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Posts tagged 'EPD'

Consumers don’t read CR reports

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CR reports can be useful for sustainability wonks and some NGOs. But most customers don’t read CR reports.

Both consumers and business-to-consumer (B2C) customers are not interested in the company; they’re interested in its products they buy. They want to know about the environmental impacts of the products they are buying, such as how much carbon, toxicity or recycled content they have, and publishing an EPD provides that information in a validated way.

However, an EPD can be quite a technical document that few people will understand. But you don’t communicate the actual certificate, you communicate data. For example, one way to make this information digestible is to use a magic metric that neatly summarises the impacts. This puts the information in customers’ hands to help them choose a more sustainable product.

If you are buying company cars, you no longer have to worry about how many ISO 14001 compliant factories BMW has, or what kind of score it has registered with the Carbon Disclosure Project.

You simply look at the g CO2/km metric for the car you’re buying. 

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Supermarkets should be accountable for products, not just their buildings

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A supermarket should take accountability for the products that go through it, not just its buildings.

Which environmental impacts, for instance, should a retailer be accountable for and report on?

The environmental impact of a supermarket extends well beyond the doors of its stores to include the impacts of all the products it sells. These occur before and after the products enter and leave the stores in their production, their use and their disposal. Yet conventional corporate reporting would largely ignore anything that happens outside of the store, apart from a few cherry-picked case studies.

By taking accountability for the impacts of products across their lifecycle, retailers can gain a much better idea of their overall impact on society and of the type of products they might want to sell. Arguably, it was this kind of approach that led the do-it-yourself retailer B&Q to stop selling patio heaters. A traditional CR approach would not have registered the significant environmental impacts of patio heaters in their use phase. Ikea is now assessing its products based on a sustainability product scorecard to assess the lifecycle impacts of its products, including waste, energy and water from their use in customers’ homes.

A traditional corporate report might pick out one or two products as case studies and look at their impacts, but what about the rest? If a company produces EPDs based on lifecycle assessment for all its products, this can reveal its overall impact much better than any CR report.

An EPD takes into account the ingredients of a product, the methods of its production, and the full environmental impact of each stage of its lifecycle.

If we apply the supermarket approach to other sectors, we can see a different level of debate about who should be accountable for what. What about a private equity firm owning various companies? Rather than ticking some boxes and sending back a meaningless Stanford Research Institute-type questionnaire, private equity firms could report the overall impact of each of their companies based on the products these companies sell or make. This would be possible if those companies all produced EPDs for their products. The same thinking would apply to project finance.

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Full product transparency: The future of reporting

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Good corporate reporting is based on the principles of accountability and transparency. When reporting on sustainability, this transparency is greatest when focused at product level. After a decade of corporate responsibility (CR), FPT heralds a new era for reporting. With many – and often most – environmental impacts occurring outside a company’s boundaries, extending reporting from the narrow confines of a company’s own operations to the wider effects of the products it sells demonstrates superior accountability. This is the ultimate in transparency. It is also of greater relevance to most stakeholders, who are more interested in a company’s products than its facilities.

Accountability across the whole value chain

So forget reporting at company level. Classic CR reporting is too narrow in focus, and it misses too much. Environment sections of reports are usually limited to the immediate impacts of a company’s operations, perhaps with a nod to managing impacts in the supply chain. By extending reporting to include the impacts of products throughout their lifecycle, companies can demonstrate transparency and accountability across the value chain.

A supermarket should take accountability for the products that go through it, not just its buildings

Which environmental impacts, for instance, should a retailer be account- able for – and report on? The environmental impact of a supermarket extends well beyond the doors of its stores to include the impacts of all the products it sells. These occur before and after the products enter and leave the stores – in their production, their use and their disposal. Yet conventional corporate reporting would largely ignore anything that happens outside of the store, apart from a few cherry-picked case studies.

By taking accountability for the impacts of products across their lifecycle, retailers can gain a much better idea of their overall impact on society – and of the type of products they might want to sell. Arguably, it was this kind of approach that led the do-it-yourself retailer B&Q to stop selling patio heaters. A traditional CR approach would not have registered the significant environmental impacts of patio heaters in their use phase. Ikea is now assessing its products based on a sustainability product scorecard to assess the lifecycle impacts of its products, including waste, energy and water from their use in customers’ homes.

