Aligning the Higg Index Product Tools with Evolving Regulation

  • Higg Index Tools
  • Higg MSI
  • Higg PM
  • Legislation and Policy

In March, Cascale and Worldly held a webinar, “Navigating Legislation & the Higg Index: Higg Product Tools with PEF and more.” In this blog, we share the recording, highlight key takeaways, and address submitted questions during the session.

April 30, 2024

On March 27, Cascale and Worldly hosted the first webinar in a joint series called “Navigating Legislation & the Higg Index.”

The series is designed to showcase how the Higg Index aligns with evolving regulations and how the tools support users through regulatory compliance.

Speakers included Cascale’s Gabriele Ballero, policy and public affairs officer; Joel Mertens, director, Higg Product Tools; Elisabeth von Reitzenstein, senior director of policy and public affairs; Quinten Geleijnse, manager, Higg Product Tools and lifecycle assessments; and Worldly’s Paula Bernstein, senior data manager.

Over 160 attendees joined and raised many thoughtful questions about the future of compliance for consumer goods.

The next webinar in the series “Navigating Legislation & the Higg Index: Higg BRM with CSRD and more” will be held on June 12. Learn more and register.

Key Takeaways

Importance of Product Environmental Footprint (PEF)

“The PEF methodology is likely to play an important role in the future EU product and consumer law legislation. The Higg Product Tools methodology is well-positioned for alignment with Product Environmental Footprint (PEF)/PEF Category Rules (PEFCR), and the Higg Product Tools can support members in navigating evolving legislations and provide guidance in their compliance journeys.” –Elisabeth von Reitzenstein, senior director of policy and public affairs

France: One to Watch

“France has been, and probably will be for the foreseeable future, a frontrunner on sustainability legislation….The French label is based on a type of PEF. It has very strong alignment with the European Product Environmental Footprint principles. One difference on durability is that the French Methodology also includes ‘emotional durability’ to a more committed extent than the European one. This proves again that a common method on PEF is important…Another new French initiative is a draft bill targeting fast fashion and sometimes ultra-fast fashion… Also on the European level, France is fighting its corner on these issues. At a Council of the EU meeting on March 25, it called, alongside Sweden and Denmark, for an EU-wide export ban of hazardous textile waste to developing countries.” – Elisabeth von Reitzenstein, senior director of policy and public affairs

Synergistic Approach, Led by Data

“Through our partnership with Cascale, Worldly is paying close attention to this regulatory landscape and what our customers need in order to prepare and report on their sustainability performance and progress. My team meets at minimum weekly with Cascale to get deep into the weeds on PEF, how it’s evolving, and what it means for our tools and the solutions we’re delivering. The Cascale team also helps us understand the challenges the industry is facing firsthand and ways to address it in the tools. Data is going to play a critical role in many, if not all, of these reporting requirements.” – Paula Bernstein, senior data manager, Worldly

Accessibility is Key

“The concept of accessibility is really key for the Product Tools because we want a variety of users with different levels of LCA knowledge, as well as data availability to produce consistent environmental product footprint results.” – Quinten Geleijnse, manager, Higg Product Tools and lifecycle assessments

Going Beyond Compliance

“Like the rest of the Higg Index Tools, we don’t want the sole purpose of the tools to be compliance – the tools should be going beyond regulation. We’re not just trying to have a PEF-compliant calculator. That is not ambitious enough to get the industry on track to where it needs to be. [The Higg Index] needs to be aligned with PEF, at minimum for compliance, but we do need to go beyond that.” – Joel Mertens, director, Higg Product Tools

Similar, But Difference

“There are a lot of commonalities between Higg Index Product Tools, PEF, and France’s Ademe methodology but we do expect that even with the same product information, it is very likely you will have different results depending on which methodology you’re calculating to or which region you’re calculating to…One of the important things is while there are differences in the results, the impact categories, the data needs, there is a way to bring this all together, and that is the hub concept.” – Mertens

Study Up

“One of the key aspects here is the difference between a footprint calculation and a footprint study, or LCA study. Our tools are calculating an environmental footprint of a product. An LCA study is distinct from the footprint calculation. There are additional requirements that have to be done to take you to that full study level, including a report and verification.” – Mertens

Understanding PEF

“PEF is an implementation of ISO-1440 and 44 standards. There are study requirements associated with that that I think get lost in the narrative. As to other tools in this space, the one thing I will say right now is there is not a final PEFCR for apparel and footwear. There are a lot of claims and misunderstandings as to what you can say in terms of compliance to PEF and PEFCR, and there’s no such thing at this point.” – Mertens

Questions Answered

What sustainability regulations in the EU define requirements regarding the environmental impacts of my products?

On the webinar, speakers discussed relevant EU legislation and initiatives, including:

  • Corporate Sustainability Reporting Directive (CSRD) – [in force] – The CSRD is one of the ‘tools’ in the EU’s Green Deal toolkit, aimed to make the EU climate neutral by 2050. The CSRD establishes a standardized framework for companies to report on their social and environmental impacts through the use of European Sustainability Reporting Standards (ESRS).
  • Ecodesign for Sustainable Products Regulation (ESPR) – [expected mid-2027] – Designed to make sustainable products the norm in the EU, the ESPR sets eco-design requirements for specific product groups, including textiles. The requirements cover key sustainability aspects such as durability, recyclability, and use of recycled content, as well as the creation of a Digital Product Passport (DPP) that will act as a “digital twin” of the garments and aims at enhancing transparency and traceability along the value chain.
  • Substantiating Green Claims Directive (SGCD) – [expected 2025] – Aimed to tackle greenwashing, the SGCD introduces stricter and standardized methodologies for sustainability claims, making claims more reliable, transparent, and comparable.
  • France’s Anti-Waste for a Circular Economy Law – [in force] – The law requires large clothing brands to have verified environmental labeling; smaller companies will have to comply in 2024 and 2025.
  • France’s draft bill targeting fast fashion – [expected 2025] – The draft bill reinforces Extended Producer Responsibility (EPR) schemes for textiles by introducing a penalty for products that are not sustainable or recyclable. This addresses the fast fashion sector specifically.

