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Ikea’s response to its illegal timber scandal is a sham. Here's why

29.10.2020

Ikea stated earlier this month that it had completed investigations into its use of illegal timber from Ukraine and had detected no issues with its wood sourcing. But the lack of independent oversight and transparency and narrow scope of these investigations throw the credibility of its findings into serious doubt. Its feeble response also shows a frightening lack of leadership on tackling illegal deforestation from the world’s largest furniture company.

In June this year, Earthsight published the results of an extensive investigation which showed how illegal timber from some of Europe’s last forests in the Ukrainian Carpathians was being utilised to make furniture giant Ikea’s most popular products. 

Relying on Ukrainian government data, shipment records, satellite imagery and whistle blower testimony, the report, Flatpacked Forests, argued that underpinning the problems in Ikea’s global supply chain are fundamental weaknesses within the popular consumer label ‘’FSC’’ [Forest Stewardship Council]. Ikea relies heavily on FSC’s systems to ensure its wood is legal and sustainable. The FSC label has come under increasingly heated attack from stakeholders around the world, and has been linked to a whole gamut of scandals- human rights abuses, illegal deforestation and the illegal timber trade to name a few- by journalists and NGOs.

FSC reacted to our report by digging in its heels and issuing blanket denials about its well documented flaws, statements we have recently debunked point-by-point. The Ukrainian Prime Minister announced a crackdown on illegal timber immediately following our report and the corrupt Ukrainian forestry agency is currently at a crossroads, facing, and continuing to resist, demands for it to be overhauled.

Meanwhile, even as government authorities unearthed fresh evidence of law breaking by its supplier over the summer, Ikea responded to our investigation by stating it took our allegations seriously and that it planned to thoroughly investigate the issue. 

Earlier this month, Ikea released a short statement saying it had completed these investigations and claimed it had found no illegal wood in its supply chains. 

Here are six reasons Ikea’s claims cannot be trusted.

Ikea chairs linked to illegal Ukrainian timber in Earthsight's Flatpacked Forests report. Photo: Jeremy Bristow

  • Its ‘independent’ investigations are nothing of the sort

Ikea has told Earthsight that it conducted two investigations- one an internal desk-based investigation and the other, an ‘’independent’’ investigation by an obscure Kyiv-based firm named Legallis LLC. Legallis LLC is a body that also profers FSC certificates to timber companies and forestry authorities in Ukraine, meaning it is indirectly implicated in our report’s findings about FSC’s failures and has an obvious conflict of interest. Choosing a body within the FSC circle to conduct this investigation is perhaps an indication that Ikea is unwilling to risk exposing itself to a truly unbiased investigation of its supply chains. 

  • It won’t share the full results of its investigations

When a company like Ikea has just been caught in a major illegal timber scandal, the least its consumers can expect is total transparency about what it has done to resolve these problems. But in its initial public statement, Ikea did not share any details of its investigations.

Earthsight and several other NGOs working on Ukrainian forest issues wrote to them requesting they disclose the full reports from both their internal as well as external investigations. Ikea declined to do so, saying this was ‘’to preserve the integrity of the individuals and partners involved, as well as the methods deployed by the auditor for this investigation in Ukraine.’’

In Flatpacked Forests we demonstrated how the value of any audit of a supply chain depends largely on exactly what evidence it looks at. Without further information it is impossible for us to give Ikea's fresh 'investigations' any more credence than the past FSC audits which we found had utterly failed to detect serious illegalities and unmitigated illegality risks. 

  • Decides to interpret law in a way that contradicts Ukrainian government authorities and is worse for the environment

What little information Ikea has shared publicly seems to show it places profit above the environment. In our report, among many other problems with Ikea’s supply chain, we detailed how Ukrainian state inspectors had caught Ikea suppliers flouting environmental laws to cut beech trees used to make many of Ikea’s most iconic chairs, such as the 'Terje and Ingolf.

 Inspectors had found the supplier had conducted ‘sanitary’ logging in valuable beech forests during periods when such logging is banned due to their importance for breeding wildlife. Inspectors detected this destructive logging occurring in consecutive years, even shockingly, during the 2020 Covid lockdown.

 Yet Ikea has stated that the interpretation of this law is ‘’challenging’’ and that it is working with the FSC to resolve issues of ‘’conflicting legislation.’’ Not only does Ikea seem to be directly contradicting a state body which found rampant rule breaking by its supplier, it is supporting an ‘’interpretation’’ of a national wildlife law that is much worse for Ukraine’s forests - one that condones increased logging during this sensitive season for wildlife in the Carpathians. While we may expect such an industry-pandering approach to the environment from the FSC, Ikea’s consumers deserve more. 

In a separate supporting statement, the FSC said that it henceforth would graciously choose to adopt the more ‘strict’ (that is ‘’better for forests’’) interpretation of the same wildlife law even though it had originally responded to Earthsight by saying it already used this strict interpretation. All this desperate backtracking and evasion is time that could be spent fixing the systemic issues in Ikea’s supply chain (namely, the FSC). But to solve a problem, you first have to admit you have one. There is no sign of that here.

