The manufacturing sector continues to be one of the largest and most dynamic industries on the planet. The industry is expected to be valued at 14.85 Trillion USD by the end of 2025, growing to over 20 Trillion USD by 2032.
However, manufacturing also remains one of the starkest sustainability challenges of our time. Industrialisation throughout the 20th Century saw organisations invest in production facilities, factories, and raw material extraction to create products for an ever-growing consumer base.
Environmental concerns and changing customer attitudes towards sustainability have increased scrutiny towards organisations for the production methods that feed their supply chain, leading them to focus on shifting production towards more sustainable manufacturing models.
This realignment is seeing organisations invest in new sustainable manufacturing solutions and update their toolbox with innovations such as Digital Product Passports.
What is Sustainable Manufacturing?
Manufacturing is a broad term for taking raw materials and turning them into finished goods on an industrial scale. Sustainable manufacturing is concerned with ensuring that the process by which this happens is less damaging to the environment, complies with labour laws, and uses resources most efficiently.
Considering that in 2022, the manufacturing sector accounted for 25% of global GHG emissions alone, it’s no wonder that sustainable manufacturing has risen in popularity amidst growing pressure from environmentalists, governments, and other stakeholders to reform the sector’s sustainability record.
Sustainable manufacturing rests on several principles:
- Energy and Resources – reduce the amount of energy, fuel, and water that it takes to create each product, and invest in renewable energy sources
- Efficiency – improve the efficiency of manufacturing processes across the board, reduce waste, and build an efficient, sustainable supply chain
- Recycling and Remanufacturing – provide enhanced recycling capabilities for each product via ecodesign, and utilise recycled materials where possible in the manufacture of new products
- Environmental Awareness – understand the current environmental footprint your operations have, and move to reduce the production or use of less ‘green’ materials such as plastics
It could seem daunting for organisations to implement sustainable manufacturing principles, some seeing it as a potential ‘box-ticking’ exercise. However, sustainable manufacturing has a plethora of business benefits for organisations.
For example, the focus on efficiency and lean processes can mean significant cost savings. Equally, improving organisational sustainability, especially in an industry under such scrutiny for its environmental footprint, could attract a swathe of eco-conscious customers and investors, leading to an increased market share.
And last, but not least, this is a manufacturer’s opportunity to be on the right side of history – to positively impact the environment, and do their part to reduce or reverse the negative impact that the previous ‘take-make-destroy’ model of production has wrought on the planet.
Sustainable Manufacturing in EU Legislation
The EU has proposed a raft of new sustainability legislation in recent years, many of which have direct implications regarding sustainable manufacturing.
The EU Clean Industrial Deal, for example, is a bold strategy aimed at transforming the manufacturing sector and making it more sustainable whilst maintaining competitiveness within the global marketplace.
Corporate reporting legislation such as the CSRD and CSDDD have deep implications for manufacturers also. They set reporting requirements for organisations of a certain size that go beyond financial elements to include environmental impacts and social impacts, such as the adherence to humane labour laws in factories.
But the key piece of sustainability legislation for manufacturers to look out for is the Ecodesign for Sustainable Products Regulation (ESPR). Coming into effect on 18th July 2024, the ESPR is a wide-ranging piece of legislation that establishes sustainable design requirements for physical products entering the EU market.
It applies to physical products manufactured and sold on the EU market, including those manufactured outside the EU. The ESPR highlights an initial group of end-user products to be regulated, including Textiles and Furniture, as well as intermediate products such as Steel and Aluminium.
The ESPR Working Plan, released in 2025, further clarifies the order of prioritisation for regulated industries, placing Mattresses and Tyres at the top of the list, with the intermediate products Steel, Iron, and Aluminium additionally prioritised.
A core piece of data infrastructure enabling the legislation is Digital Product Passports, which will be relied on for sharing product data amongst stakeholders. These will be mandatory for all regulated products under the ESPR, with a rollout timeline between now and 2030.
What are Digital Product Passports?
Digital Product Passports (DPPs) are a mechanism for sharing critical product data throughout the product’s lifecycle.
Via a data carrier, such as a QR code, RFID tag, or NFC technology, DPPs can be attached to physical products to give a holistic view of their lifecycle from manufacture to sale, through their eventual recycling, resale and beyond.
