Sustainability: Ikea, Patagonia and Unilever put to the test

Sus­tain­abil­i­ty has become ubiq­ui­tous in cor­po­rate dis­course. It is defined by the UN’s 1987 Brundt­land Com­mis­sion as “meet­ing present needs with­out com­pro­mis­ing future gen­er­a­tions’ abil­i­ty to meet theirs”. Yet trans­lat­ing this prin­ci­ple into authen­tic busi­ness prac­tice remains elu­sive. Most com­pa­nies grap­ple with com­pet­ing pres­sures: share­hold­er expec­ta­tions for prof­it max­imi­sa­tion, entrenched oper­a­tional sys­tems, and the struc­tur­al con­straints of scal­ing sus­tain­able prac­tices across com­plex glob­al operations.

Tra­di­tion­al mea­sure­ment tools like ESG rat­ings and the triple bot­tom line frame­work cap­ture impor­tant aspects of cor­po­rate envi­ron­men­tal per­for­mance, but they fall short of reveal­ing whether sus­tain­abil­i­ty is gen­uine­ly embed­ded in strate­gic deci­sion-mak­ing or mere­ly lay­ered on as an after­thought. These met­rics often serve exter­nal stakeholders—such as, investors and regulators—rather than pro­vid­ing action­able insights for inter­nal transformation.

To address this gap, we devel­oped the Sus­tain­abil­i­ty Mir­ror Frame­work, a diag­nos­tic tool that cat­e­goris­es cor­po­rate sus­tain­abil­i­ty actions into three dis­tinct types based on their under­ly­ing moti­va­tions and beneficiaries:

• Steered Actions: Ini­tia­tives that pri­mar­i­ly ben­e­fit soci­ety or the envi­ron­ment with min­i­mal direct busi­ness returns. These rep­re­sent gen­uine altru­ism but may be vul­ner­a­ble to cost-cut­ting dur­ing eco­nom­ic pressures.
• Embod­ied Actions: Strate­gies that simul­ta­ne­ous­ly advance envi­ron­men­tal or social goals while strength­en­ing busi­ness per­for­mance. These cre­ate self-rein­forc­ing cycles, where doing good becomes inte­gral to com­pet­i­tive advantage.
• Anchored Actions: Activ­i­ties pur­sued pre­dom­i­nant­ly for busi­ness ben­e­fit, even when framed in sus­tain­abil­i­ty lan­guage. While not inher­ent­ly prob­lem­at­ic, high con­cen­tra­tions of anchored actions may sig­nal greenwashing.

The frame­work eval­u­ates com­pa­nies across four crit­i­cal dimen­sions: sus­tain­abil­i­ty prac­tices, ecosys­tem rela­tion­ships (with sup­pli­ers, com­mu­ni­ties, and part­ners), envi­ron­men­tal impact, and inno­va­tion approach­es. We applied this frame­work to analyse Patag­o­nia, IKEA, and Unilever—the top three com­pa­nies in the 2023 GlobeScan–Sustainability Lead­ers Sur­vey. All three have demon­strat­ed pub­lic com­mit­ment to ambi­tious envi­ron­men­tal goals, includ­ing sign­ing a 2021 pledge to decar­bonise ocean ship­ping by 2040. Our analy­sis exam­ined over 250 pages of offi­cial com­pa­ny com­mu­ni­ca­tions to assess their strate­gic and oper­a­tional messaging.

Patag­o­nia emerged as the clear leader in sus­tain­abil­i­ty embod­i­ment, with 64% of assessed actions deliv­er­ing mutu­al ben­e­fits to both soci­ety and busi­ness, while only 12% were clas­si­fied as anchored. This remark­able align­ment man­i­fest­ed across all dimensions:

• Sus­tain­abil­i­ty (42% embod­ied): From regen­er­a­tive organ­ic cot­ton sourc­ing to aggres­sive cli­mate advo­ca­cy, Patag­o­nia has made envi­ron­men­tal stew­ard­ship insep­a­ra­ble from brand identity.
• Ecosys­tem rela­tion­ships (77% embod­ied): The com­pa­ny’s fair-trade part­ner­ships and sup­ply chain inno­va­tions cre­ate shared val­ue with sup­pli­ers and communities.
• Inno­va­tion (60% embod­ied): Prod­uct devel­op­ment con­sis­tent­ly focus­es on dura­bil­i­ty, repairabil­i­ty, and regen­er­a­tive materials—features that reduce envi­ron­men­tal impact while com­mand­ing pre­mi­um pricing.

Patag­o­ni­a’s suc­cess stems from sev­er­al struc­tur­al advan­tages: its rel­a­tive­ly focused prod­uct port­fo­lio, mis­sion-dri­ven gov­er­nance struc­ture, and cul­ti­vat­ed con­sumer base that val­ues envi­ron­men­tal respon­si­bil­i­ty enough to pay pre­mi­um prices. These con­di­tions enable the com­pa­ny to avoid the tra­di­tion­al trade-offs between prof­it and purpose.

Unilever achieved 48% over­all embod­i­ment, which is a respectable per­for­mance giv­en the com­plex­i­ty of oper­at­ing across diverse mar­kets and prod­uct cat­e­gories. The com­pa­ny demon­strat­ed bal­anced progress across dimensions:

• Sus­tain­abil­i­ty (34% embod­ied): Ini­tia­tives like halv­ing plas­tic pack­ag­ing while main­tain­ing growth tar­gets exem­pli­fy the chal­leng­ing bal­ance between envi­ron­men­tal goals and busi­ness imperatives.
• Ecosys­tem rela­tion­ships (72% embod­ied): Exten­sive pub­lic-pri­vate part­ner­ships and com­mu­ni­ty devel­op­ment pro­grams cre­ate gen­uine shared value.
• Inno­va­tion (50% embod­ied): New prod­uct devel­op­ment increas­ing­ly aligns con­sumer pref­er­ences with envi­ron­men­tal ben­e­fits, though 38% of inno­va­tions remained anchored, reflect­ing ongo­ing ten­sion with share­hold­er expectations.

