Design for environment


This report provides strategic information on using design for environment practices to help Canadian product design and development service providers and their supply chain partners introduce new and innovative product concepts, and compete both domestically and internationally.


Sustainable development is becoming a guiding objective of economic and technological advancement as individuals and firms grow more aware of and concerned about their impacts on the environment. Design for Environment (DfE) is one aspect of this overarching objectiveof sustainable development. DfE focuses on improving environmental impacts over a product life cycle byincorporating environmental considerations into product design. In today’s complex business environment, theextent to which firms use DfE practices is a key determinant of their competitiveness.

Industry Canada has partnered with the Design Exchange (DX) and Canadian Manufacturers andExporters (CME) to review this valuable service business function. Drawing from a survey and intelligence from industry, and using economic analysis from Industry Canada, this industry–government partnership has produced the first assessment of DfE usage by Canadian design service providers and their business partners. This unique analysis is intended to help Canadian product design and development executives as well asdecision makers understand current trends and recognize the advantages of adopting DfE practices to improvebusiness competitiveness.

Design for Environment is a valuable activity that enables Canadian firms to improve their business competitiveness on many levels.

Key findings

  • Best-in-Class (BiC)Footnote A firms are able to better differentiate their products, increase sales, and access foreign markets.
  • Main DfE business drivers include corporate responsibility, need for product differentiation,customer demand for environmentally friendly and energy efficient products, and regulatory compliance.
  • Firms are using several DfE strategies including: design for resource and emission efficiency; designfor recyclability, disassembly, and environmentally friendly disposal; and design for reduced packaging.
  • Small– and medium–scale businesses have difficulty financing DfE related investment, lack the knowledgeto implement DfE practices, and are less aware of the business benefits.

Approach and methodology

This report is based on a collaborative undertaking between the DX research committee, the CME, and Industry Canada’s Service Industries and Consumer Products Branch. The DX research committee and the CME defined industry needs, drivers, and metrics and offered valuable insights from an industry perspective. By using information from industry partners and international market research organizations, and by applying unique economic models developed in-house, Industry Canada provided the overall analysis and brought together all the components needed to produce Canada’s first Design for Environment report with competitive performance parameters.


It is estimated that over 80 percent of all product–related environmental impacts are determined during the design phase of a product.1 Businesses that design environmentally friendly (i.e. highly recyclable or energy efficient) products for their customers are successfully differentiating themselves. This trend emphasizes the importance of using Design for Environment (DfE) practices tohelp Canadian product design and development service providers and their supply chain partners introduce newand innovative product concepts and compete both domestically and internationally.

DfE integrates environmental considerations into the product design and development process. Firms use DfE practices toimprove the environmental performance of products while reducing cost, boosting their competitive advantage, andstimulating innovation.2 The DfE process can involve designingproducts that use environmentally friendly materials, fewer resources, and/or less packaging. DfE can also focus on designingproducts that are more easily recycled, reused, or upgraded.

Goals of DfE3 can include:

  • Reducing or eliminating waste throughout the product life cycle;
  • Meeting or exceeding regulatory goals;
  • Reducing energy consumption throughout the product life cycle;
  • Improving logistics to minimize transportation throughout the product life cycle; and
  • Maximizing the use of recovered materials and energy throughout the product life cycle.

In general, investment in a new business process such as DfE should be supported by a business plan thatoutlines a demonstrable return on investment. For this reason, Industry Canada has partnered with the DesignExchange (DX) and Canadian Manufacturers and Exporters (CME) to initiate research on DfE practices and their business benefits. Specific business benefits include greater product differentiation, successful compliance, increased sales, new access to foreign markets, better customer retention, and improved cost reduction.

It is expected that this research will help inform policy makers of current and future industry needs by identifyingindustry perspectives, issues, and drivers related to DfE practices.

In particular, this report assesses the:

  • Use of DfE practices by industry;
  • Internal and external pressures involved in adopting DfE practices;
  • Specific DfE strategies that businesses use; and
  • Business benefits that Best–in–Class (BiC)businesses gain.

Drivers and adoption


A wide range of pressures are driving North American firms to adopt DfE practices, including increased corporate responsibility, greater product differentiation, growing customer demand for environmentally friendly and energy efficient products, and improved compliance processes. Compliance refers to their conformity to regulations as well as to how firms meet and respond to corporate objectives (Figure 1).

