The power of LCA: How can you drive competitive advantage through product footprinting?
The market has changed–sustainability is no longer a nice-to-have, it's an essential part of running a business in 2024 and beyond.
Overview:
Environmental standards and their benefits
The rising eco-conscious consumer
How LCAs help improve your business
Take the complexity out of your next LCA
As regulations tighten, and customers’ demand for eco-friendly products increases, companies have to prioritize sustainability to stay competitive–and frankly stay in business. But how can a small and medium-sized enterprise (SME) do so? Taking ownership of your product’s environmental footprint unlocks a world of opportunities; compliance, cost reduction, and future-proofing are just the beginning.
Let’s explore the growing market demands for sustainability, the challenges and benefits of environmental responsibility, and the crucial role of Life Cycle Assessments (LCA) in measuring and managing environmental impacts.
Environmental standards and their benefits
Regulation is growing everywhere. The EU is implementing a stringent set of regulations and measures to fight climate change in the European Green New Deal and beyond. Sustainability reporting and compliance obligations for companies are becoming increasingly strict, and your organization must stay ahead of them.
Across North America, similar efforts have been taken with the ‘climate bill’ (the Inflation Reduction Act of 2022) and California’s 54 billion dollar environmental regulations. Similar efforts can be seen in China, India, and beyond, with more to be introduced soon.
When implementing environmental measures SMEs face a few challenges. One survey found the biggest challenges include a lack of financial resources, knowledge and skills, as well as the struggles to prioritize these efforts, engage employees, and pains with the general administrative processes.
Of course, it’s not all doom and gloom, adherence to environmental standards has a wide range of advantages for businesses, on top of the essential benefits for our planet:
- Profitability: Compliance results in operational efficiencies, cost savings, and initiatives such as renewable energies and tax breaks.
- Market differentiation: An enhanced brand image lets your business stand out from the crowd.
- Risk management: Avoid compliance issues and limit financial or public relations danger due to ‘greenwashing’.
- Emergency planning: Prepare for worst-case environmental scenarios and keep your business future-proof.
The rising eco-conscious consumer
Environment, Social, and Governance (ESG) issues are a significant priority for all businesses, but especially customer-facing ones. It’s not just about government regulations–though this is an essential part of compliance–it’s because more and more customers are avoiding companies who score poorly on ethical supply chain metrics.
Don’t just take our word for it, Deloitte’s 2023 sustainable consumer review found 11% of consumers make a purchase decision based on carbon footprint data availability, and 16% believe this data is a core part of what makes a product or service sustainable. On top of this, 32% of consumers claimed their trust in brands would be improved if they had a “transparent, accountable, and socially and environmentally responsible supply chain”.
Even if you sell to larger organizations or government entities, you may face similar responses. For example, in the EU, the Corporate Sustainability Reporting Directive (CSRD) is a requirement for SMEs to report on the social and environmental performance of the activities across their value chain. In the UK, companies who plan to bid for major government contracts are expected to have a net zero commitment.
We know consumers care, but can businesses like yours really make a difference? Many of us assume that bigger companies are the ones who are responsible for the majority of climate-changing emissions, but the reality is that even SMEs have a large part to play in climate action. In fact, 45% of global greenhouse gas (GHG) emissions can only be tackled by the production (and consumption) of everyday items.
We focus a lot on waste and recycling in the environmental sphere, but the design of products plays a bigger part than we realize. According to the Ellen Macarthur Foundation, a circular economy charity, decisions made at the design stage influence 80% of a product’s environmental impact. But how can you make use of this information to improve your product’s impact?
Can simple product iterations have a big impact? See how food and beverage brand Willicroft took radical measures to reduce the impact of their products and create a climate-friendly, dairy-free cheese experience with wide-ranging benefits.
How LCAs help improve your business
Life cycle assessment (LCA) is a science-based method used to evaluate the environmental impact of a product or process throughout its entire–you guessed it–life cycle. LCAs take into account all stages of a product’s life, from raw material extraction to its disposal or recycling–from the cradle-to-the-grave.
This process provides you with quantitative data on your product’s environmental performance, which can help you make data-driven decisions about product design, material selection, and manufacturing processes, helping you (re)design more sustainable–and competitive–products. This applies to both strategic decisions around new products and iterative decisions for continuous business improvements.
These assessments help your business identify environmental hotspots, which are the stages in a life cycle that have the greatest environmental impacts. Understanding these hotspots helps you understand the areas to focus your attention on for significant improvements–both to the environment and your company’s wallet.
Speaking of money-saving, LCAs can help you identify cost saving opportunities. These include optimizing resource use, minimizing waste, and reducing energy consumption. These can help your businesses not only lower operating costs but also reduce costly redesigns or product recalls by addressing issues early on in the development process.
LCAs help you assess the entire impact of a product, not just its carbon footprint. While this is a crucial metric, focusing on it solely can lead to an incomplete understanding of a product’s environmental impacts. Lifecycle assessments provide a more comprehensive approach by considering multiple environmental factors across the entire product life cycle. Starting with your carbon footprint is important, but LCAs help you avoid limiting your scope to carbon-only decisions, helping you gain a more competitive understanding of your products.
Most importantly, life cycle assessments can drive product innovation through the redesign or development of new, more sustainable products and processes, thus creating products with lower environmental impacts.
So how does your business start making full use of life cycle assessments?
Take the complexity out of your next LCA
Life cycle assessment can be complex and time-consuming, especially for SMEs with limited resources. Traditional LCA methods often require extensive expertise, considerable time investment, and significant financial commitments, making it challenging for businesses like yours to take ownership of your product footprinting process.
Thankfully, with new life cycle assessment software, you can now streamline their assessment process and gain valuable insights into your products’ environmental impact without the need for extensive resources.
The right software can help you overcome the challenges associated with manual LCAs, helping you to make data-driven decisions and implement changes quickly. Taking ownership of your product footprinting process is now more accessible than ever.
Take ownership of your product impact
In today’s market, sustainability is a key driver of competitive advantage. By leveraging Life Cycle Assessments (LCAs), businesses can meet stringent environmental standards, attract eco-conscious consumers, and uncover significant opportunities for cost savings and innovation. Embracing LCAs empowers your business to design more sustainable products and streamline operations, giving you a distinct edge over competitors. Ready to harness the full potential of product footprinting? Download our free e-book to learn how to take ownership of your product footprint in just 5 steps.