A traditional corporate report might pick out one or two products as case studies and look at their impacts, but what about the rest? If a company produces EPDs based on lifecycle assessment for all its products, this can reveal its overall impact much better than any CR report. An EPD takes into account the ingredients of a product, the methods of its production, and the full environmental impact of each stage of its lifecycle.

If we apply the supermarket approach to other sectors, we can see a different level of debate about who should be accountable for what. What about a private equity firm owning various companies? Rather than ticking some boxes and sending back a meaningless Stanford Research Institute-type questionnaire, private equity firms could report the overall impact of each of their companies based on the products these companies sell or make. This would be possible if those companies all produced EPDs for their products. The same thinking would apply to project finance.

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PEF Policy Conference – 29-30 April – Berlin

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Join us at the PEF Policy Conference where they will release details on the upcoming pilot phase on the development and testing of Product and Organisational Environmental Footprinting Category Rules, benchmarks and communication vehicles.

Rana Pant from the European Commission Joint Research Center will be available to assist Michele Galatola from DG Environment on the technical aspects of the pilot phase. An updated programme for the event will be posted tomorrow here.

The PEF Policy Conference will be held on 29-30 April 2013 in Berlin. Objectives include; developing an early understanding of open questions, next steps and perspectives from different stakeholders on the future use of the detailed product environmental footprinting methodology and respective policy options. All participants are invited to actively contribute to the open dialogue to sharpen the common understanding of the road ahead.

Please click on the image below to find out all about the PCF World Forum including the program of events for this coming week.

Product Environmental  Footprinting (PEF)

Registration is still available via online or Fax Form

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Helping companies and consumers navigate the green maze

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The European Commission has released a fantastic initiative around the subject of ‘Building the Single Market for Green Products’. Helping companies and consumers navigate the green maze.

What is the problem for companies?

A company wishing to market its product as green in several Member State markets faces a confusing range of methods and initiatives. Let alone the hundreds of certification sharks, private labels and incumbent national systems that make a huge amount of money from this.

What is the problem for ‘Mum’ in the supermarket?

Consumers are also confused by the stream of incomparable and diverse environmental information: according to a recent Eurobarometer, 48 % of European consumers are confused by the stream of environmental information they receive. This also affects their readiness to make green purchases.

In the words of Commissioner Potocnik

“To boost sustainable growth, we need to make sure that the most resource-efficient and environmentally-friendly products on the market are known and recognisable. By giving people reliable and comparable information about the environmental impacts and credentials of products and organisations, we enable them to choose. And by helping companies to align their methods we cut their costs and administrative burdens.”

The commission has issued strong guidance on product footprinting as well as organisation footprinting. I will be commenting on these documents in the future.

The EC is launching a three-year pilot phase. Their objectives:

* Set up and validate the process of the development of product group-specific rules (Product Environmental Footprint Category Rules – PEFCRs), including the development of performance benchmarks. Where product group-specific rules already exist and are used by stakeholders, the Commission will use these as a basis for the development of the PEFCRs;

* Make the application of the environmental footprint methods easier, especially for SMEs, by testing innovative ways of managing the process and through the development of tools;

* Test different compliance and verification systems, in order to set up and validate proportionate, effective and efficient compliance and verification systems;

* Test different business-to-business and business-to-consumer communication vehicles for PEF information in collaboration with stakeholders.

I hope businesses will jump at these pilots to achieve our dream of open standards and push for full product transparency in the market without delay.

 

Links

Original press release

Draft Communication from the Commission to the European Parliament and the Council: Building the Single Market for Green Products – Facilitating better information on the environmental performance of products and organisations (April 2013)

Draft Commission Recommendation on The use of common methods to measure and communicate the life cycle environmental performance of products and organisations (April 2013)

Annex II of the Recommendation: Product Environmental Footprint (PEF) Guide (April 2013)

Annex III of the Recommendation: Organisation Environmental Footprint (OEF) Guide (April 2013)

For more information contact: 

Joe Hennon (+32 2 295 35 93) and Monica Westeren (+32 2 299 18 30)

 

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The magic metric that changed the car industry

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What has happened to the car industry using g CO2/km as a metric is a very good example of the depth of transformation that product transparency can deliver. This fascinating metric has enabled European regulators to mandate top-down targets for car companies, enabled customers to have a comparable reference for the car footprint and provide national and local legislators the means to tax what is higher impact and support what is lower.