Green timber label FSC has failed to investigate Earthsight's findings. Photo: Earthsight

  • Scope of investigations is too narrow

Ikea’s woes are far from confined to suppliers in Ukraine. Ikea is currently being investigated in Switzerland for breaching laws requiring it disclose the origin of wood used in its products. Considering at least 60 per cent of all Ikea’s timber needs are met by ex-Soviet countries in Eastern Europe or Russia, perhaps it’s not surprising Ikea would rather consumers not know that the wood used in its ‘Scandi chic’ furniture comes from places with highly corrupt forest management regimes.

 Most of these countries have inherited a similar forest management structure but the illegal deforestation we discovered in Ikea’s Ukrainian timber supply pales in comparison to places like Belarus and Russia, from where Ikea sources vast quantities of timber each year. These countries are notorious for having far less transparency, more rule-breaking and more entrenched corruption, issues which the presence of FSC-certification has proven to be unable to tackle.

  • It is silent about FSC ineptitude

Nowhere in its response does Ikea acknowledge the abject failures of FSC to detect the illegalities we found in its Ukrainian supply chain. Nor does Ikea admit there may be structural issues, including ingrained conflicts of interest, deep within the FSC- issues that are increasingly rendering it obsolete globally. [For more information on FSC’s global failures see chapters 4 and 5 of our report]. Commentators from timber industry insiders to some of the world’s largest environmental groups have slammed FSC for pandering to commercial interests for years, at the cost of local communities and forests.

Our report showed why FSC standards are actually lower than those being demanded by law in the EU, yet both Ikea and FSC are pushing for FSC certification to play a greater role in meeting the requirements of the European Union Timber Regulation.

As one of FSC’s most important clients, Ikea can use its enormous soft power to leverage real change at the scandal-prone label. Instead Ikea has stated it will continue to support FSC’s piecemeal efforts in Ukraine even though our report has overwhelmingly shown that such isolated efforts alone will not make FSC fit for purpose, nor consequently keep furniture made from illegal FSC-certified timber out of Ikea stores.

Ikea stated in an email to Earthsight that FSC was only one of the tools it used to check its suppliers, and that it regularly conducted its own random audits to verify compliance across its supply chain. It is unclear if such audits had already been carried out for the Ikea suppliers named in Earthsight’s report, or if they were, why they failed to detect the wood extensively documented as being illegal by Ukrainian government inspectors and Earthsight.

  • No plans to drastically reduce wood consumption

Ikea is the biggest wood consumer on the planet. What does this mean? Let’s break it down again. It consumes one tree a second. In 2019 it consumed a mind-boggling 21 million cubic metres of wood. That’s enough logs annually to encircle the world 6 times. Sixty per cent of the company’s tens of billions of Euros of annual sales are of wood products. And every year the company consumes two million more trees than the year before.

Ikea has announced schemes to recycle or repurpose furniture but uptake is very limited and the impacts of these efforts are dwarfed by the untenable pressure it puts on forests for raw materials each year. Most of the wood Ikea uses, including the illegal wood we discovered in its supply chains, is FSC-certified.

At the Global Launch of Countdown, a TED-hosted virtual climate event, introduced by Al Gore, Ikea boasted about how the timber it used was from ‘sustainable sources’ in spite of our recent report having proved that this is hugely misleading, since most of this supposedly ‘sustainable’ wood is virgin lumber from FSC-certified (and hence deeply problematic) sources.

At the same event, company representatives, sitting in a carefully arranged mock Scandi living room and surrounded by wooden furniture, a lot of it no doubt made with wood from Eastern European forests, reiterated the company’s solemn commitment to keep growing bigger and to make ever cheaper products. They explained the dangers of believing in the ‘’consumption myth,’’ claiming increased consumption and sustainability go hand in hand, something that all respectable opinion on the environmental crisis has debunked.

Continued consumption of growing quantities of cheap, fast furniture, the company is in effect telling us, IS perfectly sustainable. It’s ‘chuck out your chintz’ all over again. As we document in our report, this focus on growth and cheapness by a company that already has an enormous forest footprint is decimating forests and increasing the pressure on its cash-strapped suppliers in poor countries to cut corners on legality and the environment.

Like the age of Oil, the age of ‘fast furniture’ faces a reckoning. The writing is on the wall- furniture behemoths like Ikea have to cut down far fewer trees each year for our remaining forests to stand a chance. And they need to have done so yesterday.

Jesper Brodin, CEO of Ikea's parent company Ingka Group, and chief sustianability officer Pia Heidenmark Cook discuss the company's environmental policies at the TED Countdown event, October 2020. Photo: YouTube

In a letter to Earthsight Ikea stated that in future it planned to put 'extra' effort into their on-site investigations in high-risk countries and stated that after Covid it would also increase the volumes of on-site investigations in Ukraine. Earthsight welcomes these announcements.

But in the months since our report more than 200,000 people have demanded Ikea take more meaningful action like setting targets for reduction of wood use and stopping sourcing timber from natural forests. They have called for Ikea to undertake independent comprehensive investigations into all its supply chains from high-risk countries and have urged Ikea to support structural reform of a decrepit FSC to make it fit for the 21st century. Ikea has conspicuously failed to address any of these demands.

The company’s recent statements have shown that far from being a sustainability leader, it is continuing to use FSC’s greenwash in order to pursue a destructive growth-and-cheapness strategy while claiming to be a good global citizen. Paying the price will be us consumers, our remaining forests and the climate. In the meantime at Ikea, illegal wood remains a part of the furniture. 

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