Learning to embrace risk (with Jesper Brodin)

How do you create a culture that empowers people to take risks?

IKEA is a company that knows a thing or two about breaking conventions, and Jesper Brodin, as CEO of Ingka Group, is working hard to embed this entrepreneurial spirit throughout the company.

Jesper shares his incredible journey, which includes leading IKEA through the pandemic, with JP on the latest episode of the Positive Leadership podcast.

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Transcript

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JEAN-PHILIPPE COURTOIS:  Hello, I’m Jean-Philippe Courtois, and this is Positive Leadership, the podcast that helps you grow as an individual, a leader, and ultimately as a global citizen. IKEA is the world’s largest furniture retailer. Roughly 882 million of us visited IKEA stores last year. Driven by IKEA’s vision to create better every day for many people, it is the INGKA Group which brings the IKEA brand to its customers. My guest today, Jesper Brodin, CEO of INGKA Group, is well-known for his exceptional leadership qualities. Under his guidance, the group has not only embraced the code or guidance but has also set new benchmarks for corporate sustainability. By 2030, IKEA is committed to only using renewable and recyclable materials and to reduce the company’s total climate footprint by an average of 70% of products.

JESPER BRODIN:  Being climate smart means being resource smart, means being cost smart. So obviously there are areas and decisions to be taken. There are shifts in legislation that needs to happen and so forth, but our general mindset is that climate smart is going to help us make IKEA economically much better in the future. Not only in the future, we see the evidence all around us right now. 

JEAN-PHILIPPE COURTOIS:  It was super exciting to sit down with Jesper to talk about corporate sensibility in driving large care change, importance of risk taking and positive leadership, and his achievements has a singer in a heavy metal band. I hope you enjoy the episode. Stay with us to the end. Can you tell us, to start with, about your childhood and the way your parents, your family helped define some of your core beliefs, your values, and who you are as a person?

JESPER BRODIN:  I think, you know, when I reflect upon my childhood growing up in the ‘80s in Sweden, one thing that sticks out for me that I realize, now being 50+ is that there was sort of an era where we all believed in that from now on things will only get better. My parents had a better life standard than their parents, and there was something in passing on the optimism, and I think it sits with me also as a warm memory of those years, but also sometimes as a struggle, being in a world where things are going up, down, left, right, in many aspects, and that deeply disturbs me. And I realize it has a little bit to do with my childhood, probably.

JEAN-PHILIPPE COURTOIS:  I’ve had a number of wonderful guests on the podcast, including successful CEOs who share with us, you know, some unique moments in their lives and the way it changed them forever. A couple of examples I have, Doug Conant, the former CEO of Campbell Soup in the US, he was fired when he was actually 32, and, as a result, started to consider what was holding him back from realizing his full potential, so he was really on the wrong start as a CEO. Another leader I’m sure you know well, former Unilever CEO Paul Polman, right? He shared with us on the podcast this crucible moment in 2008 when he was caught up in the terrorist attack at the Taj Mahal Hotel in Mumbai, an appearance which made him realize the profound link between poverty and violence and changed his life as well. And last, not least, very exciting leader, Bozoma Saint John, used to be, again, a boss at Netflix and Apple as well, she lost her husband Peter from cancer, and, based on that, deeply I would say of course involving experience in our life, she’s made a big decision. Actually, she actually then wrote a book on that, to live her life urgently. So I gave you those examples, but I’m sure you’d like to share one defining moment in your life, Jesper, that had a profound impact on the leader you’ve become today.

JESPER BRODIN:  The thing that pops to mind instantly for me, so I had my first international assignment was with IKEA. I applied for the job as country manager for the trading setup and structure in Pakistan.

JEAN-PHILIPPE COURTOIS:  I heard that, yeah.

JESPER BRODIN:  And I got the job. I was 25 years old. And, funny enough, which is a story in itself, after a year I asked my manager who came from a visit in Singapore, how come you take a 25 year old, no IKEA experience, no experience with Pakistan and offer this opportunity? And then he told me I was the only one who applied for the job, so I think sometimes we think we are special, don’t we? But moving to Pakistan was a defining moment in my career, riddled by conflicts those days. There were basically, from a security perspective, it was a partly dangerous place. At the heart of the society, there was a number of industrialists that I would say had an incredibly modern view on people and business, and we built the business together, which of course was the reason I was there, but became a struggle for me personally was to see some of the values or the principles or even the structures in society was not there when it comes to both people and planetary aspects, and I remember having a bit of a personal crisis also, on the one hand wanting to perform, wanting to show myself as a leader. At the same time, seeing things and experiencing things that were difficult to digest, which then became not only for me, but these were the times I think when IKEA woke up to a responsibility as with a question to say do we apply our values only on our in house or does that apply for the—

JEAN-PHILIPPE COURTOIS:  Every country where we operate, yes.

