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Ezzat Tanzila Evana

June 10th, 2024

Digital Product Passports: Climate Emergency and Bangladesh’s RMG Industry

0 comments | 11 shares

Estimated reading time: 10 minutes

Ezzat Tanzila Evana

June 10th, 2024

Digital Product Passports: Climate Emergency and Bangladesh’s RMG Industry

0 comments | 11 shares

Estimated reading time: 10 minutes

Bangladesh remains very vulnerable to climate emergencies & climate-induced disasters, now and in future. Some of its most important economic sectors — like the Ready-made Garments (RMG) industry — have a high environmental impact. In this post, Ezzat Tanzila Evana looks ahead, and discusses if and how European-style Digital Product Passports may be a viable way forward for this important industry, ensuring economic stability, environmental sustainability and an enlightened consumer. 

 

Bangladesh, ranked as the seventh-most extreme disaster risk-prone country in the world, stands at the forefront of climate adversity. A recent analysis indicates that Bangladesh is likely to lose US$27 billion in ready-made garment (RMG) exports annually by 2030, and US$711 billion (or 68.5 per cent of all RMG exports) by 2050 if it does not adopt climate-adaptive policies.

In light of this impending climate catastrophe, Bangladesh’s RMG sector, vital to the nation’s economy, is under growing pressure to reduce its environmental impact — in waste management, water use and greenhouse gas emissions. Since necessity brings innovation, the digital landscape needs to be exploited for creative environment-conscious business models.  But such models can only be sustained if the complete production cycle (along with the value chain) are integrated with environmentally/climate-friendly systems.

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Consciousness should not come only from producers but also from the consumers. Product information promotes environmentally-conscious consumers and aids in the promotion of sustainability by being transparent about the product’s life-cycle. The significance of sharing product data is visible in the Digital Product Passport (DPP) which has gained traction in the European Union’s green initiatives to reduce carbon footprint. In brief, the DPP is a digital record that provides comprehensive information about a product and its entire supply chain. It contains data from the origin of the product and the materials used in its production, to its environmental impact and disposal recommendations. In the context of the RMG industry, a DPP could include data on sourcing of raw materials, manufacturing processes, energy consumption, water usage, and carbon emissions associated with each garment. It could cater to Extended Producer Responsibility (EPR) which aims to cover the life-cycle of a product from source to stages of production to disposal. For example, from November 2023 Swedish apparel companies have started to include an thorough analysis of the environmental impact of its product on client receipts. These receipts give consumers transparency regarding the environmental impact of every purchase by listing the energy, water and carbon emissions of each item of clothing they have purchased.

The impact of DPP in combating climate challenges can be seen on multiple fronts. Tracing environmental impact of products by calculating the overall carbon footprint from production to disposal increases transparency, which in turn establishes accountability among manufacturers, encouraging them to adopt more sustainable practices to reduce environmental impact and mitigate climate change. Such transparency and accountability will lead to an efficient supply chain mechanism. When the data of raw materials, production process and disposal risk towards environment is disclosed to consumers, the supply chain will seek to optimise its operations, which will lead to reduced energy consumption, lower greenhouse gas emissions and decreased waste generation, contributing to climate mitigation efforts.  It will also promote social justice by disclosing the location of production and the workers involved in the production so that any form of labour/human rights violation will be navigated and addressed for social governance. It will make the manufacturing and material procurement processes verifiably ethical and sustainable, driving demand for eco-friendly and climate-conscious garments. This shift in consumer behaviour will incentivise RMG companies to prioritise sustainability and invest in green technologies.

As citizens become increasingly aware of climate justice and care how environmentally sustainable a product is, the DPP will assist the consumer to take informed decisions about products. DPPs empower consumers and, simultaneously, drive the demand on eco-friendly and climate conscious garments. By providing access to a product’s journey and information about its production, companies can build trust and loyalty among consumers who value transparency. It will create a loyal customer base for the company.

The DPP should also be ranked like any typical passport and countries too can set targets about which ranked product may be enter a country, and set import tariffs according to the ranking of the product. The whole process will have a ripple effect. When sustainable consumption will be trending, all other sectors — from Fast-moving Consumer Goods (FMCG) and pharmaceuticals to agricultural products — will follow. Change will not only occur due to conformity but a proactive policy document like EPR will actively encourage producers to ensure sustainable methods. Finally, the DPP will organically serve the execution of EPR as it will serve as a provider of data which will help to profile products and producers.

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Even though a DPP is very promising, there are challenges to make it work effectively. The first challenge is data standardisation. Setting common standards that will be accepted by all the industries will likely be a complicated and long process. But it can be achieved by targeted consultation with similar product industries, mapping the common indicators to report and grades that will translate into Likert scale good, very good, bad, very bad. The ranges may vary from industry to industry but the rationale and identification of the range would be the same.  Other challenges include limited technological infrastructure, inadequate data management systems and resistance from stakeholders. Moreover, ensuring widespread adoption and compliance across diverse RMG enterprises poses logistical hurdles. Overcoming these challenges will require concerted effort from the government, industry stakeholders and international partners to develop robust frameworks and capacity-building initiatives to make the DPP work effectively and sustainably. Finally,  EPR guidelines need to incorporate DPP as a binding clause for businesses/industries,  which should be linked to the bigger database of EPR regulated by DPP.

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The views expressed here are those of the author and do not represent the views of the ‘South Asia @ LSE’ blog, the LSE South Asia Centre or the London School of Economics and Political Science. Please click here for our Comments Policy.

This blogpost may not be reposted by anyone without prior written consent of LSE South Asia Centre; please e-mail southasia@lse.ac.uk for permission.

Banner image © Keagan Henman, 2018, Unsplash.

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About the author

Ezzat Tanzila Evana

Ezzat Tanzila Evana studied International Social and Public Policy at LSE; she has been Policy Analyst at BRAC, Dhaka for 5+ years, and is interested in development and climate change. 

Posted In: Bangladesh

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