First of all: What is LCA?
The Life Cycle Assessment (LCA) analysis is the most complete tool for assessing the environmental impact of products and services.
Formalised in 1993 at the SETAC (Society of Environmental Toxicology and Chemistry) Congress, it is a scientific method based on the collection of data that allows results to be replicated or modified and considers the human-environment relationship in a holistic manner, making it the most effective method among those currently in existence.
In practice, companies use it to measure the effects that a product or service has on the environment throughout its entire life cycle, i.e. at each stage of the supply chain that brings it to market and beyond.
These stages, in brief, are:
- the procurement of the resources needed for production
- the actual production of the good
- storage of the good together with other goods, packaging, transport
- distribution to customers and retailers
- its use
- its disposal and that of its packaging.
Each of these phases brings with it a series of activities that, depending on how they are carried out, cause greater or lesser negative effects on the environment. LCA analysis makes it possible to quantify them.
5 reasons why a company should do an LCA analysis
Advantages are many, the first of all? The competitive one.
Thanks to LCA analysis, it is possible to precisely identify areas where environmental performance can be improved, to implement the necessary changes, and to reap the benefits, both ecologically and economically.
What are we talking about? About the benefits of improving your LCA score. And which are those? Here they are:
- you can obtain the most important environmental labels in Europe (type I and type III eco-labels and in particular the EPD, which we will explain to you in a moment) and the consequent image benefits: without an LCA analysis as the basis for these voluntary labels, there is a high risk of greenwashing and incurring penalties with serious repercussions on company reputation
- thanks to these labels, it is possible to reach new target customers by responding to a growing trend: according to various studies including the authoritative Nielsen survey, in fact, Millenials and GenZ are consumers who are highly attentive to environmental sustainability
- you get access to GPP (Green Public Procurement), an environmental policy tool that, through the lever of public demand, intends to contribute to the 2030 Agenda goals. In substance, the Public Administration, which in Western societies is the largest consumer of goods and services, influences the market by favouring and promoting a green production chain, especially through the inclusion of environmental criteria in the scores of tenders and bids
- it is possible to assess the performance of a product and compare it with the ‘best in class’, i. e. the best in its category, thus benchmarking in order to improve the design itself, from the choice of materials to the choice of technologies, passing through the purchasing decision-making process and the innovation systems to be adopted (we’re talking about the famous concept of ecodesign)
- you move towards the circular economy and the savings it entails: one of the objectives is in fact for the product to turn into waste as late as possible, thus saving on disposal costs and production costs, because it goes back into the supply chain to create new value instead of being sent to landfill to die.
And then, in addition to all this, laws and regulations are demanding more and more strictly to comply with the principles of circularity and sustainability, consider for example the EU’s Circular Economy Action Plan or the concept of EPR and the obligations that are developing around this.
Beware, however, because the LCA remains a tool to support decisions that lead to the fulfilment of these directives and is not a decisive tool in itself. It is only the first and fundamental step.
How does LCA analysis work?
The LCA methodology is regulated by European standards and in particular by the ISO 14000 series of standards on the environmental management of organisations. More specifically, it is standards 14040 to 14044 that define the principles, requirements and guidelines for an LCA, which ultimately consists of these 4 phases:
- Goal and scope definition (ISO 14041):
this defines the purpose of the analysis, the functional unit used (kg of product, t of waste treated, kWh of energy supplied, etc.), the areas of study, the method of data collection, the starting hypotheses and limits, the players responsible for the study and analysis of the results, the quality requirements.
- Life cycle inventory (LCI) analysis – Compilation of an inventory (ISO14041):
the data on all inputs and outputs (in terms of both mass and energy) of the production system related to the product or service under consideration are collected and processed.
- Impact Assessment – Evaluation of environmental impacts (ISO 14042):
After having calculated, in the inventory, the consumption of resources and the CO2 emissions into the environment, this stage assesses the potential environmental impact of all those inputs and outputs of the production system considered, i.e. of all phases of the life cycle of the product or service.
- Improvement Assessment – Interpretation of results and evaluation of improvements (ISO 14043):
In this final stage, the results of the inventory analysis are compared with those of the impact assessment and conclusions are drawn to reduce the environmental impact of the production processes under analysis.
For example? It can be assessed that the energy used for production is too high and ways can be found to reduce it, or that it is the energy consumed by the product during its operation that needs to be lowered, or that the environmental cost of disposal is too high, that CO2 emissions need to be reduced, etc.
The results can also be used just to compare similar products and decide which one is worth focusing on, to improve an existing product or to create a new one… in short, the analysis can serve various purposes; it depends, of course, on what your company needs at that moment.
LCA analysis and EPD labels
We mentioned earlier that one of the advantages of LCA analysis is that it allows you to obtain environmental labels without the risk of incurring penalties and jeopardising your brand position.
But for which labels in particular is LCA crucial?
- For Type I eco-labels, i.e. those voluntary labels submitted for external certification (by a public or private body) that consider the entire life cycle of the product by setting minimum environmental performance values. The most important of these is the EU Ecolabel.
- For Type III eco-labels, also known as Environmental Product Declarations – EPDs. The EPD, we might say, is the final report of an LCA, as it transparently reports objective, comparable and third-party verified data on the environmental performance of a product or service over its entire life cycle.
The importance of EPD is constantly growing and indeed more and more companies are deciding to obtain them.
Why? Precisely because of the advantages we listed above!
LCA, as we have seen, is a key factor in a market that is moving increasingly (and more and more will be forced to do so) towards the green.
But it is not so simple: it is a very complex methodology that requires time and initially high costs (including those for purchasing one of the dedicated softwares) and that absolutely presupposes the training of qualified personnel, should the company decide to carry it out internally.
So what? No, you must not give up, and forget scepticism: doing business nowadays also means this, otherwise you would risk being excluded from the market or incurring heavy fines. The advice, therefore, is to address external companies, specialised in consultancy and corporate sustainability paths… and who knows, maybe Nazena will soon become one of them! 😉
LCA: a fundamental tool for your company
Sfridoo News, 15 July 2020
Life Cycle Assessment
Environmental Label, consulted in November 2022
European Commission – Environment, consulted in November 2022
The International EPD System
EPD, consulted in November 2022
Environmental Product Declaration
ISPRA, consulted in November 2022