JESPER BRODIN:  End to end. And luckily we took the decision to go that route, and the defining thing for me was I thought at that moment that would mean sacrificing business or whatnot, but so my journey throughout IKEA has been to actually be part of proving that it is good business to be a good business. So that happened in Pakistan, which was, you know, incredibly strong from both environmental and people side, and, as we develop the business, which is still doing great, by the way.

JEAN-PHILIPPE COURTOIS:  Was there in particular any personal or corporate value that you felt was most at risk and that you are tested, right, as a young leader in Pakistan leading IKEA there and say, wow, should I be firm of that value or maybe not, because the societal construct that you just discussed, which is very different from Sweden, for sure.

JESPER BRODIN:  The conflict from me was how can we create better life for consumers and not for people in the value chain? How could that contradiction be okay? And I guess at those days, we then came to the conclusion, being also new in our expansions. These were new dilemmas for IKEA, not only for me, but we came to the conclusion it was not possible. There would be a denial for all of us, so thereby started the long journey for us on actually how do you find a way to not only serve your consumers but actually include everyone in your value chain, which I think we do today from making a foundation to supply chain to ourselves, our employees, our partners, and our customers.

JEAN-PHILIPPE COURTOIS:  That question that Jesper was grappling with at the time is a tricky one. To what extent should the company’s core beliefs and principles extend outside its four walls? A multinational company like IKEA has thousands of first, second, and third tier suppliers, and it’s not easy to control their mode of operations. Realizing transparency in every stage of a company’s supply chain network can be very complex. Their lowest level suppliers may be from markets where there is little or no interest in enforcing sustainability initiatives, all of which makes it really important to have a code of conduct for suppliers setting out key expectations and ways of working for environmental, social, and working conditions. IKEA introduced its code of conduct for suppliers back in 2000s, five years after Jesper took up that job in Pakistan. Thanks so much and thanks so much for having raised your hand to go to Pakistan, because I think it was a wise while actually courageous decision you took at the time.

JESPER BRODIN:  Well, I got the advice from a couple of people, my cousin who used to be early into trading, and he also said, you know, if you take the risk and take the chance, there is, you know, the loss is very little, but the gain, if you make it in Pakistan—

JEAN-PHILIPPE COURTOIS:  It’s enormous.

JESPER BRODIN:  You have an opportunity to make a name for yourself within the company, and I think he was right after all.

JEAN-PHILIPPE COURTOIS:  That’s wonderful advice. So actually early in your career, Jesper, you benefitted from some great advice from a mentor, which was to learn as much as you can and to take every opportunity to re-educate yourself and participate to the fullest in all work activities, and perhaps, more importantly, to avoid following the shimmering objectives of a title. So can you tell us about that advice and how it influenced you back then and hopefully continues to influence you today, although you are at the very top now of the company today.

JESPER BRODIN:  No, but I still remember, when you mention it, I still remember, and I think a lot of young leaders maybe who have the opportunity to listen to this would agree to certain stress, what is this going to lead to, what is my next step and so on. And I had lots of that anxiety. And starting in Pakistan, it was important for me not to be forgotten, so to say, in any ways, but the advice I got was really to focus on the opportunity that you have at hand, and it seems like basic and simple advice, but it gave me calm, and it gave me focus, and ever since I have decided with myself that I don’t all the thoughts about what’s going to happen next, I simply pushed them away, and that helps me not only focus, but it helps me be happy what I do. But it also helps me to avoid, which I’ve done a couple of times, opportunities of promotion or other job opportunities which would maybe be smart from a career planning perspective, and I try to avoid that and look at how can I develop myself. I think the maybe best advice I ever got was from my mother actually when I was young, and that was as simple as to say if you find something where you’re—she said yes, but if you find something where you’re good at and that also makes you happy, then that’s a good place to be. I know sometimes we might be good at things, but it doesn’t really make us happy. I have a lot of things I’m not good at, but the combination of the two I think leads to something more than a career, right?

JEAN-PHILIPPE COURTOIS:  I more than agree with you. Let’s go back now not just to you but to your company’s history, which is pretty amazing. IKEA was founded in 1943 in Amot, Sweden by Ingvar Kamprad, the IK, I mean the famous IK in IKEA. When I hosted Paul Polman on the podcast, he told us as well about a story of Unilever’s inception at the end of the 19th century in Britain to address the issues of hygiene in society and how, as he became the CEO, you know, he took the founder’s core values and translated that into the needs of today to reconnect the entire company and leadership team with Unilever’s roots and social mission. So as the incoming CEO when you took your role as CEO, did you find it important to refresh your team and employee’s memory on IKEA’s history and to tell the story of Ingvar Kamprad?

