Sustainability is becoming a global pressure across industries — an issue we must tackle head-on if we’re to protect the future of this planet. To put the scale of this issue into context, business activities in the EU generate an approximate 166 million tonnes of waste a year.

These staggering numbers underscore the urgent need for retailers to actively contribute to building a more sustainable, circular economy. In today’s marketplace, embracing sustainable practices is no longer optional; it’s becoming a defining factor for business success in the new era of consumerism.

For U.S. retailers, this means greater responsibility in ensuring the products they sell meet rising sustainability standards, while also offering an opportunity to lead the charge in shaping a greener marketplace.

Moreover, it is not just consumers driving the shift toward sustainability; governments are also stepping in to accelerate change. Under initiatives like the EU’s Ecodesign for Sustainable Products Regulation (ESPR) and its recently published Energy Labelling Working Plan, new measures are being introduced to push businesses toward more circular practices.

The EU’s Eco-Movement: The ESPR

Under the European Commission’s Circular Economy Action Plan (CEAP), the EU has introduced the ESPR — a significant shift that entered into force in summer 2024 and will apply to any U.S. enterprise placing covered product groups on the EU marketplace, regardless of where they are produced. The regulation underscores the EU’s push toward a more sustainable and resource-efficient future.

In practice, the ESPR aims to make “sustainable products the norm” in the EU by driving circular business practices. That means products are expected to last longer, use energy and resources more efficiently, be easier to repair and recycle, contain fewer harmful substances and include more recycled content.

The regulation applies to specified product groups across sectors such as textiles and electronics, requiring businesses and retailers to implement Digital Product Passports (DPPs) for products that fall within these categories.

Retailers Need to Get Ready: The Working Plan Update

Although the ESPR itself has now been around for over a year, the 2025 Working Plan update (published in April) officially listed the sectors due to be prioritized by the EU movement. As the Working Plan provides a timeline for the delegated acts — a set of requirements concerning each product group — to be announced, compliance urgency is increasing at speed for retailers across the board, with the textiles industry in particular being listed as an initial target product group. This comes just behind the steel sector, which is due to be the first to comply.

This update in legislation, and its focus on the timeline for the delegated acts to be announced, serves as another reminder that the compliance clock is ticking for retailers worldwide that sell in the EU marketplace.

Moreover, with the Working Plans horizontal requirements such as repairability scoring being highlighted (which could include consumer electronics), recycled content and recyclability of electronic equipment set to come into play from 2027 onwards, it is important to note that electronics retailers are also going to need to get ESPR ready imminently.

The Integral Role of DPPs Amidst the EU’s Action Plan

The integration of DPPs into a business’s ESPR compliance journey is going to prove essential for retailers aiming to tackle the EU’s eco-demands with success.

Essentially acting as a digital record of a physical product, they can securely capture key information across its lifecycle — from the materials used in production and the environmental impact of manufacturing to authenticity details and end-of-life handling guidance. Consumers will typically access this data via a scannable QR code or barcode on the product itself.

For retailers, DPPs represent more than just a compliance requirement under the EU’s ESPR; they also unlock new opportunities to build trust and transparency with customers. By offering visibility into a product’s full journey, DPPs can empower consumers to make more sustainable choices while helping retailers validate their sustainability claims, strengthen brand reputation and guard against accusations of greenwashing.

They also open doors for innovation in retail services: for instance, they could make it easier for retailers to offer take-back programs, resale initiatives and other circular customer processes.

With this in mind, DPPs don’t just support compliance; they can help retailers position themselves as leaders in the transition to a circular economy.

Taking the First Step Toward Compliance – A DPP Solution Strategy

With the ESPR’s Working Plan being recently released, it is likely for retailers to feel overwhelmed by the upcoming regulation and its DPP mandate. This is even more likely amidst the establishment of the horizontal requirements and industry-specific deadlines.

To combat this regulation and start processing the journey ahead strategically, a first step for retailers should be to assign an employee or team to be at the forefront of upcoming compliance efforts.

By prioritizing a system whereby an employee or employees are staying updated on the legislation, retail businesses can ensure they remain abreast of industry-specific updates coming down the pipeline. As part of this, it would be advisable to reach out to a DPP advisor and gain a deeper understanding of the mandate’s industry-specific impact. By doing so, companies can carve out a coherent and bespoke strategy accordingly.

Moreover, to ensure a smooth regulatory journey, businesses should start by mapping where critical product data resides — both within their own operations and throughout their supply chains. During this process, businesses also can start considering which partners are best equipped to support the rollout of DPPs.

Once a solution is in place, piloting becomes the logical next step. For retailers, running a pilot can help test how new processes work across stores, supply chains and customer touch points. It allows them to uncover operational gaps, train staff effectively and collect valuable insights to better anticipate the scale and timing of a full rollout. With this groundwork laid, retailers will be ready to move quickly as new requirements take effect.

For U.S. retailers operating in the EU, the ESPR’s DPP mandate will bring both challenges and opportunities. The recent publication of the Working Plan underscores the urgency of preparing for compliance, while also creating a unique chance for retailers to lead in transparency and garner a more sustainable customer base.

Ultimately, the way retailers approach this legislation will shape their brand’s future. Those that view it as more than a compliance exercise, and instead as a chance to strengthen sustainability credentials and customer trust, will be better positioned to stand out as leaders in the next generation of retail.

---

Matthew Ekholm* is Digital Product Passport and Circularity Specialist at Protokol, responsible for Protokol’s DPP offering as well as understanding and translating customer needs into value-adding solutions. A former Director of Circular Services at a multinational packaging company and a former Operations Manager for Circular Economy Transformation, Ekholm has years of experience helping companies develop new circular business models and unlock new opportunities through an increased focus on sustainability and circularity.*