Figure 1: Drivers for the adoption of DfE practices4

Drivers for the adoption of DfE practices (the link to the long description is located below the image)

Description of Figure 1

Figure 1: Drivers for the adoption of DfE practices4
% of North American firms
Corporate responsibility 37%
Product differentiation 35%
Customer demand for eco-friendly products 28%
Compliance 26%
Customer demand for energy efficiency 23%

For example, the most common DfE driver for North American automotive and consumer product goods (CPG) firmsFootnote B is corporate responsibility, as these companies strive to be viewed as proactive and environmentallyfriendly by their customers. The most prevalent DfE driver for North American aerospace and industrial electronics firms is compliance with environmental regulations on both regional and global levels, with the aim to improve access to foreign markets.4

Many regions have regulatory bodies in place to implement environmental regulations on products. To increasetheir export capability, firms should design products to meet the environmental regulations in each potentialexport market. One example is the European Union's Restriction of Hazardous Substances Directive (RoHS). The goal of the RoHS is to reduce the use of hazardous substances such as lead, cadmium, and mercury in theproduction of new electric and electronic equipment sold in the European Union.5 Canadian businesses that wish to access the European market should design new products that comply with such hazardous substance restrictions.

To sell domestically, Canadian firms should also design products to meet Canadian environmental regulations.6 In addition, some provinces have extended producerresponsibility (EPR) concepts that include DfE elements and/or set out product reuse and refurbish targets.


DfE practices can be implemented exclusively within organizations or in collaboration with customers and/or suppliers. Currently, 30 percent of Canadian manufacturers implement DfE practices within their organizations. Of these, 39 percent are doing so in collaboration with their customers and 19 percent are doing so in collaboration with their suppliers (Figure 2).

Figure 2: Collaboration in DfE practices7

Collaboration in DfE practices (the link to the long description is located below the image)

Description of Figure 2

Figure 2: Collaboration in DfE practices7
% of Canadian firms (DfE within organization)
Collaborating with customers 39%
Collaborating with suppliers 19%

Compared to large–scale businesses, fewer small– andmedium–scale Canadian businesses are adopting DfE practices. Within organizations, 40 percent of large businesses are implementing DfE practices, whereas only 20 percent of small–scale businesses are doing so in–house (Figure 3).

Figure 3: Adoption of DfE practices — Business size7

Adoption of DfE practices - Business size (the link to the long description is located below the image)

Description of Figure 3

Adoption of DfE practices - Business size7
% of Canadian firms
  Within organization With customers With suppliers
Large ($250M +) 40% 17% 10%
Medium ($25M - $250M) 34% 9% 3%
Small ( 20% 7% 3%

Often this difference is due, in part, to the substantial capital investment required and the high cost of technologyneeded to implement DfE practices. Small– and medium–scale businesses have difficulty financing the investment required to implement DfE practices. In addition, some small– and medium–scale firms are less aware of the business benefits related to DfE and lack the knowledge to implement DfE in their product design and development process.8

The adoption of DfE practices also varies by industry. For example, nearly 50 percent of Canadian automotive, aerospace, and industrial electronics firms are currentlyadopting DfE practices compared to only 20 percent of CPG firms (Figure 4). One reason for this difference is that automotive and aerospace firms are using processes and concepts that ease DfE adoption. For some time now, Canadian automotive firms have embraced lean conceptsin their operations that focus on increasing efficiency and reducing waste. Taking a long–term view allows firms that adopt lean processes to transition to making more environmentally friendly products with greater ease.8

Figure 4: Adoption of DfE practices — Industry7

Adoption of DfE practices - Industry (the link to the long description is located below the image)

Description of Figure 4

Figure 4: Adoption of DfE practices - Industry7
% of Canadian firms
  Within organization With customers With suppliers
Automotive 48.8% 9.3% 4.7%
Aerospace 47.2% 8.3% 5.6%
Industrial Electronics 45.2% 9.5% 4.8%
CPG 25.0% 16.7% 5.6%

For Canadian aerospace firms, DfE practices are highly interrelated with Six SigmaFootnote C design processes. For a number of years, Six Sigma methodology has been used by aerospace businesses to design products to be as flawless as possible. Frequently, this focus on increased design quality leads to other DfE–related advancements, such as parts and materials that have a longer useful life.3 Industrial electronics firms have been adopting DfE practices due to the high level of environmental compliance required to access foreign markets.8

For CPG firms, the shift to DfE is relatively new, but a niche environmental market is emerging. Currently, some CPG firms are targeting sub–groups of the populationthat are more sensitive to environmental considerations in their lifestyles. In the medium to long term, thismarket is expected to expand.8 Relatively more CPG firms do, however, have DfE practices in place with their customers due to the fact that some of these CPG firms supply private label productsFootnote D to retail chains that have environmental product mandates.

