Digital Product Passports Will Help Create Sustainable Supply Chains And Boost Circular Economy Potential, Research Shows

Introducing Digital Product Passports (DPPs) will enable manufacturers to better trace the origins and history of the materials used in their products, giving businesses a reliable means of determining what can be reused or recycled at the end of a product’s life, new research from Durham University Business School reveals.

Such data can allow businesses to clean up their supply chains, decrease waste and even reduce costs.

The study, conducted by Professor Atanu Chaudhuri, alongside Professor Brian Vejrun Wæhrens and Steffen Foldager Jensen of Aalborg University in Denmark and Professor Horst Treiblmair of Modul University in Austria explores how DPPs can facilitate industry transitions into sustainability, by setting out the core benefits of their use and highlighting the barriers to their introduction.

Manufacturers in particular face significant pressure to adapt their practices to become more sustainable, with electronic equipment production prioritised as one industry, along with electric vehicles, textiles and construction, in which DPP adoption would be most beneficial.

“Electronics equipment manufacturers will develop a large variety of products, each with different sizes, weights and material content. Such products contain precious metals like copper, gold and silver - all critical and rare natural elements used for integrated circuits, magnets in small motors, hard drives, capacitors and plastics for multiple parts,” says Professor Chaudhuri.

“Such companies recognise that manufacturing the parts has a significant environmental impact in terms of resource consumption, greenhouse gas emissions and electronic waste. Not only that, but the raw materials used are ever more scarce, driving up costs.”

DPPs, Professor Chaudhuri explains, are defined as digital records of a product’s lifecycle – tracking from its source to its end of life. DPPs provide those who access a product with its historical data such as prior usage, maintenance and repairs, and environmental impacts such as its emissions any energy needs.

Traceability can extend further, encompassing information on a product supplier’s certifications and social due diligence.

By making such information standardised requirements for product development and distribution, and making it available to interested parties the researchers state that DPPs can provide significant environmental, legal and financial benefits.

“DPPs can smooth the transition to circularity by proving an item’s value retention and suitability for reuse, remanufacturing and recycling, cutting down waste and saving costs on sourcing new raw materials, as well as helping companies with their regulatory compliance,” Professor Chaudhuri explains.

To explore the feasibility of DPPs becoming common practice, the researchers conducted interviews with three Original Equipment Manufacturers, engaging staff working across functions such as product engineering, compliance, quality, remanufacturing, materials and supplier collaboration.

Interviews were also conducted with suppliers, customers and recycling partners as well as with DPP service providers and with an international standards organisation.

The interviews focused on understanding the drivers for the OEMs and their supply chain partners to consider adopting DPP, the barriers they faced in doing so, and the potential performance outcomes they expected.

The results identified for key motivations for DPP adoption;
- Improve decision-making to transition towards a circular economy,
- Ensuring greater regulatory compliance,
- Improving transparency across supply chains,
- Enhancing customer engagement

The interviews also revealed four common barriers to DPP implementation;
- Developing and communicating the business case for DPP adoption across industry,
- The increased need for better data, data standards and ensuring effective information exchange and analysis between IT systems,
- The extent of effort needed for implementation,
- Ensuring data security and integrity

Being one of the earliest papers to concisely summarise the main drivers and barriers of DPP adoption, the study presents a compelling case for progress and sets the stage for researchers and other stakeholders to further develop operations and supply chain management.

To continue delaying making such a change will only bring damage to environment and to industry. “Europe produces the most e-waste per capita worldwide with around 11 kg per person/year,” shares Professor Chaudhuri, “but less than 50% of such waste is recycled in the EU, resulting in lost value in raw materials of €13 billion per year, according to PwC.”

As a result, finding a reliable means to safely reclaim, reuse and recycle unwanted materials rather than consigning them to waste not only stands to benefit the planet, but could protect companies from financial hardship in the long term.

Professor Chaudhuri will be sharing his findings as part of the curriculum for a brand new Executive MSc in Supply Chain Management, commencing next year. The programme, led by Professor Chaudhuri will be ran in partnership between Durham University Business School and Mannheim Business School in Germany.

Accredited by the Chartered Institute of Procurement and Supply (CIPS) and the Chartered Institute of Logistics and Transport (CILT), the programme is designed to equip students with the knowledge and skills to tackle modern and future global supply chain challenges, such as sustainability, and has been designed with input from industrial partners and organisations alongside academic leaders.

The study, “Impact pathways: digital product passport for embedding circularity in electronics supply chains” has been published by Emerald Insight in the International Journal of Operations & Product Management.

ENDS

For further information, please contact Kerry Ruffle at BlueSky Education - kerry@bluesky-pr.com / +44(0)1582790701