DPPs can carry various types of data, including:
- Raw Material Composition
- Manufacturing Information
- Supply Chain Journey
- Sustainability/Carbon Footprint
- Recyclability
- Ownership
- Warranties
This data is to be structured to meet the needs of regulators and for businesses to use practically to increase the overall sustainability of their operations. Designed for interoperability, DPPs will be required to integrate into existing databases and digital systems.
Giving stakeholders reliable access to this data can drive sustainable consumer decision-making, maximise product recyclability, and encourage circular economy principles, making DPPs one of the core drivers of the ESPR.
Manufacturers will have a key role in implementing DPPs across the wider business ecosystem. As the point of production, they’ll likely be responsible for generating the initial DPP for the products they manufacture.
DPPs and Sustainable Manufacturing
Digital Product Passports have several potential applications to help organisations with their sustainable manufacturing goals.
1. Raw Material Sustainability and Improved Labour Practices
To manufacture any physical product, you need the raw materials to do so. Historically, the extraction of raw materials has been a touchy subject in sustainability circles, with organisations relying on outsourcing to suppliers with questionable business practices that breach environmental and labour laws.
For example, manufacturing the smartphones and laptops that are so prevalent in the developed world requires rare earth materials such as coltan. 40% of the global coltan supply is produced in the Democratic Republic of the Congo, the mining of which often relies on the shameful practice of using child labour in the mines to maximise profit.
The product lifecycle data available within DPPs (which by law must be transparent, accurate, and verifiable) will increase the traceability and provenance of the raw materials within the product, including granular data on the origin and extraction methods for each of these materials.
This will help consumers make ethical decisions when purchasing goods that contain coltan and other rare earth minerals, as well as helping those electronics and battery manufacturers that are truly following sustainable manufacturing processes, especially concerning raw material extraction, to prove their product sustainability claims.
From a compliance perspective, having DPPs that contain verifiable data demonstrating that your product’s raw materials are ethically sourced will help manufacturing organisations to comply with new reporting and disclosure legislation such as the CSDDD.
2. Enriching Smart Manufacturing Systems
Creating DPPs often means mapping hundreds and even thousands of data points throughout a product’s lifecycle.
This glut of data, necessary within the context of DPPs themselves, can also be fed into smart and sustainable manufacturing solutions. Predictive analytics systems, for example, utilise data to optimise stock levels and forecast demand in manufacturing
The data contained within DPPs can help enrich these digital systems, which often utilise Machine Learning (ML), to build a wider and more detailed picture of a product’s supply chain journey and more deeply connect disparate suppliers and retailers.
This rich insight enables organisations to more accurately pre-empt supply bottlenecks, improve efficiency, reduce waste, and cut the operational costs associated with poor inventory management.
For instance, if a specific product line is experiencing an unusually high rate of returns, this data can be relayed in real time via the DPP from the retailer to the manufacturer. The manufacturer can then examine the design and manufacturing process, potentially identifying the issue and rectifying it more promptly.
3. Improved Recyclability and Remanufacturing
A significant portion of EU sustainability legislation, such as the ESPR, is dedicated to improving recyclability rates for products, as well as promoting remanufacture and reuse.
Digital Product Passports are required to contain various data points related to the product’s material composition and instructions for repair, reuse, and recycling, accessible to all stakeholders.
This means that customers will be able to access recycling information, allowing them to recycle the product and packaging correctly.
For more complex products, DPPs can also contain information for end-users on where to deliver the product for recycling. Specialist recycling companies can gather detailed product information to help them recycle these more complex products more efficiently.
Additionally, for manufacturers with recycling and remanufacturing capabilities, DPPs can give instructions on how to send their products back to the manufacturer directly, giving a direct communication channel for the manufacturer to reward customers for doing so, enabling efficient takeback schemes.
Conclusion
In order to tackle the damage that the traditional manufacturing sector has had on the environment, the EU has included several provisions in its sustainability legislation that aim to promote sustainable manufacturing.
The ESPR, establishing sustainable design requirements for physical products entering the EU market, targets many manufacturing-related industries with strict regulations that will help bring the overall manufacturing sector in line with global sustainability targets.
It mandates the use of Digital Product Passports for all regulated products. Manufacturers, on the front line of DPP implementation, can utilise the technology to improve raw material sustainability, help prove their green claims, enrich smart systems, and improve product recyclability.
Ready to join the sustainable manufacturing revolution? It’s time to invest in preparing your business for Digital Product Passports.