What is the significance of PEF in relation to these regulations?

These regulations relate in different ways to the Product Environmental Footprint (PEF) method and product footprinting in general. CSRD requires a thorough assessment of an organization’s impacts, risks, and opportunities, and specifically mentions PEF as a way to assess these. In addition, the calculation of scope 3 emissions is required under ESRS E1, for which LCAs and/or PEF studies are useful. ESPR will likely require environmental impacts to be communicated to external stakeholders through the Digital Product Passport, for which PEF and LCA studies can be used. The European Commission proposal for the SGCD sees a more diminished role for PEF in its current form than initially foreseen. Although PEF might not become a mandatory requirement itself under SGCD,  the more simplified procedure now pursued may include a presumption of conformity for environmental claims that are based on recognized methods, such as PEF. The French labeling law is based on calculations obtained from a central database run by Ecobalyse and the Agency for Ecological Transition (ADEME). This method is inspired by PEF but has some noticeable differences.

What is the role of Cascale in drafting the Apparel and Footwear PEFCR?

The PEF category rules (PEFCR) contain specific rules for product categories that complement the PEF methodology. The rules direct focus to the parameters relevant to that specific product group, further standardizing the methodology. The Technical Secretariats (TS) of the EU develop these PEFCRs, and Cascale coordinates the TS developing the PEFCR for Apparel & Footwear, which includes determining the product-specific methodology and primary data requirements. The TS does not determine what secondary datasets are to be used and has to stay in line with the general PEF methodology. The PEFCR is expected to be finalized in Q1 of 2025 and is currently in its consultation phase.

How will the Higg Product Tools evolve to support users on their regulatory compliance journey?

The Higg Product Tools aim to guide product eco-design decisions by providing reliable, high-quality data. Given the legislative developments and the changing data requirements that they cause, the Product Tools should evolve accordingly. Our objective is to develop the Product Tools as a hub that allows different users (with different levels of data availability and LCA knowledge) to compute different types of results for different purposes. This means users can continue to identify impact hotspots and calculate scope 3 emissions, while we expand the tools’ functionalities to allow for PEF calculations. It is important to note that PEF compliance entails more than calculations only as PEF requires an extensive study report that has to be verified by a third party.

Some steps towards PEF-aligned calculations have already been taken by Cascale and Worldly. The current Product Module methodology was developed in alignment with the 2021 version of the PEFCR. This means the Product Tools are already well set up to expand towards PEF-aligned calculations. The team has mapped the key remaining differences between the current Product Tools methodology and emerging regulatory frameworks. This exercise informs Cascale’s product information Member Expert Team (MET) that currently helps define the product-relevant information fields the Product Tools need to contain to align with the data requirements of various frameworks, including PEF, ADEME, and the DPP. As indicated by the workstream flow chart below, Cascale will begin integrating the ADEME and PEF calculation methodologies with the Product Tools when they are finalized. In the meantime, work with the Product Information and Product Impact MET and continue to develop the tools’ hub functionality.

Cascale is working with Wordly to create a harmonized set of information fields for the Product Tools, containing all required information from the different legislative frameworks and distinguishing between mandatory, recommended, and optional data points. This allows users to compute different types of results based on a single set of information and enables the provision of at least some results when limited data is available. Cascale will also expand its current list of five impact categories to the 16 impact categories specified in the PEF methodology. To enable different result types to be computed, different calculation methodologies will have to be integrated into the Product Tools, some of which rely on different datasets than those currently used in the tools. Cascale is working together with Wordly to allow for parallel impact calculations and add these new (EF) datasets to the tools.

Please note that the visual is taken from the webinar slide deck and the timeline reflects the March 27, 2024 webinar date. Depending on when you are viewing this blog post, the visual may be out of date.

Will Cascale integrate the FEM with the Product Tools to allow facility information to be used for product footprinting?

Cascale and Worldly are working together to expand the Product Tools to enable users to select the energy mix used to manufacture their products. This will ensure the country or facility-specific energy mix is considered in the calculations, providing more precise impact calculations. A next step will be to connect the Higg Product Tools with the Higg Facility Environmental Module (FEM) to enable the sharing of facility data to be used for product impact calculations.

Will home goods, home textiles, and furniture be in the scope of PEF? 

While many of our members can and are already using the product tools for homeware and home textiles, PEF currently is explicit for “Apparel and Footwear.” The sectors the EU Commission has identified for PEF are the following:

  1. Apparel & Footwear
  2. Beverages
  3. Chemistry-based final products
  4. Construction products
  5. Electrical & electronics
  6. Food products (including products not for human consumption)
  7. Materials and intermediate products
  8. Energy production and transmission

However, the Product Tools may still be used to assess adjacent products such as home textiles. Even our current Product Module tool has an option for an “other” product category, which is being used by some members to assess these types of products.

Technical Review of the Higg MSI and Higg PM Tools

  • Higg Index Tools
  • Higg MSI
  • Higg PM

We are grateful to KPMG for their work in developing this report, which captures the invaluable insights and recommendations derived from the expert review of the Higg MSI and Higg PM tools.

September 26, 2023