JESPER BRODIN:  I would say both and, so Ingvar was a visionary. He was a business entrepreneur. He was not necessarily so interested in strategy or administration or structure.

JEAN-PHILIPPE COURTOIS:  Was a vision.

JESPER BRODIN:  So vision and hands on was his style, and over the years I think he grew, as the company became successful, he grew in interest and passion in how do we actually contribute to the goodness of this world. Actually, the early ‘80s, he gave away the group to set up a structure of a foundation which still is the sole owner of the company, so there is zero euro that leaves our system. Either it’s reinvested to the company, or it’s given to charitable purposes, which is quite beautiful.

JEAN-PHILIPPE COURTOIS:  It is.

JESPER BRODIN:  So, you know, to a certain extent, the values that he represented I believe are timeless, the values of togetherness, the values of leading through certain good examples, the idea of actually having a purpose, serving humanity rather than just earning money, so all of these are good. At the same time, I like to believe it’s important not to strike a balance but to strike a dynamic relation between loving the past and creating the future, and there is, of course, a risk in  strong concept, company like IKEA, but we become arrogant, we become afraid of accepting the challenges of change or a changing society, so, when I started this assignment, I realized through customers and coworkers that, painfully enough, that we had been maybe leaning too much towards our past successes. So we were a little bit also in line of your business, Jean-Philippe, we were very analogue. We had pushed to the future everything digital, not everything, but a lot, and we hadn’t really taken a deep thought about the business operating model for the future, so I think, you know, love the past, but you need to stay very open and alert to what’s happening that places you into the future, like you referred to Paul Polman, he did so elegantly, to translate it into the next model, so to say.

JEAN-PHILIPPE COURTOIS:  No, I love that statement you made, actually. Very similar in a way to what Satya Nadella, my manager and CEO, of course of Microsoft has said once, you know, honor your past, your traditions, but lead with innovation to the future. I mean, it’s like you need to balance both, actually.

JESPER BRODIN:  Yeah, you need to. And I think the interesting thing is that, if you put them up against each other, the past is concrete, it’s clear, it’s defined. The future is not. So the future is more fragile. Ideas are more fragile. And therefore I think one of the values that our founder always kept center was the right and the obligation to make mistakes and the drive for entrepreneurship, and still I have many moments when that makes me a bit concerned as a big company and big group that we are rejecting the new a little bit too much, so there are many ways we try to go about that. My most desperate moment I’ve issued what I call go bananas cards, which I’m—

JEAN-PHILIPPE COURTOIS:  Go bananas, okay. What is it?

JESPER BRODIN:  Yes, yes. It’s an idea. So basically the card gives you a license. It looks like a driver’s license, but it gives you an encouragement to make mistakes. And, if you make a mistake and you have to apologize, I have already co-signed the excuse there, so you have a friend in me if you then do something that didn’t really work out well.

JEAN-PHILIPPE COURTOIS:  I love the idea of Jesper’s go bananas card, which promised the others that it won’t face any repercussions from him if they try something new that just doesn’t pay off. Having a risk-taking culture is something he works hard to cultivate, which makes sense, really. It’s been an important part of IKEA’s success in the past. It was partly because the company’s willingness to break with convention that it set up its first show room in the 1950s at the time when most of his competitors relied on mail order catalogues. The decision to introduce restaurants to home furnishing stores was hardly a safe bet. Many companies want to be innovative, but few are willing to accept that failed experiments come with the territory. More business leaders should license their teams to go bananas, if they want to close the innovation gap.

JESPER BRODIN:  IKEA now it wasn’t just there, it was developed through entrepreneurs, risk takers, and probably nine out of 10 experiments didn’t work out as we thought, but it led to the IKEA that we see today, so we need to continue that spirit.

JEAN-PHILIPPE COURTOIS:  There’ve been some very significant challenges that I know you faced as a CEO from the global pandemic through to war in Europe, of course, till today, unfortunately. And you’ve expressed before that it’s been a very humbling experience for you, right? So can you talk about what you found most challenging and how you’ve managed to steer the company through those crises and not only to survive, actually to thrive, and to finish with them, I would say how much it has changed your approach to what is called usually crisis management, right, when you got a big challenge happening somewhere in the world globally in the way you actually do your role as a CEO today, Jesper.

