In global manufacturing and trade, material declaration (MD) have become a pivotal aspect of procurement and supply chain management. Buyers in the early stages of their careers, will get a first introduction to the concept of material declarations in this blog post. We’ll explore what they are, their content, examples of legislation across various regions, and provide an illustrating example of a material declaration for a product.

What is a Material Declaration?

A MD is a document that details the composition of a product. It identifies all the materials and substances used in the product, including their chemical and physical properties. This declaration is crucial for compliance with environmental regulations, ensuring product safety, and maintaining transparency in the supply chain.

Content of a Material Declaration

A comprehensive MD typically includes:

• Identification of the Product: Name, model, and description.
• List of Substances: Detailed information on every substance used in the product, including chemical names and concentrations.
• Material Information: Details about the materials used, including sourcing and processing information.
• Safety Data: Information on handling, storage, and disposal of the product and its components.
• Compliance Information: Statements confirming adherence to relevant regulations and standards.

Examples: Legislation in Different Regions

• European Union: REACH (Registration, Evaluation, Authorisation, and Restriction of Chemicals) and RoHS (Restriction of Hazardous Substances) are key regulations governing material declarations.
• United States: The Toxic Substances Control Act (TSCA) and the California Proposition 65 are significant for material disclosure requirements.
• Asia-Pacific: Regulations like China RoHS, Japan’s J-MOSS, and Korea’s Act on Resource Recycling of Electrical/Electronic Products and Automobiles play a vital role.
• Other Regions: Each region may have specific regulations, such as Canada’s WHMIS (Workplace Hazardous Materials Information System) or Brazil’s CONAMA resolutions.

Illustrating Example of a Material Declaration

Product: XYZ Smartphone

• Product Identification: XYZ Smartphone, Model Z123
• Materials Used: Aluminum (chassis), Lithium Polymer (battery), Silicon (chipsets), various plastics (casing), copper (wiring).
• Substances Information: Lead (<0.1%), Mercury (<0.1%), Cadmium (<0.01%).
• Safety Information: Guidelines on battery handling, electronic waste disposal instructions.
• Compliance: Complies with EU REACH, RoHS, and US TSCA.

Material declarations when sourcing

Assuring the sourcing of products with relevant MD is a task for professional buyers. It involves a series of steps and due diligence to ensure compliance, quality, and transparency. Here’s how a professional buyer can achieve this:

1. Supplier Research and Pre-Qualification

• Initial Screening: Begin with an extensive research phase to identify potential suppliers. This involves reviewing their track record, reputation, and compliance history with MDs and environmental standards.
• Request for Information (RFI): Issue an RFI to gather preliminary data about the suppliers, specifically asking about their ability to provide comprehensive MDs.

2. Integrating Material Declarations into the Procurement Process

• RFP/RFQ Requirements: In the Request for Proposal (RFP) or Request for Quotation (RFQ) phase, explicitly state the requirement for MDs. This ensures that suppliers are aware of your compliance needs from the outset.
• Supplier Assessment: Evaluate the suppliers not only based on cost and quality but also on their environmental compliance and ability to provide detailed MDs.

3. Compliance and Certification Checks

• Regulatory Adherence: Verify that the suppliers adhere to relevant regulations such as REACH, RoHS, TSCA, etc., depending on the region and product type.
• Certifications: Check for relevant certifications (like ISO 14001 for environmental management) that demonstrate the supplier’s commitment to compliance and best practices.

4. Sample Analysis

• MD Review: Request a sample MD for existing products to understand the supplier’s capability in providing accurate and comprehensive information.
• Third-Party Verification: Consider getting the material declarations verified by a third party for authenticity and accuracy, especially for critical components.

5. Contractual Agreements

• Incorporate Requirements in Contracts: Ensure that the obligation to provide MDs is included in the contractual agreement with the supplier.
• Regular Updates and Compliance Checks: Establish terms for regular updates to MDs and periodic compliance checks.

6. Ongoing Supplier Management

• Supplier Audits: Conduct regular audits of the supplier’s processes to ensure ongoing compliance with MD requirements.
• Performance Monitoring: Implement a system to regularly assess and review supplier performance in terms of compliance and accuracy of MDs.

7. Staying Informed and Educated

• Continuous Learning: Keep abreast of changes in legislation and industry best practices related to MDs.
• Training and Development: Invest in training for procurement staff to recognize and understand the nuances of MDs and compliance.

8. Building Relationships

• Supplier Relationship Management: Develop strong relationships with suppliers to foster open communication and cooperation, particularly in terms of environmental compliance and reporting.

By following these steps, a professional buyer can significantly mitigate risks related to non-compliance, enhance product sustainability, and maintain a responsible supply chain. Remember, this is a continuous process requiring ongoing attention and adaptation to changing regulations and market conditions.

Full Material Disclosure (FMD)

• Definition: FMD requires a complete listing of every substance contained in a product, down to a very detailed level, often including the exact concentration or percentage of each substance.
• Scope and Detail: FMD is much more comprehensive than a standard material declaration. It involves disclosing all materials and chemicals, including those in trace amounts, used in a product.
• Purpose: The aim is to provide full transparency about a product’s composition. This is often used for more rigorous environmental and health assessments, and for companies aiming to achieve higher standards of sustainability and safety.
• Use in Industry: FMD is more common in industries with high sustainability goals or where products are under intense scrutiny for health and environmental impacts, such as in high-end consumer electronics, pharmaceuticals, or certain food products.
• Example: An FMD for a smartphone would list not only the major components like metals and batteries but also every other substance used in small quantities, like coatings, adhesives, and even the composition of the solder and wiring.

Comparison FMD and MD:

• Comprehensiveness: FMD is far more comprehensive than a typical MD.
• Purpose and Use: Material declarations are often regulatory-driven, while FMDs are used for deeper transparency and environmental/health safety purposes.
• Industry Application: Material declarations are more universally applied across various industries, while FMDs are more specific to industries where complete transparency is a priority.
• Complexity and Cost: Implementing FMD can be more complex and costly due to the need for detailed analysis and reporting of all components.

Summary and recommended further learning

Material declarations are not just paperwork; they are essential tools for ensuring product safety, environmental compliance, and consumer transparency. As procurement professionals, understanding and effectively managing these declarations can significantly contribute to sustainable and responsible supply chain practices. Here are examples of learning opportunities.

While both material declarations and full material disclosures serve to inform about the substances in a product, the extent and depth of information provided vary significantly between the two. Material declarations tend to focus on compliance with specific regulations, whereas FMD provides a comprehensive breakdown of all substances for greater transparency and safety assurance.

The Sourcing Engine room is build around three courses presenting the basics of a modern sourcing process. Learn about the key activities when preparing, negotiating and implementing a new improved supply chain.

Product legislation for buyers by Hans Nilsson. In this course you will learn types of legislation you may be involved in as a Buyer, general requirements in legislation and what to consider as a Buyer linked to relevant legislation.

What a buyer need to know about REACH by Hans Nilsson: This course will provide buyers with a basic understanding of REACH, the roles defined in REACH and what to consider as a buyer in order to comply with REACH.

For those interested in delving deeper, I recommend exploring specific regulations in your region and consulting with legal experts to ensure compliance. Additionally, staying updated with global environmental norms is crucial in this dynamic field.