Challenges and recommendations for implementing Digital Product Passport (DPP)

What is a Digital Product Passport?

A Digital Product Passport (DPP) is a digital record containing detailed information about a product, its lifecycle, and sustainability characteristics.

The EU's Proposal of the Eco-design for Sustainable Products Regulation (ESPR), published in March 2022, puts forth the mandatory introduction of digital product passports as a key regulatory component in the upcoming years. The regulation defines product passports as "a set of data specific to a product that includes the information (specified in the correspondent delegated act of the product group) and that is accessible via electronic means through a data carrier."

As a result of the regulation, companies placing products on the EU market must ensure DPP is available for their products. The DPP will apply to all products placed on the EU market, except for food, feed, and medicinal products, and includes products manufactured in Europe and imported into the EU, therefore impacting global trade. The use of DPPs aims to gather data on a product and its supply chain and share it across entire value chains so all actors, including consumers, have a better understanding of the materials and products they use and their embodied environmental impact.

When is DPP going to be implemented? The first delegated acts have already been adopted. This plan identifies a list of priority products for which delegated acts will be applied.

Electronics, textiles, batteries, and furniture are expected to be the most important categories to be addressed first by the Commission. Thirty new delegated acts are expected to be developed by 2030.

How will DPPs impact your business?

Key insights arising from the work carried out so far are detailed below:

Challenges and Recommendations :

The transformative journey of creating and using DPPs is not without challenges. Businesses must address issues of information accessibility, supply chain transparency, and adaptability to dynamic regulatory shifts. dss⁺ has authored four short policy briefs that offer tailored recommendations to navigate these challenges effectively, ensuring a seamless transition towards a circular economy

Lack of "Use Phase" Information:

Gathering consumer data on how items are used and why they are discarded/recycled/repaired is valuable in assessing a product’s environmental impact. For example, our eco-design research for Defra discovered that there is a widely held perception by consumers that having a product repaired by the original manufacturer is more expensive than going to a local independent repair shop. However, the manufacturer must hold spare parts for 5-10 years and so is more likely to offer an effective repair than an independent engineer.

Transparent Supply Chains:

Achieving transparency across supply chains remains challenging. Businesses must prioritise efforts to develop comprehensive material composition information and trace materials, manufacturing processes, and waste management practices. Such information may include the location of components within a product, how to 3D print replacement parts or the type of plastic a product is made from.

Dynamic Regulatory Landscape:

Adapting to evolving regulations requires business agility. Establishing cross-functional teams focused on sustainability and compliance is essential. The creation of feedback channels is critical to ensure the knowledge gained from data sharing via a DPP allows future products to be better designed for circularity.

Government-Industry Collaboration:

Advocate for increased collaboration between governments and industries. This includes dialogue on challenges faced by businesses in implementing DPPs and working collectively towards viable solutions on topics such as verification of accurate input data, alignment with existing legal databases and reduction of administrative burden. For example, a DPP accessed via a QR code may be most consumer-friendly, while a recycler scanning through entire containers of waste products would need a method that allows multiple items to be read at once.

Standardisation Efforts:

Participate in standardisation efforts related to DPPs. Engage with industry consortia and standard-setting organisations to contribute to the development of universally accepted practices, ensuring interoperability and reliability. There will be a need to explore how to link the DPP system to other legal databases (e.g., Digital Building Logbooks, EPREL, SCIP, etc.).

Looking ahead: How can you prepare your business for regulatory changes?

Supply Chain Transparency:

Foster transparent supply chains to enhance traceability and support the goals of circularity. This includes investment in product labelling for recyclers and consumers to encourage the take-up of DPPs and improve the flow of information through enhanced awareness.

dss⁺ is currently working with a data platform provider that uses QR codes to share essential Environmental, Social and Governance (ESG) information with customers and can even track how a product is being used. Our experience in identifying new policies as they arise and interpreting how they impact clients, and their customers, gives them confidence in continuing compliance with the data they provide. Our Strategic Policy Intelligence Capacity Hub can help you identify value opportunities through tailored policy-driven strategies.

Lifecycle Data Management:

Developing comprehensive systems to manage product data throughout its lifecycle is essential. This includes integrating data on material composition, product assembly, repair instructions, and components’ failure rates, enhancing efficiency for both businesses and regulatory bodies. We partnered with Romande Energie, conducting carbon footprint data and assessments to create a roadmap to help Switzerland’s largest open-air festival, Paléo Festival, achieve its decarbonisation objectives.

Adaptability:

Develop adaptive strategies to stay ahead in a regulatory landscape that continually evolves towards sustainability. This includes an enquiring mindset to see how information flows via a DPP can impact business performance. We can support you in this through our Learning and Development Hub which offers a range of training activities. Our dynamic and interactive workshops with high-profile clients in the Italian food and beverage sector, including Skretting, Molini Pivetti, Doxal and Igino Mazzola, facilitated new communication strategies and opportunities to be truly innovative. More details about our workshops are on our website.

Continuous improvement:

Develop collaborative feedback systems and project teams that allow data shared by a DPP to facilitate eco-design reviews, reasons for product failure and insights on issues that hinder repairability or recyclability. We can develop bespoke solutions that empower your business to be truly innovative. Our team created an Assessment Tool that enabled a secondhand car selling platform to determine the point at which it was environmentally better to recycle a vehicle or maintain it to resell to maximise its lifespan.

By embracing the insights provided, businesses can not only navigate the complexities of emerging regulations but also position themselves as pioneers in a circular economy. Contact us to learn more.