On January 11, 2024, the European Parliament’s Environment Committee adopted the Eco-design for Sustainable Products Regulation (ESPR), which had been approved by the member states. This was the epilogue to an obstacle course for this major piece of legislation, to be ratified by Parliament this spring. Europe, which is said to be incapable of deciding, has shown here its determination to act.

What does this legislation mean for global businesses?

For the future of the planet, the implications are tremendous. While there was no unified method at European level in terms of environmental labeling and eco-design, there will now be a single method applied everywhere. The more or less rigorous approaches, each developed individually by the Member States, to assess the environmental footprint of products are over. Everyone will have to apply the same scientifically rigorous method, based on the calculation of the global footprint, that is defined by the PEF – Product Environmental Footprint method. This method, which in itself constitutes a real disruption, takes into account the 16 categories of impact of human activity on the planet and not only the carbon footprint, in particular the emissions of fine particles, the depletion of fossil resources and minerals, deforestation, eco-toxicity and even biodiversity issues. In fact, all the components of the environmental crisis which is not only climatic, but systemic.

It is the fruit of ten years of exemplary work, at the initiative of the European Commission, to reach a consensus of the scientific community, in consultation with NGOs.

This decision requires companies producing or marketing products within the European Union – therefore, in fact, a large part of American companies – must, in a restrictive manner, under penalty of being prohibited from entering and selling products within the EU, respect the stringent requirements. Priority sectors have been decided: Apparel and footwear, furniture, tires, cleaning products and even paints. Ultimately, all sectors will be concerned, and all products will benefit from a digital passport. Concretely, a dematerialized product sheet with a set of data (origin, composition, manufacturing process but also environmental footprint) will impose environmental transparency.

This decision by Europe, imposes itself on all the major exporting economic powers, first and foremost the United States, as a great moment. It marks a victory for the European Commission which was able to convince the Member States. It also vindicates all those including me, who tirelessly, despite the pressure from lobbies in favor of everyone for themselves, pleaded for the affirmation at European level of a harmonized and scientifically based method. It is also the affirmation of European environmental sovereignty which will disrupt the industrial practices of all major global players and therefore those in the United States, who will now have to eco-design their products according to EU criteria.

Looking Ahead – an Opportunity for American Brands

The United States can help lead this European dynamic on a global scale. While as part of the European Green Deal adopted in 2020, the EU approved policy initiatives aimed at making the EU climate neutral by 2050, the United States itself has made great progress towards this. common goal: from rejoining the Paris Agreement in 2021 to enacting the Inflation Reduction Act of 2022, which includes the largest national investment in climate change in state history -United. The government could thus appropriate the European PEF method for defining and scientifically measuring the environmental footprint of products and organizations, and adopt it as a reference to direct, in a more selective and objective manner, the colossal investments of the IRA towards the most virtuous companies in terms of sustainable development.

For their part, American companies could also adopt this European methodological framework, not simply for their activities in Europe, but at the global level, to not only better understand their real impacts and identify the right industrial levers to reduce them, but also thereby even, distinguish themselves from their competitors on their environmental performance, this time, rigorously measured.

In other words, where Europeans bring to the world invaluable scientific knowledge, i.e. the PEF method, as a universal compass to accomplish the ecological transition of humanity, American companies could deploy it with the power and agility that the world gives them. recognizes, on a large scale at the global level, to assert a new leadership, in addition to the economic one, that of environmental excellence.

About the author

Christophe Girardier is an expert in environmental issues and a seasoned entrepreneur in consulting strategy across retail, industry and services. He serves as CEO and co-founder of Glimpact, the first digital platform to fully evaluate the environmental impact of organizations and products based on the OEF/PEF standards adopted by the European Union. As part of the green deal.