Digital Product Passports in the Furniture Industry

From beds to chairs, tables to cabinets, the furniture industry is a true global necessity. Expected to grow at a rate of 2.78% annually, the furniture industry is projected to generate $729.73 billion by the end of 2025.

However, there are growing environmental concerns around furniture. Whilst furniture manufacturing carbon emissions have dropped from 2.5million tonnes to just under 1 million since 1990, the furniture industry is still considered a high-impact industry environmentally.

From sustainable manufacturing to raw material traceability, innovations such as Digital Product Passports in the furniture industry have the capacity to address the issues around sustainability and circularity across the sector.

Sustainability Legislation in Furniture

While furniture products don’t have their own specific piece of sustainability legislation, several new regulations have had a significant impact on the furniture industry.

The CSRD and the CSDDD

The Corporate Sustainability Reporting Directive (CSRD) is a sweeping initiative to revolutionise corporate sustainability reporting across the EU. The legislation requires companies to disclose detailed environmental, social, governance, and finance information related to sustainability.

Accompanying the CSRD is the Corporate Sustainability Due Diligence Directive (CSDDD),which requires companies to engage in and report on due diligence within their supply chains. This due diligence relates to a couple of main areas:

• Human rights regulation and the following of labour laws
•  Environmental risks that the company is exposed to

This disclosure and due diligence needs to be wide-ranging, not only including direct organisational emissions but also Scope3 emissions – indirect emissions from a business’ supply chain.

For furniture companies, this means increased scrutiny of the environmental impact of their entire supply chain, from production to logistics to end-of-life processes for furniture products.

The EUDR and the UKTR

Furniture products rely heavily on wood as a primary material – IKEA, a single furniture retailer, is responsible for 1% of global wood consumption annually.

The EU Deforestation Regulation (EUDR) is designed to reduce the reliance on products created via deforestation, with lofty goals to reduce the carbon emissions caused by the consumption and production of relevant products by 32 million metric tonnes per year.

The UK Timber and Timber Products Placing on the Market Regulations (UKTR) were updated in 2021 to replace EU timber sustainability legislation to ensure the UK timber industry retains sustainability as a focus in the wake of Brexit and remains in line with the EUDR.

Compliance with the EUDR will require furniture organisations to prove that their products aren’t linked to deforestation occurring after 31^st December 2020.

Ecodesign for Sustainable Products Regulation (ESPR)

The ESPR is a wide-reaching piece of legislation that helps to tackle the issue of unsustainable products on the EU market.

It enforces a strengthened framework for setting ecodesign requirements for several product groups to drastically improve the durability, repairability, and recyclability of physical products being placed on the EU market – including those that were manufactured outside of the region.

One of the core initiatives within the ESPR is that all organisations in industries that fall within the scope of the legislation must implement Digital Product Passports (DPPs) by 2030, with some mandated to introduce DPPs as early as 2027.

The furniture industry was even selected as one of the key industries for reform in the latest ESPR Working Plan as a high-priority industry. This means that furniture organisations will need to implement Digital Product Passports in the next few years to comply with the ESPR.

What are Digital Product Passports?

DPPs are a revolutionary new tool for sharing critical information about physical products with stakeholders throughout the supply chain. This data can span the entire product lifecycle – from manufacture to recycling and disposal – giving a holistic, comprehensive, and valuable overview.

The ESPR directly mandates that every product it regulates must come with a DPP, accessible by QR code or a similar data carrier. This will help provide stakeholders across the value chain access to verifiable information about product traceability, carbon footprint, and various other data related to supply chain sustainability.

This is especially important for furniture organisations that require heightened product traceability to improve their supply chain sustainability and efficiency, ensure product quality by tracking raw materials, and improve end-of-life processes for their products.

Benefits of Digital Product Passports in the Furniture Industry

Digital Product Passports are a tool for enabling widespread business transformation, with several direct benefits for furniture organisations.

Compliance with Upcoming Regulations

As we’ve previously discussed, multiple recent EU sustainability regulations will significantly affect operations in the furniture industry.

The ESPR mandates Digital Product Passports, so implementing them will obviously directly aid compliance with this regulation. However, the enriched product lifecycle data that DPPs provide will help enable furniture organisations to meet their compliance obligations elsewhere.

For example, the CSRD and the CSDDD require transparency and accuracy of data within an organisation’s supply chain. DPPs are required bylaw to meet a certain data integrity threshold.

Therefore, when companies are gathering product data for compliance with the ESPR via DPPs, that same data can be put towards compliance with these two stringent reporting regulations.

The Scope 3 data required by the CSRD – historically difficult for businesses to gather – will also be required to be included within DPPs. As furniture companies look at improving their data sources by auditing their supply chain, they’ll naturally capture a wealth of Scope 3 data to use in their CSRD reporting.

Working with a skilled DPP software provider will enable furniture organisations to utilise DPP data to generate verifiable audit trails to make reporting much easier, eliminate the duplication of reporting efforts for different regulations, and ultimately save on time and cost.

Improved Furniture Product Traceability & Sustainability

Product traceability is prized in the furniture industry. It helps to reduce supply chain complexity, remove inefficiencies and negative practices, and pass sustainability audits.

DPPs can help with furniture lifecycle tracking throughout the product’s entire lifecycle, from raw material sourcing to resale and recycling, helping to improve furniture supply chain transparency.

The required verifiable data within DPPs can help with raw material provenance – proving that raw materials such as wood are sourced sustainably. This is key for compliance with deforestation laws such as the EUDR and reducing the environmental impacts of raw material extraction for furniture production.

It also helps organisations comply with the EU Green Claims Directive, which imposes significant responsibilities on businesses to substantiate their environmental claims. DPPs provide proof of claims about sustainable manufacturing processes that customers can view, helping them to make purchase decisions based on social & environmental sustainability factors.

Additionally, the improved furniture product traceability afforded by DPPs helps track product performance after purchase. DPPs can offer repair and recycling instructions, enable manufacturer takeback schemes, inform on faulty product lines, and even open a new customer communication channel.

Conclusion

Digital Product Passports hold the key to building sustainable, circular supply chains, providing a powerful platform for storing supply chain sustainability data, from individual products’ carbon footprint in formation to the origins of their raw materials and beyond.

Overall, Digital Product Passports represent a revolutionary new tool for furniture organisations. DPPs can showcase verifiable, reliable data for furniture manufacturers to boost their overall operational sustainability, build audit trails, improve product traceability, and much more.

Whether your organisation has a simple or highly complex supply chain, it’s time to start investing in your DPP strategy and prepare for the implementation of Digital Product Passports in the furniture industry now.

Provenant offers furniture organisations specialised consulting services and a powerful platform for building Digital Product Passports into their business, enabling compliance with new sustainability regulations and meeting their sustainability goals.