JESPER BRODIN:  So these last years have been so challenging, I think, the word for all of us, and definitely for myself as well in this role. I still vividly recall the first week of the pandemic. You know, we all go through the cycle of change. First it’s in denial, then it’s in irritation, then the true grasping of the seriousness of the situation and how it was disrupting all the plans and the model of IKEA, if you like. So I’m not typically a person that have difficulty sleeping, but I can tell you there were a couple of days and weeks in the early phase of the pandemic, where the predictions having at the moment I think we had out of 450 stores only 20 were open, and we were predicting massive red. And with no exaggeration, we were seeing as an area of layoffs and closures and basically a threat to IKEA’s existence. So the interest in learning, I think, is maybe one is this speed of accepting change, right, if you’re good at that and if you have the motto of, of course, hoping for the best but expecting the worst, and then I think what was so cool with the IKEA network was that we realized we don’t have a map for this situation. There is nothing in the drawer to help us, but we have a good compass with our values. So we basically took the decision with all our leaders to say do what’s right. We were basically dictating to say that the plans, the two years, two and a half years plans we had for online, we said to the organization it would be nice if you could do it within six weeks.

JEAN-PHILIPPE COURTOIS:  Six weeks, wow.

JESPER BRODIN:  And of course the cool thing was we were actually capable in most places to do that, so, at that time, actually, okay, I didn’t have online. We had one or two markets experimenting, but digital, everybody. I mean, the top managers were out with masks on and packing goods in our stores. We converted all our stores into fulfillment centers and luckily, since we had listened to our customers two years earlier, we actually had started the service setups and the online capabilities digitally, otherwise we would have been in deep problems. So basically unions, everybody was there to say now we actually roll up our sleeves, and we save the company together. So I think six to eight weeks later, we were actually—I give you one example in a very interesting moment, because, in the early stages, we were actually, as furlough was proposed from many governors, we were signing up for that. Eight weeks later, we said we’re going to make it, we’re going to not make a lot profit, but we’re going to be in the black, and we actually had a moral discussion say it’s wrong for us that give the furlough to somebody else, so we actually reversed furlough in all markets.

JEAN-PHILIPPE COURTOIS:  That’s amazing.

JESPER BRODIN:  Thank the government and said we actually don’t need this. And funny thing, in many legislations, it has never happened before, so it was a new experiment, so that was a humbling moment, I must say.

JEAN-PHILIPPE COURTOIS:  I’m sure. I mean, amazing experiences in two different ways. You said, first, it’s about empowering your people and having confidence in their decisions during the pandemic, saying you guys know what’s going on in Poland or Mexico or Sweden or France. You take the decision, take care of the people and customers and so on, and, number two, you probably made a switch clearly to e-commerce strategically that may not have ever happened. I don’t know, right? In terms of the slowness you had.

JESPER BRODIN:  I think it would have taken many more years, so, in a way, with all the respect of the human suffering of the pandemic and the crisis, the pandemic helped IKEA to become omnichannel in more than double speed. And you can say today we are, you know, we are doing about a quarter of the business online. I wouldn’t say it starts to flatten out like that, but you can say in metropolitan areas, we’re up to 50%, but we now only have it in place with services and distribution. We found the IKEA modeling in doing it in an effective way, so it’s scalable, actually, so our fear was that it would be economically challenging. But we have found a way to make it actually not only helping our topline but actually drive economics through the company. And absolutely the pandemic was the catalyst, because it became a survival factor for us.

JEAN-PHILIPPE COURTOIS:  Very interesting and insightful actually crisis opportunity. You know, I’d like to shift gears now, Jesper, and talk about some of the other developments you’ve made with IKEA. As we record this episode, we’ve been experiencing in Europe and many parts of the world one of the very warmest summers and years ever. And, as a company, you’ve set some very ambitious targets around sustainability, and you said in different instances that this is your top priority. I was interested to read the introduction you wrote for the business of building a better world, the leadership revolution that is changing everything, or you talk about this decade being crunch time for companies and governments. And, as a reminder for listeners, IKEA’s vision is to create a better everyday life for the many people, and you want to inspire and enable one billion people to live healthier and more sustainable lives within the limits to the planet by 2030, which is a very exciting vision. So now from vision to reality, Jesper, can you tell me about not just of course the targets you’ve set for the company, but could you share with us the three most challenging and controversial decisions you had to make as the CEO on how to help to make real progress towards IKEA becoming a net zero company? So beyond the statements, what have you done and what have you found super hard to do, to make it happen?