This transparent metric has also created competition in the car sector with the focus being upon their biggest environmental impact, ‘in life use’, which in turn has created a huge level of innovation in the car industry and supply chain. A decade ago the car industry had no incentive to design cars that would consume any less petrol. It really wasn’t at the core of car manufacturers’ strategy.

The industry used to design cars that were affordable to build but not necessarily always affordable to run. Yet according to European Union (EU) research, passenger cars make up 12% of total EU CO2 emissions. And yet, according to the European Environmental Agency, around 77% of the impact of a passenger car is in the ‘use’ phase with a further 13% directly linked to the production of the fuel consumed in the ‘use’ phase.

Environmental impacts during the lifecycle of a car

SOURCEShttp://www.eea.europa.eu/data-and-maps/figures/life-cycle-analysis-of-passenger-cars and http://ec.europa.eu/environment/ipp/pdf/jrc_report.pdf

For this transformational change to take place an overall regulatory framework at EU, national and local level was needed. Furthermore, and crucially, a common industry metric was required that could be used in the car industry. That magic metric was to be tail-pipe (exhaust) emissions measured as grams of CO2 per kilometre driven (g CO2/km). Although incomplete, because it didn’t take into account whole-life CO2 emissions and environmental impacts, this partial transparency at least focused on the biggest issue and has transformed the industry. g CO2/ km has given a purpose to policy-making, often bureaucratic, expensive, ineffective and siloed. Below is an overview of some of the key regulatory interventions this common standardised metric has enabled.

First, the bottom-up approach.

The EU Car Labelling directive was enacted to ensure that a label on fuel economy and CO2 emissions is attached to a car or displayed in a clearly visible manner near each new passenger car model at the point of sale. This bottom-up approach was based on driving transparent competition, which in turn enabled the customer to make an informed decision taking into account the biggest environmental impact of the product. Most customers might still choose a car mainly by the design or the brand but at least they have the right to know the impact of their decisions. What has been the main result of this transparency? It has cut off all the ‘greenwash’. No manufacturer today is doing green marketing on the little things they are doing in their factories or their recyclable seats. Why? Because this wonderful metric is allowing customers to say, ‘please cut the fluff and just tell me the g CO2/km for this car’.

Sustainability commoditized as it should be, like money: terrible news for marketing agencies, great news for the world. The beauty of such a metric goes beyond ‘point of sale’ to ‘all promotional materials’. Thanks to the same directive, today all car advertising must include the g CO2/km for that specific car being advertised. That has created consistency and transparency whilst simultaneously empowering the customer to not only become accustomed to the metric but make critical buying decisions based on this metric. My mother today knows that 160g CO2/km is too much and 100 g CO2/km is acceptable. Many Londoners know cars under 100 g CO2/km don’t pay the congestion charge. Consistent transparency creates customer literacy and awareness which leads to change.

Second, the old-school, top-down approach.

This key metric allowed an EU-wide regulation that came into law in 2009, requiring each manufacturer to decrease their average portfolio of emissions to 130 g CO2/km by 2015 and 95 g CO2/km by 2020. In 2008, the average g CO2/km for car emissions in the UK was 158.0 g CO2/km. In 2009 that figure was 149.5 g CO2/km so the change because of legislation is huge. Look at how effective those ugly technocrats from Brussels have been! How ironic that the UK Climate Change Committee highlights cars as one of the few successes of carbon reductions in the UK. This legislation came about because the EU ran out of patience with industry voluntary agreements.

