Niklas Letmathe

2023

This paper addresses the pressing need to assess products' environmental and social impacts through a transparent and easily understandable scoring methodology called PLANEET (Product-level Assessment of Normalized Environmental and SociEtal ImpacTs). The study highlights the gaps and limitations in current systems such as ESG ratings and product-level rating systems. The findings from the literature reveal shortcomings in transparency, objectivity, and disclosure in existing systems, emphasizing the urgency to develop an effective scoring methodology. To address this gap, the paper explores Multi-Attribute Decision Making (MADM) models and evaluates their suitability for designing a product-level scoring methodology. The assessment considers criteria such as accessibility, objectivity, closeness, and consistency. Based on the analysis, a new MADM model named ARIA (Area-Based Rating of Independent Alternatives) is proposed, which integrates the integral area of sorted alternatives to derive scores per criterion. The model incorporates objective weighting approaches, with equity weighting as the default option. Furthermore, the study identifies and quantifies 26 relevant environmental and social impacts for product evaluation, including GHG emissions, air and soil pollution, deforestation, and diversity pay gap. These impacts are integrated into the PLANEET scoring methodology, which combines ARIA with environmental and social criteria. The research highlights the necessity of addressing current environmental and social events through comprehensive impact assessments. By developing PLANEET, the paper aims to provide consumers and companies with a tool that fosters awareness of the impacts associated with products. Given the urgency emphasized by the IPCC climate report, this scoring methodology contributes to the reduction of environmental and social impacts, paving the way for a sustainable future.