| All products and services have an environmental impact originating from one or all stages of their life cycle, whether during the extraction of the raw materials, design, manufacture, assembly, marketing, distribution, sale, use or final disposal as waste. Higher levels of income and smaller household size are causing the consumption of products and services to reach unsustainable levels threatening the exhaustion of natural resources. The Worldwatch Institute’s annual report ‘State of the World 2004’ states that we are currently consuming goods and services at an unsustainable pace, with serious consequences for the well-being of people and the planet. The sustainable development of our societies is one of the priorities of the European Commission (EC). Through it’s new Integrated Product Policy (IPP) the EC is developing measures that influence the supply and demand of environmentally sound products. The main objectives of IPP are: Minimisation of environmental impacts of products and services 'from cradle to grave' by considering their entire life cycle and targeting the areas where action will be most beneficial for both the environment and business.Integration of environmental policies to ensure that the benefits of reaching an environmental goal are balanced against any resulting environmental costs elsewhere in the life cycle.Close co-operation with all stakeholders in and around the supply chain from product designers and manufacturers to retailers and consumers, to maximise the effectiveness of environmental impact reduction.Development of ‘green markets’ for product and services by introducing a range of instruments and incentives for producers on the supply side to encourage product innovation, and information tools for consumers on the demand side to encourage them to buy more environmentally sound (‘green’) alternatives.See IPP Tools and Principles and Building Blocks of IPP.
IPP represents a shift in focus to reducing the environmental impacts of products and services, not just processes. Environmental strategies orientated towards processes and cleaner technologies have enabled industry to reduce the impacts of its activities, and most environmental regulations still target industrial processes. However as consumers increasingly become contributors to environmental impacts, this effort must be increased and focused directly on the origin of the problem, i.e. the products and services themselves. IPP is an integrated, business orientated approach that combines market and environmental tools. It is flexible, allowing different industrial sectors to use a range of instruments and incentives adapted to the characteristics of their supply chain and consumers. These instruments and incentives can be voluntary or mandatory and work at local, national and EU levels and include, for example, economic instruments, substance bans and eco-labelling schemes. IPP is a complementary strategy for use alongside existing policy instruments to address the policy gap where the environmental impacts linked to product use have not received sufficient attention. The EC published a Green Paper on IPP in February 2001 and a Communication in June 2003. | 