Yes, those voluntary agreements so loved by politicians because they don’t have to impose any difficult decisions. In 1998, the European Automobile Manufacturers’ Association (ACEA), JAMA, and KAMA agreed to reduce average CO2 emissions from new cars sold to 140 g/km by 2008. That was a 25% reduction, quite considerable. But predictably when there is no stick or carrot on the table, the car manufacturers’ commitment achieved a mere 2.2% reduction between 1998 and 2006. What would you expect? So the EU set up a mandatory target and crucially gave a sensible period of time (2020) to allow companies to invest, innovate and so make the necessary widespread changes required to meet the targets of this regulatory framework.

It also came with sticks in the form of financial penalties.

Surprise, surprise, it’s working! CO2 emissions from new passenger cars have started decreasing substantially: 1.6% in 2007, 3.2% in 2008 and 5.4% in 2009. That’s the beauty of the market: tell it what you want to achieve and it will find a way to do it. The problem is that on many occasions we don’t tell the market, our supplier, what we want, or worse, we don’t have the metrics. These two combined policies, of setting agreed, clearly measurable targets and making this information clearly visible to the end customer are completely changing the playing field of competition within the car industry. And this competition through innovation will compel manufactures to meet the EU-wide target of 95 g CO2/km by 2020. Car manufacturers are doing what they are best at – designing cars – as opposed to inventing labels, patronising customers with green marketing, ‘engaging’ employees, sustainability reporting and other semi-useless stuff. But our beloved metric goes much further. It can transform national and local policy-making aimed at changing behaviours and purchasing decisions. One example at national level is the French Bonus/Malus scheme. Simply put, customers choosing to buy a heavy polluting car will pay extra tax on the price of the car, whereas customers choosing to buy a more fuel efficient car will receive a reduction in the price of the car. The tax penalty ranges from €200–2600 per car.

The incentive reductions range from €200 to €5000 and higher for even cleaner cars.

Around 31% of new vehicles will be eligible for the bonus, 25% for the malus. There are around 44% of new vehicles currently emitting between 130 and 160 g CO2/km that are not affected by the new measure. Furthermore, the bonus will be deducted from the price paid to the dealer and must be identified and visible on the bill. These facts will also provide incentives to dealers to sell cleaner cars. Another example is UK company cars.

In the UK you pay more tax for your company car if your car produces more CO2. For example, for a car of less than 75 g CO2/km the tax rate for petrol cars is 5%. For a car of 150 g it is 19% and for a car of 235 g it is 35%. This is a good example of variable tax on a clean or dirty product. The more you pollute the more tax you pay. But our magic metric is also very useful at the local level.

In London, cars which emit 100 g/km or less of CO2 and meet the Euro 5 standard for air quality qualify for zero congestion charge. A 100% exemption from congestion charge also applies to electric vehicles. In many towns in the UK such as York, Salford or Milton Keynes and Richmond, one can have discounted residents’ parking if you have a low carbon vehicle and free parking if you have an electric car.

Guess what? Customers are paying attention to the environment! Such a crazy bunch of tree-huggers…

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5. What is an epd?

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Full Product Transparency bookExcerpt 5 from the book ‘Full Product Transparency

‘What is an EPD?’

An environmental product declaration (EPD) is a statement of a product’s ‘ingredients’ and environmental impacts across its lifecycle. In the same way that nutritional labels help consumers compare the health benefits of food items, an EPD enables them to compare the environmental impacts of products.

Why an EPD is not just another eco-label

An EPD is not another eco-label. It is a statement of fact about the environmental impacts of a product. There are no ratings, claims or judgement calls to be made, as there are with eco-labels: an EPD itself doesn’t tell you whether a product is good or bad, green or polluting; it just provides the facts to enable better informed decisions.

In the same way that a chocolate bar with a nutritional label is not necessarily any healthier than a chocolate bar without one, having an EPD does not mean a product is ‘better’ or more sustainable. It does, however, enable customers to compare products and choose the ones that have least impact.

EPDs give you the full picture: for example, data on several environmental impact categories. Your product might be good on global warming potential (e.g. low CO2) but have a high acidification potential (e.g. high SO2) and both parameters have to be reported and not cherry-picked by the company.