JESPER BRODIN:  From an ethical perspective, knowing what we know today, and we all regret that back 30 years ago we had absolutely no understanding or even 20 years ago, no real conception of the damage that we are causing to the planet and ourselves. So that is, of course, gave us a very late start to everything. That’s why this decade, this is it, this is the biggest existentialistic moment for humanity to get this right, so, from a moral perspective, no, we cannot hand this over to the next generation. Secondly, if I look at IKEA’s customer base, we have recently done the updated study of interviewing 33,000 people in 30 markets, and the awareness of climate change and the worry is way now above 70. There is no place below 70. It’s very consistent, from US to China to Germany and so forth.

JEAN-PHILIPPE COURTOIS:  Everywhere.

JESPER BRODIN:  If you go down in generations, it increases. And, as such, it’s very clear that our customers expect us to be a leader. That’s going to increase. And I think people will start deselecting brands who are not doing whatever they can. It doesn’t have to be perfect, but you need to have the intent. The third, an interesting aspect that people misunderstand over and over again is that this should come at a premium. It’s very clear from our customers to say we expect you to fix this, we don’t have the money to pay extra for this. You need to find a way to do it, so we have accepted that. One of the difficult decisions is maybe about belief. So because typically CEOs and companies want to have a plan before you commit to something. And, in this case, I think IKEA, who’s known for wanting that, have actually been brave in saying that even if we don’t have all the details right, we don’t have the time not to commit, so we need to believe in that we can get this right. I do believe there has been difficult decisions to commit—

JEAN-PHILIPPE COURTOIS:  Yeah, give me one.

JESPER BRODIN:  --without having all the answers.

JEAN-PHILIPPE COURTOIS:  Give me one of such decisions you made that you could share obviously with our listeners that has been not easy to take with your employers and people.

JESPER BRODIN:  We decided a few years ago to cancel our total light source business, in the incandescent lighting bulbs and so forth. It’s big business, big margin, and we decided it must be wrong, with the knowledge we had of climate change and whatnot, so we went for LED, and, at that time, the prices of LED were I think twentyfold, compared to today, so we took that bet, hoping that we would be able to scale up and make a good business case, which we were capable to do. Looking at the business today, that was absolutely a brilliant decision. But, at the moment, it felt like almost careless from a business perspective, and we were criticized for that decision internally. It turned out to be the right thing to do. I’ve had similar when we developed the code of conduct, which actually leads back to the days of Pakistan and the years shortly after we developed a code of conduct in IKEA with about 80 questions on both sustainability from a people and planet point of view. There was a deep worry that we would become more expensive. Interesting enough, motivation grow, productivity, quality, there were so many effects that actually helped us do the opposite to take out cost from the value chain, so I would say my experience and my advice to people is if it is the right thing, the thing that wants to happen, you have to trust that the economic sense will be there. And I do believe in all of these hesitation that happens in so many places currently and waiting with the investments and so forth, this is a game of too early, too early, too late.

JEAN-PHILIPPE COURTOIS:  Or too late, yeah.

JESPER BRODIN:  And you need to pick the right too early. You don’t want to be in the too late area, and that means you need to take some personal risk as a leader as well, of course.

JEAN-PHILIPPE COURTOIS:  I like to just pose for a moment and pick up on a point Jesper is making. It’s a wonderful reinforcement of the need for risk taking. The climate emergency demands action from all of us, and, when you think about the sustainability commitments, some companies are taking or not taking, hesitating in many places, waiting for investment and so forth. There probably needs to be more risk taking starting at the very top. In recent years, there’s been a growing emphasis across the world of measuring a business impact on society. The environment in transparent and accountabilities, backed up by the coming reporting and requirement from the EU, the so-called corporate sustainability reporting directive, which will require thousands of companies to report. On the previous podcast episode, I talked with Sir Ronald Cohen, who highlighted the need for shift towards impact investing and importance of accurately measuring impact. Jesper has talked about economic benefits he’s seeing from the choices he’s made to reduce his carbon footprint. You get those LED light bulbs as an example. But I want you to know how he sees the role of measuring impact and how he balances that with his profitability promise to shareholders.

JESPER BRODIN:  I think, yeah, and I’m deeply convinced that the profitability will come by being on the right side of the economic transition, and, by the way, it was the right side of humanity, but you can say that this is definitely a topic that needs fact based approach, so you can say the starting point, and my encouragement to all companies, if you don’t yet have that in place, is to make your what the technical term of scope three analysis of your footprint, carbon footprint, so that will then, in IKEA, it’s quite easy to understand, in a way. You can say scope three is like everything, so, in the IKEA point of view, the upstream would be raw material, production, transportation. You have retailing. You have customer transportation, and you have use in life atonement finally after life, so there seven siloes, if you like, and then you need to know what is the carbon impact, so you don’t act blindly on what your gut tells you. For instance, a lot of people, including myself, thought that transport would be the biggest contributor for carbon, which it’s not.