Unilever’s expe­ri­ence illus­trates the inher­ent chal­lenges fac­ing large multi­na­tion­als: diverse reg­u­la­to­ry envi­ron­ments, com­plex sup­ply chains, and het­ero­ge­neous con­sumer pref­er­ences make achiev­ing uni­form embod­i­ment sig­nif­i­cant­ly more dif­fi­cult than for spe­cialised com­pa­nies like Patagonia.

IKEA scored 44% over­all embod­i­ment, with notable vari­a­tions across dimen­sions that reveal the ten­sions with­in its busi­ness model:

• Sus­tain­abil­i­ty (36% embod­ied): Cir­cu­lar design prin­ci­ples and renew­able ener­gy invest­ments demon­strate progress, but the com­pa­ny’s high-vol­ume, low-cost mod­el cre­ates struc­tur­al constraints.
• Ecosys­tem rela­tion­ships (60% embod­ied): Strong col­lab­o­ra­tive sup­ply chain projects, though 27% of rela­tion­ships pri­mar­i­ly served IKEA’s oper­a­tional effi­cien­cy rather than mutu­al benefit.
• Inno­va­tion (34% embod­ied): The low­est score among the three com­pa­nies, reflect­ing how mass-mar­ket posi­tion­ing can lim­it oppor­tu­ni­ties for trans­for­ma­tive prod­uct redesign.

IKEA’s results high­light a crit­i­cal chal­lenge: even well-inten­tioned sus­tain­abil­i­ty ini­tia­tives can become “anchored” when con­strained by estab­lished busi­ness mod­els that pri­ori­tise afford­abil­i­ty and scale over envi­ron­men­tal optimization.

The Sus­tain­abil­i­ty Mir­ror Frame­work reveals that cor­po­rate sus­tain­abil­i­ty exists on a spec­trum rather than as a bina­ry choice. Even lead­ing com­pa­nies demon­strate mixed pro­files, with vary­ing degrees of gen­uine inte­gra­tion ver­sus strate­gic positioning.

For cor­po­ra­tions, the frame­work pro­vides a diag­nos­tic tool for iden­ti­fy­ing oppor­tu­ni­ties to expand embod­ied actions, those rare strate­gies where envi­ron­men­tal and social ben­e­fits rein­force busi­ness suc­cess. This requires mov­ing beyond inno­va­tion labs and car­bon off­sets toward fun­da­men­tal busi­ness mod­el redesign that makes plan­e­tary health insep­a­ra­ble from prof­it generation.

For pol­i­cy­mak­ers, these insights can inform more sophis­ti­cat­ed reg­u­la­to­ry approach­es that incen­tivize embod­ied actions while recog­nis­ing the struc­tur­al chal­lenges fac­ing dif­fer­ent types of com­pa­nies. Rather than one-size-fits-all man­dates, pol­i­cy could be tai­lored to com­pa­ny char­ac­ter­is­tics and mar­ket contexts.

For investors and con­sumers, it sharp­ens the abil­i­ty to dis­tin­guish between com­pa­nies whose sus­tain­abil­i­ty efforts are deeply inte­grat­ed ver­sus those whose ini­tia­tives, while gen­uine, remain periph­er­al to core busi­ness strategy.

The ulti­mate goal is not to achieve per­fect embod­i­ment, which is an unre­al­is­tic stan­dard. But rather to sys­tem­at­i­cal­ly expand the pro­por­tion of busi­ness activ­i­ties that cre­ate pos­i­tive-sum out­comes for soci­ety, envi­ron­ment, and share­hold­ers. This requires acknowl­edg­ing that sus­tain­abil­i­ty inte­gra­tion is not just a mat­ter of cor­po­rate will, but also of struc­tur­al con­di­tions includ­ing mar­ket dynam­ics, reg­u­la­to­ry frame­works, and con­sumer preferences.

Com­pa­nies like Patag­o­nia demon­strate that high embod­i­ment is pos­si­ble under cer­tain con­di­tions, while Unilever and IKEA show both the poten­tial and chal­lenges of scal­ing sus­tain­able prac­tices across com­plex glob­al oper­a­tions. The key insight is that sus­tain­able busi­ness mod­els are not dis­cov­ered through good inten­tions alone, but through delib­er­ate struc­tur­al changes that align prof­it incen­tives with plan­e­tary health.

The Sus­tain­abil­i­ty Mir­ror Frame­work offers a path beyond the polarised debate between prof­it and pur­pose, toward a more nuanced under­stand­ing of how com­pa­nies can gen­uine­ly inte­grate sus­tain­abil­i­ty into their core oper­a­tions. In an era where cli­mate change demands urgent action, such diag­nos­tic tools become essen­tial for dis­tin­guish­ing authen­tic trans­for­ma­tion from sophis­ti­cat­ed greenwashing.

For more info

Juin, C., Geor­get, V., & Ray­na, T. (2025). Busi­ness Mod­el Inno­va­tion: a Frame­work for Assess­ing Cor­po­rate Engage­ment with Sus­tain­abil­i­ty. Cir­cu­lar Econ­o­my and Sus­tain­abil­i­ty, 1–23. https://doi.org/10.1007/s43615-025–00565‑9