CHRIS JONES | OCTOBER 01, 2024 | 5 MINUTE READ
In recent years, sustainability has moved from a niche interest to a central theme across industries, especially in fashion, where its implications are both broad and profound. However, while many brands have embarked on self-directed sustainability initiatives, true transformative change often seems just beyond our grasp. Many consumers, driven by cost considerations, continue to prioritise price over sustainability claims, which often remain unsubstantiated. This dynamic underscores a critical truth: significant sustainability advancements are frequently propelled by legislation, not market forces alone.
This brings us to a relatively under-the-radar yet critical legislation set to redefine product sustainability in the European Union—the Ecodesign for Sustainable Products Regulation (ESPR). Enacted by the EU Commission under the bounds of the EU Green Deal, ESPR is not just another regulatory hurdle; it is a cornerstone of the EU's strategy to facilitate a Circular Economy to enhance product sustainability and consumer transparency but with the ultimate objective of increasing value across the EU markets.
ESPR is a cornerstone of the EU's strategy to facilitate a Circular Economy to enhance product sustainability and consumer transparency but with the ultimate objective of increasing value across the EU markets.
ESPR: A Strategy to Reset the Sustainability Dial
The ESPR is a broad and ambitious legislative framework aiming to reduce environmental impacts by setting sustainability requirements for physical goods sold in the EU. Crucially, it was adopted into EU Law in July 2024 – it’s coming whether we like it or not. Its far-reaching implications require brands to rethink how products are designed, manufactured, and recycled. However, the true game-changer within ESPR is the Digital Product Passport (DPP)—a compliance tool that could redefine market norms within the EU and globally.
ESPR was adopted into EU Law in July 2024 – it’s coming whether we like it or not
Digital Product Passports: Redefining Product Sustainability
At its core, a Digital Product Passport (DPP) is a digital twin of a physical product that carries essential information about the product’s lifecycle, including its raw materials, manufacturing, usage, and recyclability data. Set to be implemented progressively across various sectors from 2026 to 2030, with initial applications in textiles, batteries, and consumer electronics, DPPs are expected to provide unprecedented transparency into the products’ sustainability credentials.
The ESPR stipulates timelines for every product sector. For the fashion industry, mid-2027 is the deadline for DPPs to be enforced for any textile product marketed in the EU, highlighting the immediacy and inevitability of this shift. The inclusion of over 100 mandatory data points in a DPP ensures that every significant aspect of a product's environmental footprint is documented, from resource origin to end-of-life disposal.
Transparency via the Digital Product Passport will display evidence of verifiable compliance.
Of course, the EU will monitor DPPs, and the brand or retailer, as Responsible Economic Operator (REO), is responsible for the accuracy of the data. Non-compliance could result in fines and market restrictions.
DPP Timeline for the Textiles Sector
- March 2024: The definition of the Textiles Delegated Act (DA) began, which will define requirements for DPP compliance.
- July 2024: Ecodesign for Product Sustainability Regulation (ESPR) was adopted into EU law.
- Mid-2025: The draft Delegated Act is shared with EU Standardisation Committees (CEN & CENELEC).
- End-2025: DPP Standards are due to be published.
- January 2026: Textiles Delegated Act is due to be published.
- Mid-2027: DPPs for Textile products are due to be enforced.
Mid-2027: DPPs for Textile products are due to be enforced.
Sustainability through competition
Part of the EU Commission's strategy within the circular economy is to leverage commercial and competitive forces via the additional evidence from the DPP to improve sustainability gradually. What’s the driver? Products' proven sustainability will be accessible to consumers and increasingly generate competitive advantage, compelling brands to respond in kind to compete. This competitive pressure will trickle through, adding sustainability improvements across the value chain.
Evidence of compliance could leverage market forces to drive competitive advantage with proven sustainability
Competition and Opportunities Beyond Borders Creates the Strategic Imperative
While the technology to support DPPs exists, and solutions such as DPP as a Service (DPPaaS) are emerging to simplify compliance, the primary challenge for brands, particularly small and medium enterprises (SMEs), lies in acquiring and validating a new depth of primary data. The rigour involved in capturing and maintaining the accuracy and consistency of this data is non-trivial and represents a significant operational shift.
capturing and maintaining the accuracy and consistency of raw materials' and primary process data is non-trivial and represents a significant operational shift
However, the situation presents a unique set of challenges and opportunities for UK brands. Any international brand selling into the EU must comply with ESPR requirements, including publishing a DPP before a product can pass through customs. This regulatory requirement will serve as a catalyst for the broader adoption of DPP practices across all products offered by a brand, not just those sold in the EU. Such a move aligns with global sustainability trends and offers a competitive edge in increasingly eco-conscious markets.