Even though DfE adoption is currently limited in Canada, DfE practices are expected to become morecommon in industry as the cost of raw materials and energy increases and as consumer concern of environmentalimpact heightens.2

DfE Strategies

Canadian firms implement different DfE strategies according to the environmental goals associated witheach newly designed product. DfE strategies can be broken down into three general categories: design forenergy and emission efficiency; design for recyclability and environmentally friendly disposal; and design forreduced packaging.

Design for energy and emission efficiency

Manufacturers, in partnership with their design service providers, are using DfE practices to achieve greaterenergy and emission efficiency in their products. For example, approximately 40 percent of North American automotive and automotive parts firms with DfE practices in place are designing products that are more energyefficient and produce fewer emissions (Figure 5).

Figure 5: DfE practices for energy and emissions efficiency4

DfE practices for energy and emissions efficiency (the link to the long description is located below the image)

Description of Figure 5

Figure 5: Design for environment practices for energy and emissions efficiency4
% of North American firms with DfE
  Designed for energy efficiency Designed for lower emissions
Automotive 42% 36%
Aerospace 32% 27%
Industrial Electronics 32% 14%

Using DfE practices, automotive and automotive parts companies are developing solutions for hybrid and electric vehicles and creating green technologies such as hydrogen fuel cells.

Aerospace firms, meanwhile, are focusing on energy and emission efficiency in aircraft design. Aircraft enginesare now being designed to emit less carbon dioxide and nitrogen oxide while burning less fuel. In addition,aircraft are being designed to emit less noise pollution, which enables them to land at inner–city airports andthereby decreases the need for long–distance passenger commuting. Aerospace businesses are also integrating advanced materials such as carbon fibre and Kevlar into their aircraft to reduce aircraft weight and increase fuel economy.8

Industrial electronics and CPG firms are also focusing on designing more energy efficient products. For example, many electronics items are now designed with power management features such as low–power standby modes, and some CPG products, such as household appliances, are being designed to meet energy efficiency standards.Footnote E

Design for recyclability and environmentally friendly disposal

Since North American CPG firms view consumer demand for environmentally friendly products as an important DfE driver, it is not surprising that approximately half of CPG firms focus on designing products that use more recycled materials and/or can be disposed of in an environmentally friendly manner (Figure 6).

Figure 6: DfE practices for recycling and environmentally friendly disposal4

DfE practices for recycling and environmentally friendly disposal (the link to the long description is located below the image)

Description of Figure 6

Figure 6: DfE practices for recycling and environmentally friendly disposal4
% of North American firms with DfE
  Designed for recycled/reused Designed with recycled materials Designed to be environmentally disposed
CPG 52% 52% 45%
Automotive 42% 42% 36%
Industrial Electronics 11% 11% 24%
Aerospace 4% 15% 27%

Cleaning product firms, for example, are creating products that contain minimal amounts of harmfulcompounds (such as ozone–depleting compounds and volatile organic compounds that contribute to smog,tropospheric ozone, and poor air quality). Other CPG businesses (such as in the beverage sector) are using DfEpractices to produce low–cost, recyclable containers to reduce waste. A large proportion of CPG firms also focus on design for recycling because many CPG products have a short product life cycle.8

Design for recycling is also important for automotive companies; it involves designing parts that are madewith recycled materials that can be recovered and reused from end–of–life vehicles. For example, some vehicle seats are designed to be manufactured with fabric made from 100 percent post–industrial materials. Aerospace firms are relatively less focused on DfE for recycling, which is relatedto the 30–plus year lifespan of their products. With such a long product lifespan, aerospace companies realize thebenefits of DfE for recycling much later than companies in other sectors.9

Optimal disassembly is an important aspect of DfE toconsider when designing a recyclable/reusable product. Design for Disassembly (DfD) is a concept embedded in the larger DfE framework that considers product assembly configurations that allow for economicallyefficient separation of recyclable components.10

