With rapidly increasing regulations on packaging and packaging waste, such as Extended Producer Responsibility (EPR) and levies on plastic packaging, companies are under increasing pressure to adapt quickly to ensure compliance and competitiveness.

SAP has been making this possible with the solution since 2021 SAP Responsible Design and Production the calculation of EPR fees in different markets. The number of jurisdictions in which extended producer responsibility was mandatory was then 60. This number is expected to rise to 200 by 2030.

As regulatory requirements evolve, SAP has implemented new updates to the solution to help customers navigate varying reporting requirements, timelines and fees while increasing accuracy, reducing fees and risk, and gaining greater insight. Read more about recent innovations and how the solution combines corporate data with information about local and global regulations to determine obligations under the new EU Packaging and Packaging Waste Regulation (PPWR).

Comply with EPR regulations with a flexible, AI-based and configurable approach

To date, SAP Responsible Design and Production has helped customers meet EPR requirements with out-of-the-box reporting categories that are pre-configured based on country. However, the new global legal environment requires a more flexible approach.

Companies need solutions that help them:

• understand obligations and quickly adapt to new or changed regulations,
• merging and processing data from many sources,
• Create reports that require customized reporting logic based on specific business contexts; Reuse rules and fee structures for similar reporting schemes or producer responsibility organizations and calculate EPR fees for shipments and show the results on invoices to provide customers with a breakdown of product costs and indirect taxes.

To address these challenges, SAP Responsible Design and Production has introduced custom reports that allow customers to design their own sustainability reports and tailor them to specific regulatory logic, business context, and particular compliance requirements.

With the new innovations in SAP Responsible Design and Production, users can:

• Structure reports according to the specific rules, producer responsibility organization requirements, and fee models relevant to your business
• Limit data to exactly the packaging and movement data shown in reports
• Meet complex requirements with multiple dimensions used in report output
• Integrate reports into external recyclability assessments
• Meet the needs of the increasing number of producer responsibility organizations that have integrated environmentally tiered EPR fees

AI capabilities for greater efficiency and readiness

The SAP Sustainability portfolio enables AI-powered operational realignment by capturing sustainability data at the source and making core business processes smarter to enable continuous improvements across the board. There are two AI use cases for custom reports in beta testing in SAP Responsible Design and Production:

SAP Responsible Design and Production, AI-powered explanations for custom reports

This feature uses AI to analyze and describe how developed extended producer responsibility rules contribute to the assessment results of selected product packaging. When developing custom reporting categories, EPR reporting professionals may not understand why a particular package was categorized a certain way or was not categorized at all. The AI ​​use case is intended to help troubleshoot and simplify an error-prone process that requires specialists to manually re-examine packaging data and re-evaluate rules.

SAP Responsible Design and Production, AI-powered rule creation for custom reports

This feature uses AI to translate regulatory language into system rules, allowing packaging compliance managers to create and review rules for EPR reports more quickly and accurately. The AI ​​use case is intended to reduce manual effort, avoid costly compliance errors, and enable faster use of reports in different markets.

Equipped for future requirements with AI

Most companies are not prepared for the upcoming EU packaging regulation. This provides for extensive obligations for all economic operators who place packaged goods on the market in the EU. Brand owners, importers, packaging manufacturers, distributors and digital marketplaces are affected. To mitigate risks and be prepared, companies must take immediate action to assess and adapt packaging materials, data systems and reporting.

The detailed management of packaging data in SAP Responsible Design and Production will help companies efficiently meet the requirements of the regulation. With comprehensive data collection and flexible reporting, companies can anticipate regulatory changes and ensure transparency across their entire packaging supply chain.

SAP develops functions for SAP Responsible Design and Production to comply with the requirements Article 5 and recyclability assessments with real product shipment data so companies can assess which changes will have the greatest impact. SAP will provide further information on this topic in future announcements.

An ERP-supported system for numerous requirements

SAP Responsible Design and Production empowers organizations to create reports that meet their evolving needs, creating a flexible, scalable, and future-proof foundation for regulatory compliance. The solution connects design, manufacturing and regulatory reporting requirements to help companies minimize waste, optimize costs and meet global sustainability standards.

In contrast to standalone compliance tools, SAP Responsible Design and Production runs in an ERP-supported system and ensures seamless integration into existing SAP solutions for product master data and transaction data.

Traditional, manually-intensive processes are not enough to keep up with regulations and ensure competitive advantage through new insights from data. A customer using SAP Responsible Design and Production recently confirmed that the solution was four times faster and more cost-effective than manual processes using a spreadsheet or consultants.

With SAP Responsible Design and Production, your company is able to respond quickly and confidently to regulatory changes to ensure compliance while freeing your teams to focus on important tasks.

Listen to this Recording of an online seminar to find out how companies can use SAP solutions to meet the upcoming requirements of the EU Packaging Regulation.

Find out more here about custom reporting capabilities, or request a demo of SAP Responsible Design and Production. Read these customer reports:

Gunther Rothermel is Chief Product Officer for SAP Sustainability.