How are EPDs created?
The methodology used to obtain an EPD is robust, and the assumptions used in the LCA calculations behind it are standardised. This means that manufacturers cannot manipulate assumptions to favour their own product (by calculating an artificially long life-span, for example). The methodology uses internationally recognised standards; an LCA must be conducted in accordance with ISO 14040 and the EPD must be produced in accordance with ISO 14025. All of this must be verified by an independent third party.

What does an EPD tell you?
A good EPD declaration would disclose the following:

• A list of raw materials and their origin
• A list of chemicals and their origin
• A description of raw material processing and production
• Specifications on the manufacturing of the product, including a breakdown of energy consumption and embodied energy, emissions released, treatment of waste, and packaging and transport
• Information on product use and end of life processing, including treatment of any waste and emissions released
• A table with the LCA results per impact category per lifecycle stage
• Evidence and verification for the calculations. All EPDs need to provide a report showing evidence for verification of the calculations and statements in the EPD

Once all these data about the environmental footprint of the product have been verified by an independent third party auditor, they then need to be captured in a clear and concise declaration.

How EPDs provide full product transparency and why that matters

FPT disclosure based on EPDs empowers and enables all customers, whether they are governments, businesses or consumers, to gain a clear understanding of the total environmental and social impact of a product, including at its end of life.
Providing customers with accurate, impartial third party-certified information about the total footprint of a product allows them to vote through their purchasing decision and to buy the right sustainable product. This will not only have a positive impact on the environment and society but also on competition and innovation. It creates a clearly visible level playing field for companies offering similar products within a sector, and it forces them to compete not only on price and quality but on all aspects that go into the making of a product.

EPDs are inexpensive, contrary to the urban myth

Some people argue that EPDs are very expensive and, especially if you have too many product categories, that it becomes unmanageable. This is like arguing that Unilever or Kraft would find it impossible and very expensive to provide the nutrition facts for all their products, given their product range. Yet they manage.

EPDs are expensive if you don’t do the internal work and you ask a consultant to do all the work for you. You would end up paying from €10,000 to €15,000, which is still much less that what many companies pay for some green labels. To put this into perspective, I have seen companies in the building products sector pay more than €50,000 for various types of green labels and certification schemes of dubious independence and robustness.

Once you invest internally and a small part of your corporate social responsibility (CSR) or sustainability team have the ability to perform LCAs, it becomes very inexpensive and EPDs can be done for less than €1000, sometimes even €500. And the information collected is not only of great use externally but for internal purposes and decision-making, mostly substituting for redundant internal reporting.

Example of information contained in a real EPD

Result of the LCA for Microtuft modular PA 6.6 carpet from InterfaceFlor

 

Next time ‘The Magic Metric That Changed The Car Industry’

… please revisit regularly for more excerpts from the book ‘Full Product Transparency‘ – or rent/buy by clicking here

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An Interview with Michele Galatola – ‘EU Environmental Footprinting’

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Michele Galatola from DG Environment at the European Commission provides an overview on the rationale of the EU environmental footprinting methodology.

In this short video he describes the addressed audience and possible fields of application of the methodology.

Furthermore Michele Galatola shares insights on the role of environmental footprinting in future EU policy.

From the PCF World Forum, Sep 2012 (Published Nov 2012) –

Renewable Resources in the Value Chain. A Viable Option for Reducing Environmental Footprints?”

About the PCF World Forum

Consumption of goods and services indirectly contributes to a large share of worldwide GHG emissions. Efforts are underway to better understand, manage and reduce these emissions. Standards and tools for carbon footprinting as well as more comprehensive environmental and sustainability metrics are developed, refined and practically tested.

The Product Carbon Footprint (PCF) World Forum is a neutral platform to share practical experiences and knowledge towards climate-conscious consumption and production. The international platform provides orientation in current standardisation processes and creates opportunities for discussing international corporate best practices and emerging tools to support low carbon and climate-conscious consumption models.

The PCF World Forum was created out of the ambition to talk with each other and not just about each other given the ever increasing number of initiatives around the world and often little real understanding of respective approaches and activities.

PCF World Forum is an initiative by Berlin based think-do-tank THEMA1.

www.pcf-world-forum.org

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3. What is Full Product Transparency and How Do You Go About It?