JEAN-PHILIPPE COURTOIS:  It’s not the case.

JESPER BRODIN:  So in our case, it’s actually 50% raw material is the big aspect. One reason it’s 50% is because also we have been faster in addressing some of the other ones. So what you need to do, you need to have the fact-based approach. You need to target the different areas with different solutions, and then interesting enough, you know, reap the economic benefits of such as well, and then I would say there is certain aspects which I think more and more people are also wakening to that these different aspects are connected, so circularity connects all of them. If you crack circularity, you can actually get benefits in more of these dimensions. So definitely, as the world to your question is speeding up, legislation, we working together in world economic forums, climate alliance, we advocate for simplicity, and an alignment, of course.

JEAN-PHILIPPE COURTOIS:  Alignment, yes.

JESPER BRODIN:  This is an area that invites to technicality, technocracy, bureaucracy, and it’s an area where there can be in the worst case that companies need to have different reporting regimes, while everybody’s at the essence trying to strive for the same thing, so we welcome the reporting. We welcome the transparency, but we also want a bit more collaboration to simplify and align across borders.

JEAN-PHILIPPE COURTOIS:  Across boarders and across legislation as well. I’d like to come back to one point you made, because I think it’s one of the big bets you are doing, underpinning your sustainability commitment. Building a full circular iconic model and 100% of your products circular by 2030, I think that’s one of your strategy goals. So what does it actually mean to share with our listeners who are not necessarily experts in circularity, Jesper, and can you give us a concrete example of one of circular products that your consumers buy from IKEA today? And how do you plan then to systematize the circularity model to everything you produce yourself and then you service after the products are being used by the customers?

JESPER BRODIN:  It’s hard work. To some extent, it’s a total transformation of the economy, if you like, but if I start, at the end, it’s an interesting area, because it’s riddled by myths. One of the myths is that we should stop consuming, if you say, or the aspect of that consumption is bad, which is it, so the interesting thing is from a climate science point of view or fact-based point of view, one of the mitigations is of course reducing unnecessary consumption, prolonging life, supporting secondhand. All these tactics, if you like, are part of our climate plan, but, at the essence, in a growing world population, you have to address the core consumption. If you think about the simplicity of by 2050 we need to be at net zero, so does that mean we would have consumption by 2030 and then have zero consumption by 2050? No, of course not. That would be the end of humanity. We can’t eat, sleep, etcetera. So we cannot abandon the core of consumption itself, and, if I give you, I have several great examples from vegetables to whatnot, but one of the coolest is we have recently the last four or five years in a collaboration with the Dutch government addressed taking back mattresses. So mattresses might be 8% of our sales or something, but maybe double in climate footprint is quite bulky and materially intense. Now, the interesting thing is we—it was difficult for us to find economy in bringing back these products and make new, because the system didn’t allow for it. So what happened was that the Dutch government went in to stop subsidizing incineration of mattresses and then imposed a law to say that you have to drop your old mattress on a collection point. Now, imagine, 17 million people, in average a mattress is 10 years, so 1.7 million mattresses per year goes to incineration. Now, we set up a system, and today we expanded it to four units. We have a capacity to take back every mattress in Netherlands, not only our share, and here comes the good news. It’s good business. So when we break up the polyester, the foam, the metal, we sell it back into the supply chain to make new products. It’s actually not the best business I’ve ever seen, but it’s actually making a lot of business sense. And thereby, you’re not prolonging the life of mattresses only or minimizing unnecessary, and, by the way, very few people buy mattress on a spontaneous level, right, it’s a necessity driven purchase. So now we are capable through plugging in EV, transport in the logistics side, to actually create a consumption solution for mattresses that is climate neutral, which is amazing. So when people say this is a vision or an idea but it’s not realistic, here you have one of the cases. And, if I may, Jean-Philippe, because I think this is important, people have hard to believe that it’s possible you have to sacrifice growth for decoupling carbon, so IKEA since 2016 report a sales increase of 24.8%, so we’ve grown since then. We reported decoupling of carbon of absolute minus 13.6. So it’s not relative. It’s absolute. So that’s one example to say it seems to be a good idea to grow and decouple carbon. So basically we are currently updating our goals, because we’re almost at the regional 2030 goal. We also need to update that because of new insights in science and so forth, but it gives me hope that decupling carbon is a good business idea, actually.

JEAN-PHILIPPE COURTOIS:  Well, wonderful example you took, and you share with all of us, Jesper, of circularity, and I’m sure you’re busy doing that on every products and changing the mix of your materials as well to, again, get to that net zero IKEA even sooner than later. It looks like you’ve got a plan, actually.