The presence of DPP-compliant products from EU brands in the UK market will redefine consumer expectations, setting a new benchmark for product sustainability. This scenario introduces a competitive disadvantage for local brands that do not adopt similar practices. Moreover, as sustainability becomes a more prominent driver of consumer preference, UK brands without DPPs may find their market share eroding in favour of more transparent and environmentally responsible alternatives.
For UK brands, this sets a new benchmark in product sustainability, creating a strategic imperative to adopt similar practices to safeguard their market share and reputation.
DPPs will be present in non-EU markets and will influence the buying behaviours of consumers.
Leveraging DPPs for Circular Economy Engagement
DPPs facilitate a shift towards a Circular Economy, breaking the traditional "Take-Make-Dispose" model by enabling brands to engage in multiple transactions over a single product's lifecycle—way past the initial sale, which is still the ‘end point’ for many brands. This model reduces waste and resource consumption and opens up new revenue streams through resale, reuse, repair, recycling, and upcycling efforts.
The objective of the circular economy is to increase the value of EU markets and set minimum compliance while leveraging market forces to continuously improve sustainability.
Beyond Compliance: The Strategic Advantage of Digital IDs
Digital Product Passports open up several strategic avenues beyond mere compliance. Each DPP is anchored by a unique Digital ID, facilitating not just traceability but also enabling new business models.
Moreover, the visibility provided by DPPs can help brands manage supply chains more effectively, reduce risks related to non-compliance with sustainability standards, and foster a closer connection with customers through greater product transparency.
Additionally, as AI use cases flourish, the value of this large volume of accurate primary data to populate large language models (LLMs) and drive greater efficiencies from leveraging AI cannot be overstated.
Digital IDs embedded within each DPP serve multiple functions that extend far beyond regulatory compliance.
- Inventory Management: Digital IDs can significantly enhance the accuracy and efficiency of inventory management, increasing assortment accuracy and full-price sell-through, reducing labour costs, strengthening loss prevention, and transforming omnichannel experiences.
- Product Authentication: Widely applicable product authentication enhances consumer trust and reduces counterfeit risks.
- Consumer Engagement: Digital IDs foster richer, more personalised consumer interactions, strengthening loyalty and enhancing customer experience.
- Value Chain Insights and Efficiencies: Large volumes of accurate primary data from across the value chain will provide the data ‘fuel’ to populate LLMs, enabling the generation of insights to streamline agile supply chains and driving efficiency as AI use cases remove low-value tasks from the creative processes.
DPP’s Digital ID is a gateway to new opportunities
Conclusion: A Paradigm Shift Led by Digital Transformation
For UK fashion brands, the decision to adopt Digital Product Passports should be viewed not as a regulatory hurdle but as a strategic enabler. Adopting Digital Product Passports offers UK fashion brands compliance with emerging global standards and a strategic pathway to innovation and leadership in a sustainability-focused market. By embracing the capabilities of DPPs and Digital IDs, UK brands can drive growth, foster consumer trust, and establish themselves as frontrunners in the global shift towards more sustainable business practices.
As legislation ushers in an era of heightened environmental consciousness, UK fashion brands face a clear call to action: leverage the potential of Digital Product Passports to secure a competitive edge, embrace new business opportunities, and align with the global movement towards sustainability. The strategic integration of DPPs into business models is not merely beneficial—it is imperative for those looking to lead in the sustainable transformation of the fashion industry.
JBSO Group can help
If your business requires assistance with the challenges of implementing DPP, such as acquiring and centralizing primary data from the value chain, defining data flow and process flow, and integrating your business systems, don't hesitate to contact us to discuss how JBSO Group can help you address these challenges.
Please feel free to ask questions and share your thoughts and comments below.
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Author Chris Jones
For over three decades, Chris has helped global brands, retailers, and manufacturers align people, processes, and technology, driving transformation projects to maximise business impact.
This article is also published on the JBSO Group website:
Strategic Imperative: The Role of Digital Product Passports for UK Fashion Brands (www.linkedin.com)