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Excerpt 3 from the book ‘Full Product Transparency

What are FPT, LCAs and EPDs? FPT IS HAVING, AND PROVIDING, a complete picture of the total environmental impact of a product throughout its life. The emphasis here is on environmental impact, because the methodology for calculating this, based on a lifecycle assessment, is much more established. It is also easier to gauge environmental impacts because most of these can be measured in a quantitative way. Give us a number of years and we will be starting to integrate better quantitative metrics for social issues, most probably sector by sector.

What do we mean by each word: Full, Product and Transparency?

Full means full disclosure, full range of products and full scope. That means that all the environmental impacts and ‘ingredients’ of a product should be disclosed. That includes materials, chemicals, installation or use methods, and of course, the combined impacts on the environment, which is the bottom line. Full product lifecycle scope is about taking accountability for all the lifecycle stages of a product made or marketed by an organisation.

The ‘product’ means focusing on products as opposed to direct company impacts. Instead of just being accountable for the direct impacts of an organisation, note that we are talking about the product and not the corporate entity. The idea is to get the mindset shifting so that organisations not only manage their impacts but manage the impacts of their products. But by ‘product’ we also mean product in the wider sense, so it could be a service rather than an actual, physical item.

The concept of FPT can be applied just as much to an internet search or a night in a hotel as much as to a t-shirt or a television. Transparency means disclosing product by product, all the ingredients and chemicals, describing the methods of production, disclosing the assumptions and following international standards and product category rules.

What is lifecycle analysis?

Lifecycle analysis (LCA, also known as lifecycle assessment) is a technique to assess environmental impacts associated with all the stages of a product’s life.

These are:

• Raw materials, extraction, processing and transport

• Manufacturing • Delivery and installation

• Customer use

• End of life (including impacts from disposal or recycling)

Lifecycle Analysis - Sustainability

LCA does not consider one single environmental impact such as carbon. It considers the most significant impacts on the environment for the system studied. These are commonly measured by quantifying the impact relative to the release in kg of the most significant molecular contributor to the impact.

Examples of categories of impacts used in LCA

2 Examples of categories of impacts used in LCA

SOURCE: Interface, Just the Facts Guide For more information see the European Joint Research Centre document. 

FIGURE 4. Example of categories of impacts in coal fired electricity generation SOURCE: Graph courtesy of Jane Anderson, PE International.

FIGURE 4. Example of categories of impacts in coal fired electricity generation

… please revisit regularly for more excerpts from the book ‘Full Product Transparency‘ – or rent/buy by clicking here

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2. It’s All About Products, Not companies

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Full Product Transparency bookExcerpt 2 from the book ‘Full Product Transparency

If you read corporate sustainability reports, you’ll find that most companies still focus primarily on the environmental performance of their own operations. Yet for many businesses this focus is mismatched with their true impacts, which lie outside their operations and fall instead within the lifecycle of their products.

When you view a company in terms of the products it makes – as opposed to its offices and employees – you soon discover that the vast majority of environmental impacts occur outside its operational boundaries. In many cases the impacts associated with raw materials extraction and processing, product use and end life far outstrip any ‘in-house’ impacts.

Most of the impacts are outside companies’ boundaries

For Interface’s carpet tiles, for example, around 68% of the impact is associated with the production of raw materials, while only around 10% can be attributed to in-house operations. For companies that make energy-guzzling machines, by far the biggest impact is during the product use phase. This is counterintuitive for many people, because the most visible parts of a company’s operations are either their glitzy office headquarters or their smoke-belching factories.

Sometimes the figures can be quite spectacular. For a consumer goods company such as Unilever, around 95% of a product’s impacts typically come from outside the company’s own operations (see figure below).

Unilver Product Impacts

Tesco, a UK supermarket, says its direct carbon footprint in the UK is 2.6 million tonnes of CO2 per year. Yet the impact of its supply chain, which makes the products that go into its shops, is 26 million tonnes of CO2 – ten times Tesco’s own footprint. And the footprint of its customers using Tesco’s products is even greater: 228 million tonnes of CO2, which is not far off 100 times the supermarket chain’s own footprint.