JESPER BRODIN:  We do. And it’s humbling. In some areas, it’s easier. Some it’s—

JEAN-PHILIPPE COURTOIS:  Super hard.

JESPER BRODIN:  Still we’re looking for the answers. As you said, it might even be that we need to abandon some of the materials and find new solutions. So some of it is not easy, but we definitely the 50% target 2030, which is the one that we spent most time on right now, it seems to be in our reach.

JEAN-PHILIPPE COURTOIS:  So one of the ways, Jesper, to get inspiration but also to get some real solution I found myself and within Microsoft and outside Microsoft with my different roles is to partner with change makers, social entrepreneurs, what is being called is this impact entrepreneurs around the world. There are a number of wonderful companies with Northstar is all about having a positive impact in the world. So your company has a long tradition, and actually  we are partnering together with WEF Foundation with this World Economic Forum Alliance for Social Entrepreneurship to ensure that big enterprise can not only get inspiration but actually can procure product services from certain entrepreneurs, so can you tell us more about how IKEA’s been involved and is involved with social entrepreneurs and impact entrepreneurs around the world, both in terms of strategy, but also end zone experimentation products, and what do you expect from that in the future?

JESPER BRODIN:  Well, there are different exciting opportunities. I think one of the starting points for us to address social entrepreneurs, we had the opportunity to invite the now late Professor Hans Rusling, who was I think the mastermind of understanding long term demographic changes and an optimist of rank. He came to us, and he took addition of serving the many people, and he pointed at the gap. He said you had, on one hand, you have your customers, you have yourself, your suppliers. Then you have nothing, and then you have IKEA Foundation who basically do philanthropic work for the people who have the least, maybe. But he pointed us in a direction to say there are so many people who the barrier to be a big supplier is just too big. So we started a social entrepreneurship in two ways. One was actually in the close to our retailing where we work, for instance, with maybe there can be an entrepreneur who works with stitching or giving services to IKEA products. They could be circularity, secondhand, and so forth. And the second was basically to look into offer job opportunities for people through creating products, sometimes more handicraft related. The point was though to see that other people have an opportunity to build something from the ground, which is basically a program that we all supplied together with IKEA Foundation’s direction. We actually did, for instance, set up such an entrepreneurship in Jordan. Was one of my favorite projects to actually offer job opportunities to refugees from Syria from the crisis. So, in a way, you can say it serves a social mission quite well. It gives us an opportunity to learn. Then you have the total other end, of course, where we are investing into new technologies. We recently I think yesterday announced a collaboration with H2 Steel to basically now introduce green steel in all our properties and real estate, so that’s not a social entrepreneur, but it’s an entrepreneur who starts from very little and as a vision about the new economy, which we like to support.

JEAN-PHILIPPE COURTOIS:  I think we need both, actually. We need both the social entrepreneurs and also from I would say innovation-led companies. I like to finish a couple of questions, because on leadership, going back to leadership discussion we had early in our days, in an article you co-wrote for Fortune a couple years ago, you said that we need to scrub the old leadership model and replace it with one that places humanity, humility, and brave action at the heart of everything we do, which is something I totally agree with. Indeed, I recently had Steven M. R. Covey on a podcast to talk about his latest research on leadership, a new model that he’s explored and written about in his book Trust and Inspire, and your leadership style is very resonant of the ideas he proposes. What he said is, in Trust and Inspire, it’s about a new way of leading that starts with a belief that people are creative, collaborative, and full of potential. People with this kind of leader are inspired to become the best version of themselves and to produce their best work. People don’t want to be managed. People want to be led. So how do you see this new way of leadership developing in one of the most important lessons leadership you’ve learned along the way to, well, to become a role model in doing more of that.

JESPER BRODIN:  One of the things personally that I learned to accept and maybe also change my own nature in ways, so to accept dilemmas. I think these days I think when I run into some juicy dilemmas, normally they, you know, make them the best friend, take your time to explore them, expand your horizon, because in true dilemmas lies very often the great opportunities to make an impact. And I do believe myself have come to a point in life. I think I find it totally uninteresting to work for making money or making somebody rich or to drive growth as the only elements. I think the future belongs to I hope and believe to leaders, companies, organizations that has a purpose to serve humanity. I don’t see the contradiction between the business opportunity and doing good. I think that is the new corporate environment that we will look for. Of course, you can say when you talked about Unilever, it started with a beautiful idea. And Microsoft started with a beautiful idea to serve humanity. Of course there is always an entrepreneur and a spirit, but very soon there comes something more fundamental and deep within it, so I believe to a certain extent, managing—maybe step one in leadership is about management and managing things or a team. Step two maybe is leading transformations, Microsoft, like IKEA, have undergone great transformations. You need to have believers, flag carriers. You need to instigate momentum, not perfection. Then I think level three for me, maybe it’s also with the respect of our founder, as the deep insight of understanding that culture is even stronger. So, if you can invest in culture, you will have resilience for the unexpected and tough times. And right now, I’m curiously experimenting what I think might be the next level. And I call it servant leadership. I don’t know if it’s a term like that.