Successful DfD includes applying three disciplines: theselection and use of materials; the design of components and the product architecture; and the selection and useof joints, connectors and fasteners. An example of DfD is the use of fasteners made from shape memory polymers or alloys in a product. These types of fasteners change shape when exposed to a temperature threshold, allowing them to be easily removed from a product and reducing the time for disassembly.11

Design for reduced packaging

Design for the purpose of reducing packaging is a strategy often used by CPG firms; in fact, 52 percent of North American CPG firms with DfE practices in place focuson reducing packaging (Figure 7). An added benefit of implementing DfE practices in this sub–sector is that it often results in newly designed products that can be packaged in less space, thus helping companies also save on logistics costs. This process allows industry playersto better comply with retail chains' green supply chain management mandates.Footnote F

Figure 7: DfE practices for reduced packaging4

DfE practices for reduced packaging (the link to the long description is located below the image)

Description of Figure 7

Figure 7: DfE practices for reduced packaging4
% of North American firms with DfE
Consumer Product Goods 52%
Industrial Electronics 35%
Aerospace 27%
Automotive 17%

North American CPG firms are reducing their packagingfootprint by implementing DfE in several ways.Some examples include: designing packaging that canbe reclaimed; integrating biodegradable, reclaimed, orrecycled materials into packaging; and integrating packaginginto the product itself.12

Business context and benefits of DfE practices

Many firms still face challenges in the implementation of DfE practices, such as the high financial costs of the technologies involved and the complex task of integrating DfE processes into existing product design and development frameworks. Nevertheless, not only are some Canadian firms using DfE, but they are also gainingsignificant business benefits as a result.

Making the shift to DfE requires consideration and adoption of new approaches. Since the design process often uses advanced technologies such as computer–aided design, virtual product development, and rapid prototyping, making complex changes and adjustments to both the design process and its related technologies costly. In addition, the benefits of designing environmentally friendly products can be difficult to quantify,hindering a business' ability to justify the large investment needed. The International Organization forStandardization has a technical report (ISO/TR 14062) that provides a process model to help guide firms tointegrate environmental thinking into the product design and development process.13

Best-in-Class analysis

With the increasing implementation of sustainable development concepts, DfE is being put into place as part of a firm's global environmental framework that includes green supply chain management practices.Footnote G

BiC firms are defined as businesses that achieve positive results in the two main environmentally specific activities: improved product environmental impact and energy efficient distribution practices. BiC firms are often leaders in their respective industries. Currently, 10 percent of Canadian manufacturers meet these criteria while gaining significant business benefits such as:

  • Increased product differentiation;
  • Successful compliance;
  • Increased sales;
  • Improved access to foreign markets;
  • Increased customer retention; and
  • Decreased cost.

Nearly 90 percent of BiC businesses are seeing improvements in successful compliance processes, product differentiation, foreign market access, and increased sales. In addition, these businesses are making significant gains in customer retention and cost reduction as a result of adopting such practices. Specifically, at least 40 percent of BiC firms have reported a 20-50 percent improvement in the six aforementioned business achievements, and 10 percent of BiC firms have noted an improvement of over 50 percent in product differentiation (Figure 8).

Figure 8: Business benefits — Best-in-Class businesses7

Business benefits - Best-in-Class businesses (the link to the long description is located below the image)

Description of Figure 8

Figure 8: Business benefits - Best-in-Class businesses7
% of Best-in-Class
  Improved 1–19% Improved 20–50% Improved 50% +
Decrease cost 40% 40% 0%
Customer retention 40% 40% 0%
Access to foreign markets 45% 45% 0%
Increase sales 50% 40% 0%
Compliance 40% 50% 0%
Differentiate products 40% 40% 10%

By developing designs for products free of hazardous materials, a firm can reduce the time and resourcesrequired to obtain regulatory approvals and meet existing regulations. Simultaneously, a firm can realize costsavings by reducing the use of materials that have high disposal costs.14

Furthermore, by developing environmentally friendly products, a company can strengthen its reputation ofcorporate responsibility, which can improve customer retention and help further differentiate a product fromother market alternatives.13 Moreover, firms may be able to increase their market share and access new foreign and domestic markets by using DfE to add environmentallyfriendly features to their products. For example, as private and public organizations develop procurementguidelines for environmentally preferable products, Canadian firms with established DfE capabilities will beable to take advantage of such "green" procurement policies and increase their market share.8

These associated business benefits differ for each specific industry (see Annex I for detailed BiC sectoral analysis).For example, all Canadian BiC automotive businesses report some improvement in foreign market access and increased sales. BiC aerospace businesses are seeing the greatest gains in foreign market access, increased sales, and decreased cost. Furthermore, 80 percent of BiC aerospace businesses have reported some improvements in product differentiation, successful compliance and customerretention. All Canadian BiC industrial electronics businesses have reported gains in all six business achievements. Approximately 75 percent of BiC industrial electronics businesses have seen an improvement of 20-50 percent in successful compliance, product differentiation, customer retention, and foreign market access.

