By Lars Rensing, CEO of Protokol, DPP Solution Provider.
Although the majority of manufacturers in the EU are likely to have come across the Ecodesign for Sustainability Products Regulation (ESPR), its Digital Product Passport (DPP) mandate, and the pivotal impact it is soon to have on business activities and outputs, many still haven’t started preparing, often due to not knowing where to start. However, tackling data challenges as an initial action point, by identifying and validating sources, will enable firms to start their compliance journey now and position themselves effectively for the challenging road ahead.
The ESPR legislation: A brief recap
As an aspect of the EU’s Circular Economy Action Plan (CEAP), the ESPR’s main goal is to boost economic circularity and sustainability by providing a framework that aims to make sustainable products the new norm in the EU. With a focus on products ‘lasting longer, using energy and resources more efficiently and making them more easily to repair and recycle’, alongside a range of other key points, the ESPR is set to impact a range of select industries and products that are currently deemed to have the bigger impact on the environment - including the electronics and textiles sectors - and will apply to all businesses placing products in these groups into the EU market.
As part of this, the implementation of Digital Product Passports (DPPs) - a digital record of a physical product, securely keeping track of event, transactional, and sustainability-based information across that product’s lifecycle – will be mandated.
The delegated acts, which will likely specify the guidance for what data will need to be included for DPPs in each key industry and product group (e.g. water usage, carbon emissions during manufacturing), are yet to be announced. However, the first critical step toward compliance is already clear: collecting and validating data on a product's environmental impact to populate the DPPs with accurate information.
This process presents significant challenges, as product and sustainability data is often scattered across an economic operator's value chain, residing in fragmented internal and external systems. Even when data is sourced, validating it and determining a single source of truth can be complex.
To get ahead of these challenges, businesses should proactively start identifying and mapping their product data in preparation for the mandate.
Outlined below are six key steps manufacturers can take to begin their journey today:
1. Prioritising stakeholder discussions to assess your starting point
As an initial action point, businesses should begin to collaborate with stakeholders across the supply chain, including suppliers, and logistics partners, to assess the product data already available. These conversations may reveal previously overlooked information and open the door to improving data transparency and accessibility.
2. Undergoing a data gap analysis to pinpoint missing information
Once the data that exists has been collected, a data gap analysis is the most coherent next step. This will consider the data points that are highly likely to be required in a DPP (ahead of the specifics being confirmed via the delegated acts).
This analysis may focus on information concerning the waste generated during the production of a product or the carbon footprint of the manufacturing process. Conducting this exercise will enable businesses to understand where the data gaps currently are, so they can find ways to close them whether that’s integrating measurement tools or engaging new partners to support.
3. The power of a Life Cycle Assessment (LCA) audit to fill data gaps
Conducting a Life Cycle Assessment (LCA) once data gaps are identified should be the next priority. This process measures the environmental impact of a product’s lifecycle and can start from the point of raw material extraction to provide a complete view. The insights from a LCA can streamline the process of populating DPPs with accurate, relevant data, such as carbon footprint and resource use.
4. Validating data sources for accuracy and ease of mind
During the steps above, it is important to validate data sources to build an accurate, verifiable picture of each product. This means assessing the credibility of third-party data suppliers, and ensuring processes are underpinned by the relevant standards.
5. Picking a DPP solution that easily integrates with existing systems
Due to the complexity involved in DPP solutions, building one in-house won’t be a viable option for most businesses, so they will need to seek out suitable partners who specialise in the creation and implementation of DPPs with their specific challenges in mind.
Businesses should also evaluate whether the DPP solution seamlessly integrates with their existing systems and provides a continuous, real-time view of a product's lifecycle.
6. The importance of piloting to analyse and evaluate
Once the above has taken place, the most valuable step would be to pilot the process and test implementation. Through a pilot, businesses will be able to stress-test processes while capturing data to have a more accurate picture of the scale and timeline needed for the full task to be completed.
Through this, manufacturing firms will be in a better, more knowledgeable position to galvanise their compliance efforts once the delegated acts are announced.
Kicking off the journey towards ESPR compliance
Despite the uncertainties around the release of the delegated acts, manufacturers can take a proactive approach to DPP compliance by implementing practical, step-by-step actions. By developing a robust compliance strategy based on accurate data and reliable validation processes, manufacturers can not only prepare for the ESPR’s DPP mandate but also improve sustainability practices and strengthen operational resilience.
