Product Environmental Footprint Methodology — TrusTrace – Leading fashion supply chain traceability software

Last updated on December 16, 2024.
Everything You Need to Know About PEF: Compliance, Requirements, and How to Stay Compliant.

Overview

The European Union (EU) is taking a decisive step toward sustainability by introducing the Product Environmental Footprint (PEF) framework. Designed to standardize the assessment of a product’s environmental impact, PEF has become a critical topic for businesses aiming to stay competitive and compliant in the evolving regulatory landscape.
In this article, we’ll cover what PEF is, who needs to use it, the data requirements for PEF compliance, its timeline, and the potential consequences of non-compliance.  We'll also explore how companies can stay compliant and how solutions like TrusTrace can streamline the process.

What is the Product Environmental Footprint (PEF)?

The Product Environmental Footprint (PEF) is a Life Cycle Assessment (LCA)-based methodology developed by the European Commission to standardize the evaluation of the environmental impacts of goods and services. Unlike traditional LCAs, PEF ensures a consistent and comparable approach across industries by providing clear guidelines for every product category. This initiative aligns with the EU’s Green Deal and Taxonomy, aiming to promote sustainable production and reduce greenwashing.

PEF aims to create a uniform framework for environmental impact reporting, enabling businesses to make data-driven sustainability improvements and allowing consumers to make more informed purchasing decisions.

Who Needs to Use PEF? 

PEF is not yet mandatory, but its influence is growing and could significantly impact companies selling goods in the EU market. Industries with notable environmental impacts, such as fashion, food and beverage, electronics, and construction, are under heightened scrutiny due to their resource-intensive supply chains and contributions to pollution and waste.

While compliance with PEF remains voluntary at this stage, aligning with its methodology is increasingly seen as a strategic move. Both global corporations and small suppliers within larger value chains may benefit from adopting PEF to demonstrate environmental responsibility and prepare for potential regulatory changes.

Data Collection for PEF

To align with the PEF requirements, companies must focus on data collection across their supply chain. The PEF methodology emphasizes the need for primary data—data specific to the processes and operations of a company’s own supply chain. This is in contrast to secondary data, which relies on generic industry averages.

The data collection includes:

1. Material Composition: The raw materials used in the product, including their source and type.
2. Supply Chain Information: The environmental performance of each step in the supply chain, including energy use, water use, and waste generated.
3. Manufacturing Data: Information about production processes, including energy and resource inputs.
4. Transportation Data: Details about the logistics of transporting raw materials, components, and finished products.
5. Use Phase Impact: The environmental impact of a product during its intended use by consumers.
6. End-of-Life Information: How the product is disposed of, recycled, or reused after its lifecycle ends.

Accurate primary data is essential for calculating a reliable PEF score. Companies that lack visibility into their supply chain will struggle, underscoring the need for robust traceability systems.

Key Milestones in the PEF timeline

PEF is currently in its transition phase, which will conclude by the end of 2024-2025.

• 2025: The EU is expected to finalize PEF guidelines for specific product categories. Pilot projects and category rules (Product Environmental Footprint Category Rules or PEFCRs) are already being tested.
• 2026 Onward: Compliance with PEF is likely to become mandatory for many industries, especially those with significant environmental impacts. Non-compliance penalties may be enforced from this stage.

Ongoing Updates: PEFCRs will continue to evolve to account for advancements in sustainability metrics and data accuracy.

For businesses, the timeline highlights the urgency of preparing now by improving data collection and supply chain traceability.

How to BE Compliant with PEF

To ensure compliance:

1. Understand the Requirements: Familiarize yourself with PEF guidelines and relevant PEFCRs for your product category.
2. Conduct PEF Studies: Use the PEF methodology to calculate your product’s environmental footprint.
3. Invest in Data Management: Collect, validate, and maintain high-quality environmental data.
4. Engage in Verification: Have your PEF studies verified for accuracy if results are used in external communications.

Consequences 

Non-compliance with future PEF mandates could result in:

• Restricted market access in the EU.
• Reputational damage due to perceived greenwashing.
• Loss of consumer trust as sustainability becomes a key purchasing factor.

Companies that fail to prepare may face higher compliance costs when regulations become mandatory.

How Trustrace can Help with PEF Compliance

TrusTrace offers solutions that streamline PEF implementation and ensure compliance:

• Robust Primary Data Collection: TrusTrace enables businesses to collect primary data—such as material composition, supply chain data, and manufacturing impacts—directly from their supply chain. This ensures data accuracy and compliance with the PEF requirements.
  
  
• TrusTrace Integration with PEF Scoring Platforms: Through its partnership with PEF calculation platforms, TrusTrace enhances the accuracy of PEF scores by feeding in detailed, product-specific primary data. This collaboration ensures that your sustainability efforts are reflected in precise, verifiable scores.

Please note: At TrusTrace, we want to keep you informed on laws and regulations, but this information should not be considered or used as legal advice.