we with our partners, notice that there is an ambition that we can drive. So if we advocate with other brands for better policies, that in turn can drive higher ambition in the business community. So it's like this kind of virtuous circle.

So that was quite an aha moment of a theory of change that is shared with others. Of course, the climate change community knows this, and the NGOs, and the civil society movement, know the theory of change. So I think one of the key things is to be connected with those communities on, on topics that you are gonna campaign on in Australia and Italy.

The teams did some amazing campaigning on the topic of domestic violence because they felt it was a topic that was important in their societies and to their customers, and they did it in a really sensitive way with a lot of research and really digging into the theory of change.

Thank you so much.

Creating metrics for your purpose will help shift mindsets away from a singular focus on profit maximization to show how your business creates value on all measures.

Although it's no silver bullet, making your leaders accountable for delivering on a balanced score is. And linking that to remuneration will help drive better purpose outcomes. Your purpose should act like a North Star, helping you make decisions, assess options, and prioritize investments, but it's rarely easy.

You need to create space for deliberate, thoughtful conversations. Be open-minded and face trade-offs. It's not necessarily about making different decisions, but it's about making decisions differently. To use the power of your brand to create positive change, you need to get the right people working together.

That means joining up marketing, public affairs, and sustainability. Start with the impact you want to create. Define your theory of change, and then build your campaign.

If you'd like more practical advice on building a purpose-driven business with brilliant insights from people like Simon, download the Insiders Guide to purpose@givenagency.com slash insiders guide.