If you work in sustainability, manufacturing, or supply chain management, you'll know that product compliance is an important part of a manufacturers job . Not only is product compliance one of the main pathways to keep toxic chemicals out of supply chains, it can also have tangible business consequences such as fines from regulatory bodies, or being filtered out of certain markets after failing to meet new standards. If you're just starting your journey into product compliance, or hope to soon, here we will aim to simplify the core steps you will need to follow in order to be successful.
Education
There are many regulations that exist, so it's important to understand all of them and know which ones are applicable to you and your company. Here is a breakdown of the five different regulations that we screen against and provide reporting options for in Toxnot:
California Proposition 65
California Proposition 65 is a law that was passed by Californian voters in 1986 and is overseen by California's Office of Environmental Health Hazard Assessment (OEHHA). The goal of this regulation was to protect drinking water sources from toxic chemicals that cause cancer and birth defects while also reducing and eliminating exposure to consumers through the implementation of warning labels for products that contain these harmful substances. OEHHA maintains a list of toxic chemicals that is available to the public (and is regularly maintained in Toxnot). California Proposition 65 compliance is required to sell products in California.
Conflict Minerals
In 2012, the Securities and Exchange Commission adopted a new rule in the Dodd-Frank Wall Street Reform and Consumer Protection Act. This regulation now requires companies to publicly disclose their use of conflict minerals originating from the Democratic Republic of the Congo (DRC) or an adjoining country. These minerals include gold, tin, tantalum, and tungsten and can often be referred to a 3TG metals. These raw materials have been found to finance conflict in the DRC and this compliance regulation helps reduce the funding that perpetuates this regional violence.
REACH
EU REACH is a European directive that stands for Registration, Evaluation, Authorization and Restriction of Chemicals and is overseen by the European Commission. This regulation was established in 2007 and was created to replace previous legislation for toxic chemicals within the EU. The goal of EU REACH is to ensure a high level of protection for human health and the environment while also promoting alternative test methods and the free circulation of substances to further boost innovation. The EU maintains REACH chemical lists that are available to the public (and are regularly maintained in Toxnot).
SCIP
SCIP is a database for information on Substances of Concern In Products (SCIP) and is part of the Waste Framework Directive (WFD). WFD, like REACH, is an European Union (EU) piece of legislation that creates a structure in which manufactured products are managed and reported. REACH aims to improve protection and reduce risk of human and environmental exposure posed by chemicals. WFD on the other hand addresses the adverse impact of waste generation and improving efficient use of resources to promote the transition to a circular economy. All parts, materials, articles, and objects placed on the EU market containing a substance of very high concern on the REACH Candidate List in a concentration above 0.1% w/w are required to submit SCIP notification.
RoHS
RoHS stands for Restriction of Hazardous Substances (also known as, Directive 2002/95/EC) and is a regulation that was enacted in July of 2006 by the European Union. This standard specifically restricts hazardous substances found in electrical and electronic products, with 10 substances on this restricted list and associated allowance limits for these substances (i.e. <1000 ppm). RoHS exists to prevent hazardous substances from entering the environment and polluting landfills, while also protecting people from exposure during manufacturing and recycling. Any business that sells or distributes electrical and electronic products to EU countries must be RoHS compliant.
Once you have a better understanding of what's required of your company and which regulations you will be targeting, you will need to make sure you have the appropriate resources to successfully and reliably report back on compliance.
Resources
Understanding your resourcing needs as you begin your journey towards product compliance can make or break the success of your efforts. You also need to appropriately gauge whether or not a resource is fit to grow with your company as your needs expand and change. Here are three key factors to consider when choosing your human-centered and software resources.
Resources - First things first, make sure you have the time and expertise allocated internally to successfully meet the requirements of product compliance. Work with your teams to make sure you have the correct personnel resources to meet these requirements as well as a budget to help set up the infrastructure you need.
Infrastructure - As you collect compliance data from your suppliers, it is essential to make sure that you have a central location to store that data where it can be easily accessed and used for compliance reporting. When choosing a tool, make sure it is something that is easy to maintain and has the flexibility and capacity to grow with your company. It's also great to consider products that will help you automate compliance determinations in order to avoid the manual work that would otherwise follow.
One of our largest areas of focus here at Toxnot is being a product compliance solution. You can use Toxnot to survey your supply chain, store all of the data gathered from that supplier outreach, then easily use that information to create compliance reports. Toxnot can also help you automate your compliance - once the data has been collected, Toxnot will automatically screen your data against the 5 different compliance regulations and notify you of any changes that affect your company's products. With or without a sustainability consultant, Toxnot can be your one-stop-shop for all of your product compliance needs.
Plan & Anticipation
With any new long-term undertaking, it's important to make sure future growth is kept front of mind as you start to make commitments. Product compliance is no exception. You will need to establish the following:
Resources - Select your software resources and make sure they are scalable. Review step 2 again for more considerations that should be taken into account.
Business Case - Make sure the business case for product compliance is clear and well-defined internally. This will help ensure that you and your team are provided with the appropriate resources aligned with the value you are providing to your company. You can read more about product compliance and its business case here.
Internal Buy-in - Make sure you have internal buy-in and that the objectives you are trying to meet are clear. Dissonance across your team can lead to stress and lack of productivity, both of which can hinder your compliance goals.
Collaboration - Lastly, establish collaboration across your teams. Pursuing compliance usually requires efforts from multiple teams such as the purchasing department, engineering, and compliance teams. Make sure you coordinate and set expectations early on.
Data Collection & Management
As mentioned above, pursuing product compliance will almost certainly require some level of supplier outreach. For most compliance regulations you will either need full material disclosure (FMD) from your supplier, or formal determination or testing documents confirming compliance for the regulation in question. It is also recommended that you have a planned approach for data storage and management to ensure easy reporting and accessibility for potential data audits. Creating a strong foundation for successful supplier outreach is absolutely key.
In addition to regulatory screening and reporting, Toxnot also has a robust feature set designed for supplier outreach. Within the system you can customize surveys using our already built-out compliance questions, send surveys and reminders, then accept data that flows automatically back into your library of data. For surveying about many of your materials, this automation and scalability is key. It makes the data reachable and easy to maintain over time.
Once that data is received, you're off to the races. You can use our compliance modules in Toxnot to see if each of your products are compliant against the five regulations. Using this information, you can confidently report back to your customers and most importantly, identify products and materials within your supply chain that should be re-evaluated for safety and hazards.
Reporting & Next Steps
Once you've successfully received and reviewed your supply chain data, you should be ready to report back to your customers and stakeholders. In this stage of your product compliance efforts, you should be able to accurately determine whether or not a specific product or material is compliant with a regulation or not. If you're unable to answer this question, you likely need to revisit step 4 to get that information. As mentioned in step 1, education regarding the different compliance regulations and their relevance to you is essential. Once you've narrowed that down, the data gathered from your suppliers will need to be cross-referenced against the regulatory lists to determine a product or material's compliance standing. In this stage, a software tool to help you with the leg-work will make an enormous impact. Once you know the compliance determination, communicating this to your customers and the regulatory bodies is all that is left.
Within Toxnot, your data will automatically be screened against the regulations to provide you with a compliance determination. With that information, you can use Toxnot to create an automated compliance report. With the click of a button you can show your customer that you've done your due diligence and are committed to product safety.
While the road to product compliance may not be "easy", with Toxnot we'll make your product compliance goals more than attainable. If you're ready to start reaching your product compliance goals we're here to help! Schedule some time to chat with us about your product compliance needs and view a personal demo of Toxnot from our team: Schedule time now.
