One of the most important objectives that the European Union is seeking involves a circular economy. Based on the United Nations Sustainable Development Goals (UN SDG), which focus on achieving circular business models to reduce human climate fingerprint, the EU is regulating several industries, such as the textile industry, and developed the Ecodesign for Sustainable Products Regulation or ESPR, which one of its most relevant points is the Digital Product Passport or DPP.
According to the World Business Council for Sustainable Development, the EU DPP is:
“The DPP is a tool to create transparency and unlock circularity proposed by the European Commission (EC) that will share product information across the entire value chain, including data on raw material extraction, production, recycling, etc.”
WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT, 2023
The motivations for the European Commission Digital Passport are:
- Ensure products’ transparency and traceability and share their essential information about circularity and sustainability.
- Creating new business opportunities for circular economic business models.
- Empower society’s decision choices with information about what they consume.
- Allowing authorities to verify compliance with legal requirements.
- Ensure the repair rights of consumers.
The European Commission’s Digital Product Passport is expected to be implemented by 2026 per product group, with consumer electronics and fashion as the first ones to require the DPP.
As the textile industry will be one of the first product groups that will require this tool to distribute their products within the European market, fashion brands must implement circular solutions such as Recovo’s marketplace for deadstock fabrics to achieve this objective of turning this industry to a circular model that is necessary to preserve our planet.
EU DPP is going to be shared with consumers by QR codes that will label the following information:
- Raw material sources: Many consumers need to be made aware of the environmental impact associated with raw material extraction and management. Exploitative practices, deforestation, and high levels of carbon sequestration often occur in the undeveloped countries where these materials are sourced, highlighting the need for increased transparency through DPP.
- Design: Ecodesign plays a critical role in lengthening product lifecycles and minimizing raw material extraction and manufacturing environmental footprint. It goes beyond aesthetics, considering durability, modularity, repairability, and end-of-life disassembly for recycling as key points.
- Manufacturing: Manufacturing processes can significantly impact a product’s environmental footprint, contributing to pollution and greenhouse gas emissions. Consumers deserve transparency throughout the supply chain, and therefore manufacturers should be required to declare both their waste management practices and the carbon footprint generated during the manufacturing stage. A good stock and waste management can even reduce costs to companies, adopting SaaS such as Recovo’s option for textile companies reduces manufacturers’ waste production and optimizes manufacturing processes.
- Distribution: Europe relies on imports from various parts of the world which leads to significant carbon emissions associated with transportation. The DPP could play a valuable role in addressing this issue, providing transparency and quantifying the embedded carbon footprint of imported goods.
- Circularity: While many consumers have become accustomed to a ‘buy and discard’ mentality, promoting circular practices like repair and reuse through DPP is key to reducing society’s environmental impact. This responsibility lies with consumers and companies, that must provide data about how to extend their products’ lifecycle.
EU DPP and ESPR are not just taught to safeguard the environment. Companies from all over the world can also benefit from this upcoming regulation. The most important ones are:
- Developing new business models: The adoption of this new Digital Product Passport creates and modifies different business models and offers the possibility to grow to those companies whose capabilities adapt better and faster to this new regulation.
Circularity creates new opportunities for repairing companies or enriching marketing and sales operations due to customer experiences related to repairing or reusing, among others.
- Increase consumer trust: Everything related to companies and product transparency is positive for consumers. Giving extra information to a company’s consumers is positive for them, empowering the reasons why they choose a brand.
- Validate green claims: As greenwashing is a trend for some industry that develops non-ethical marketing strategies, DPP is going to validate those circular claims.
- Consumer Protection: The information given by DPP will ensure quality and sustainability standards. This information can be used by consumers to validate their quality requirements.
- Ensure Compliance: With the newest regulations, the obligation for companies to communicate this information, is going to legitimate and monitor their compliance, and this data will be easily tracked and accessed by authorities.
1. Adopt the newest circular regulations: Adopting the different requirements that the future regulations will require.
2. Evaluate data: Checking the data required for the DPP, their identification, and which ones are actually missing to organize data compilation processes.
3. Company organization: Involucrate and align every department involved in the Digital Product Passport, such as production, IT, marketing, etc., and prepare them for future changes.
4. Plan for the changes in technology: Communicate, prepare, and verify how our technology can assume DPP’s technological requirements changes.
The newest EU circular regulations are going to land in the next months, so companies must adapt to them. Digital Product Passport is one of the most visible changes that industries such as textiles must adopt to ensure consumers’ knowledge to develop new circular behaviors in society.
Companies have ethical and legal obligations to adopt newer ways to develop their operations that drive different ways of producing, manufacturing, and consuming.
The circular economy business model is the future of the European Union model and organizations that operate there must transform the way we have been producing during the last years, where mass production was the main objective and sustainability was forgotten.
Digital Product Passport and the Ecodesign for Sustainable Products Regulation landscape is going to land in the next years, aiming for a greener future for European society.
Recovo creates circular solutions for the fashion industry. We cover various aspects of the circular economy for brands:
Based in Barcelona, we have a global mission with our websites in Spanish, English, Portuguese, Italian, French, dutch, German
If you want to know more, please contact us
