Life cycle assessment

What it means

Life cycle assessment, or LCA, is a method that evaluates a product's environmental impact from raw material extraction through production, transport and use to disposal or recycling. It looks not only at greenhouse gas emissions but also at water and energy use, pollution and land use.

The methodology is set by the international standards ISO 14040 and 14044. A study starts by defining the goal and system boundaries, continues with an inventory of inputs and outputs and an impact assessment, and ends with interpretation. The result might be a product's carbon footprint or a comparison of two alternatives.

LCA shows where in the chain the greatest impact occurs. For electronics it is often manufacturing, for cars the use phase, for food the farming stage. The company learns where action will achieve the most, instead of focusing on visible but insignificant details.

How it works in practice

Manufacturers use LCA in eco-design, meaning products designed for lower impact, in choosing materials and suppliers, and in communicating with customers. LCA data underpin environmental product declarations and, in future, the digital product passport.

For companies in the supply chains of large customers, LCA is increasingly a requirement. Customers need product data to calculate their own Scope 3 emissions and to report under ESRS, so they ask suppliers for actual figures instead of estimates.

A full study demands a lot of data and time, which is why small companies often start with a simplified assessment using database values. It is essential to state the system boundaries and assumptions clearly, so the results are comparable and defensible.

What to watch out for

Environmental claims based on an incomplete LCA, or on cherry-picked favourable phases, carry a risk of greenwashing. New European rules require claims to be substantiated and verifiable, and misleading information can be penalised.

LCA results depend heavily on the chosen assumptions, such as product lifetime or energy mix. Comparing studies from different companies without a common methodology is misleading; a reliable comparison needs shared rules for the product category.