Apple Environmental Footprint

Only 2% of Apple’s carbon footprint comes directly from its offices and facilities, while around 61% comes from outsourced manufacturing and raw materials, and 30% from the product when it is being used by the consumer.

The impact of ‘stuff’ is usually in the supply chain

When a lifecycle assessment is carried out on a physical product such as a carpet, or a t-shirt, or some ready-mixed concrete, it usually shows that the biggest impacts are in the supply chain, and are therefore already embedded in the product before they get to the company for the final manufacturing process. The biggest environmental impacts up to this point are usually associated with the types of raw materials being used, as well as the types of chemicals used to process these raw materials.

Outsourcing has made things worse

With the advent of outsourcing over the past 20 years, we now have many brands that consist essentially of a marketing department, some finance people, HR and legal units, and a product design team. The actual manufacturing of the product happens halfway across the world in nations such as China, India, Turkey or Brazil, because it’s cheaper to manufacture in such places rather than in Europe or the US. This explains why so many lifecycle analyses of products show an increasing percentage of the impacts taking place outside the operations of a company.

The mismatch in management: 80% of management on direct impacts

So the bottom line is that the seemingly impressive corporate responsibility programmes and targets of many companies are in fact generally confined to minor issues, often down to the paltry level of office paper or electricity. These misinformed programmes take the attention and focus away from major issues such as raw materials use, in life product energy usage, toxic chemicals use and end of life disposal/reuse. These are the main impacts of a company that makes products, not their office lighting. The legendary green advocate Jim Fava, from Five Winds/PE International, made this crude point in a Green Mondays event in June 2011: he pointed out that 80% of sustainability management tools focus upon only 20% of the actual environmental impacts.

The key to sustainability lies in product design

The key to radical change, then, is through product design. If the impact is mainly in the raw materials, then by redesigning its products a company can use fewer raw materials, or use alternatives to them. If a product is a machine that consumes energy such as a car or a vacuum cleaner, then the key is in designing a product that is more energy efficient. And it’s not just physical design that can make a difference: the business model and commercialisation strategy can have a significant influence too.

People buy products, not companies!

One of the things we need to do is to get away from comparing companies so much. After all, people buy products, not companies. It is products and services that have an impact on our lives, so that’s what we should be measuring and trying to make more sustainable. Who cares whether Renault or BMW have more factories with ISO 14001, better corporate greenhouse gas reductions or have more environmental policies? We should be thinking about the impact of the cars they produce.

It’s worth stating again: people buy products, not companies. We need information to decide which product is better. Buyers need that information at point of sale, and in advertisements, so that we can make an informed choice. So why are companies so busy producing corporate reports instead of product information?

Leading companies are embracing LCA as a central design strategy

Unilever is measuring the impact of all its products and brands in all countries on a ‘per consumer use’ basis. So 70% of its products worldwide are now analysed from this detailed perspective, with the focus being on a single serving – a portion, or the typical use of a product such as tea, ice cream, shampoo or washing detergent by the end customer. The metrics it uses are greenhouse gas per consumer use, water, packing and waste per consumer use, as well as sustainably sourced materials. You can argue whether maintaining the impact while doubling sales is ambitious enough (Unilever’s sustainable living plan) but at least they are focusing on the right metrics and right scope: products.

Likewise, Boots, a pharmacy-led retailer, has developed a product sustainability assessment model that analyses 23 critical areas across the lifecycle of the product. These areas focus on the design, creation, transport, use and disposal or recycling of its products. Targets are set to drive innovation and improve the footprint per product and brand.

But still these strategies are far away from FPT

None of these examples are truly the FPT I’m about to advocate in later chapters but we can see some companies are getting closer and closer. For example, Unilever has a target to double sales and maintain its combined product carbon footprint. Yes, it’s just a factor 2 target which is not very ambitious, though they are starting to look at the right scope: full lifecycle products. Also, the Unilever target is combined product, and up to now they haven’t committed to publish Environmental Product Declarations (EPDs) by each product (or product categories). The FPT that I’m advocating requires you to disclose the true, full impacts of all your products.

… please revisit regularly for more excerpts from the book ‘Full Product Transparency‘ – or rent/buy by clicking here

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