JEAN-PHILIPPE COURTOIS:  Oh, it’s been existing. Yes.

JESPER BRODIN:  I believe it, yeah, but I believe truly that if you take out your own ego and look at what is it actually that you can do and in the servant leadership thinking, it leads you also to believe that the ultimate goal as a leader is that you’re not needed anymore, if you see my point, so how can you contribute to change and building something? And, when you’re done, done basically, it can continue without your energy and passion.

JEAN-PHILIPPE COURTOIS:  Love it.

JESPER BRODIN:  So that’s where I am right now in my leadership development, much left to learn.

JEAN-PHILIPPE COURTOIS:  You know, Positive Leadership podcast, we often talk to leaders, all kind of leaders actually, very different types of people. In the way they find resources in themselves to create a positive energy, and I’d like you to talk about the way you create your moments of calm in your day, the way you relax and unwind. I understand you re a sailor. I understand that I’ve been recently in the islands in Sweden, you need to be a good sailor, but also you love music. As a matter of fact, you play guitar. I understand you play actually really well guitar, and you’ve said before that playing guitar is your yoga, and you do it every day. So tell me about your guitar practice. Are you in a band? What kind of music do you play? And how does it help you create positive energy, not just within yourself but with others, right, in your days, in your weeks, when you have some tough decisions to make?

JESPER BRODIN:  It’s an important quality, to be able to be self-generating of positive energy. For me, originally, introverted nature, it means that I need time for myself, need time to focus, so I think if I look at the hours I play guitar, I’m absolutely hopeless. I should have been much, much better at this point, but I’m currently the lead singer in a heavy metal band, the best heavy metal band in Hong Kong, yes, yes. And we haven’t met in a while, I have to admit, but the band members are still there, and we’ve had a lot of fun. Yeah, I do believe it’s important to find your source of recuperation and focus, and, again, music for me works like meditation. My wife is a yoga teacher, and she helps me with meditation, but music works like the best meditation, because it totally relaxes the mind and shifts my focus to something else. So I’ve loved that. That’s my hobby, and that’s my way of getting a moment of recuperation, so definitely.

JEAN-PHILIPPE COURTOIS:  I can feel it.

JESPER BRODIN:  And there is a lot of people who share that, by the way.

JEAN-PHILIPPE COURTOIS:  Now my real last question, because I know you are super busy, Jesper. You know, we are in 2023, so what would be your coaching message, 2023, for young 25 years old Jesper, starting his professional career? Not necessarily in IKEA, in any place in the world, maybe in Sweden, maybe in Pakistan or somewhere else. What do you think are the most meaningful life lessons, leadership lessons you’ve had to share back with this young Jesper to apply in his life in 2023 as he gets started, what would that be?

JESPER BRODIN:  Wow, what an opportunity. I have 25 advice now. To keep it short, you know, I think the advice I would give to myself would be twofold, I think. Don’t worry so much. I would tell myself. I think when I look back over the years, I worry too much about the future and so on. As such, I think breathe the optimism within yourself, and it will guide you to the right places. And I think then finally that’s very related to my mother’s old advice to try to look for the things you’re good at. If you don’t find it, keep trying. And then find the place where you’re really happy, and, if you find both, that is a career. Forget about titles, forget about money. All of these things will come, so look for what you’re good at, and look for what makes you happy.

JEAN-PHILIPPE COURTOIS:  One of the things that really struck me about this discussion is Jesper’s openness and authenticity, and it’s telling that it should come back to his mother’s advice there, that he should place such value on the pursuit of happiness, taking time to nurture yourself, to seek joy in every experiences keeps you healthy and brings you strength. You’ve been listening to Positive Leadership podcast with me, Jean-Philippe Courtois. If you’ve enjoyed today’s episode, please give us five stars on Apple Podcast and click the share button you have to send episode to many of your friends. If you’re looking to start a journey of personal growth and positive impact, why not head to my LinkedIn page and sign up to my monthly newsletter, Positive Leadership and You. Thanks so much for listening. Goodbye.