Annex IFootnote H: Best-in-Class Analysis (BiC)

I. Adoption of DfE Practices (% of firms)
  With Organization With Customers With Suppliers
Manufacturing 25% 15% 10%
Large–scale business 40% 15% 10%
Medium–scale business 35% 10% 5%
Small–scale business 15% 5%
Automotive 50% 10% 5%
Aerospace 50% 10% 5%
Industrial Electronics 45% 10% 5%
CPG 20% 15% 10%
II. Best-in-Class Business Benefits - % of BiC
  Automotive Aerospace Industrial Electronics
  Improved 1–19% Improved 20–50% Improved 1–19% Improved 20–50% Improved 1–19% Improved 20–50%
Product Differentiation 40% 40% 40% 40% 25% 75%
Successful Compliance 40% 40% 40% 40% 25% 75%
Customer Retention 40% 40% 40% 40% 25% 75%
Costs 40% 40% 60% 40% 75% 25%
Access to Foreign Markets 50% 50% 50% 50% 25% 75%
Increased Sales 60% 40% 60% 40% 50% 50%


Footnote 1

Best-in-Class (BiC) firms are defined as businesses who achieve positive results in two of the main environmentally specific activities: improved product environmental impact and energy efficient distribution practices.

Return to footnote A referrer

Footnote 2

CPG firms are companies that design, manufacture, and market apparel, food, cleaning products, hand and power tools, home furniture, housewares, sporting goods, linens, and consumer electronics and appliances.

Return to footnote B referrer

Footnote 3

Six Sigma Total Quality Management is a term used to indicate that a process is well controlled. This means, for example, that its tolerance limits are ±6 sigma (3.4 defects per million events) from the centre line in a control chart.

Return to footnote C referrer

Footnote 4

Private label products are manufactured by one company for offer under another company's brand. Private label goods are available in a wide range of industries from food to cosmetics.

Return to footnote D referrer

Footnote 5

One example is ENERGY STAR. ENERGY STAR–designated products must meet and/or exceed minimum Canadian federal energy efficiency standards in accordance with a prescribed performance level applicable for each product area.

Return to footnote E referrer

Footnote 6

See Industry Canada's "Green Supply Chain Management: A Retail Chain and Consumer Product Perspective"

Return to footnote F referrer

Footnote 7

Green supply chain management processes integrate environmentally friendly thinking into supply chain management (SCM). This includes implementing technical and innovative processes within material sourcing and selection, in the delivery of the final product to the consumers, and in end-of-life management.

Return to footnote G referrer

Footnote 8

Supply Chain & Logistics Association Canada: Green Survey, 2008
(—) = No result

Return to footnote H referrer

Permission to reproduce:

Non-commercial Reproduction
Except as otherwise specifically noted, the information in this publication may be reproduced, in part or in whole and by any means, without charge or further permission from Industry Canada, provided that due diligence is exercised in ensuring the accuracy of the information reproduced; that Industry Canada is identified as the source institution; and that the reproduction is not represented as an official version of the information reproduced, nor as having been made in affiliation with, or with the endorsement of Industry Canada.

Commercial Reproduction
For permission to reproduce the information in this publication for commercial purposes,
please contact the:

Web Services Centre
Industry Canada
C.D. Howe Building
235 Queen Street
Ottawa, Ontario Canada
K1A 0H5

Telephone (toll-free in Canada): 1-800-328-6189
Telephone (Ottawa): 613-954-5031
Fax: 613-954-2340
TTY (for hearing-impaired): 1-866-694-8389
Business hours: 8:30 a.m. to 5:00 p.m. (Eastern Time)


© Her Majesty the Queen in Right of Canada,
represented by the Minister of Industry, 2009

Cat. No.: Iu44-75/2009E
ISBN: 978-1-100-13680-6

Aussi offert en français sous le titre L'écoconception : Innover pour demeurer compétitif