How HEDSL Helps Streamline Chemical Substance Reporting

In recent years, chemical management regulations have grown in number and complexity, impacting everyday products from clothing and footwear to tractors and excavators. In many instances, the only way a manufacturer can sell its products into certain markets is to uncover the chemical composition of each part and component found in their product. Given that more than 15,000 chemicals are regulated globally, and that an individual company’s supply chain may encompass 20-plus layers of the supply chain, regulatory compliance is becoming an increasingly burdensome task for manufacturers today. 

To help streamline this intensive data-collection effort, AEM helped lead the creation of the newly published Heavy Equipment Declarable Substance List (HEDSL). The HEDSL contains a list of chemicals of concern that affects heavy equipment, which can help reduce the burden on manufacturers and their suppliers by focusing the off-road equipment industry’s efforts on specific parts and components and the high-risk chemicals contained therein. HEDSL will not only make it easier for companies to maintain their chemical regulatory compliance, but it will also reduce the resources and cost associated with disclosing this type of information.  

Chuck LePard, a senior consultant for AEM member company DXC Technology and Americas Representative for the International Material Data System (IMDS) & Compliance Data Exchange (CDX), an online product data management system, co-presented an AEM Member Education Webinar on this topic on Dec. 12. LePard, who is also Vice Chair of AEM’s HEDSL Committee, was joined by John Merx, compliance manager at AEM member company The Manitowoc Company. 

Regulatory chemical compliance first emerged in Europe more than 30 years ago after research discovered that a rise in miscarriages and birth defects was tied to heavy metal poisoning. The auto industry was targeted first with a new type of regulation, known as the End of Life Vehicle (ELV) Regulation in 2000. Roughly five years later, the scope of this regulation extended to electronics and industrial products. 

In 2006, the European Union created additional rules known as the Restriction of Hazardous Substances (RoHS) and Waste Electrical & Electronic Equipment (WEEE). “At this point, it became very difficult to sell just about any type of product in Europe without understanding its chemical composition,” LePard said. 

Similar regulatory activity soon emerged in the U.S. and elsewhere. According to LePard, the number of regulations and jurisdictions with regulations has increased dramatically over the past several years. 

“The regulations are no longer just general regulations on a few chemicals,” LePard pointed out. “Now it’s very specific as to which chemicals can be allowed and which are prohibited. We’ve particularly seen some active legislation in the U.S. regarding revisions to the Toxic Substance Control Act.” Other examples include California Proposition 65, under revision again in 2024, and PFAS reporting rules in the U.S. “These types of changes are taking place in virtually every jurisdiction globally,” LePard said. 

When LePard started monitoring these types of regulations 20 years ago, there were around 700 different chemicals being regulated, primarily in Europe. “Today we’re looking at more than 15,000 different chemicals in various jurisdictions,” LePard said. “Europe is still one of the leading jurisdictions. But everyone has gotten involved, especially in the water pollution area in Asia and the soil pollution area in Europe. Regulators are also recognizing that these are concerns that project out into the new world in places like Africa and South America.” 

Visit AEM's Heavy Equipment Declarable Substance List (HEDSL) Resource Page for the latest version of the list, along with other informative documentation regarding HEDSL, Full Material Disclosure, and related topics 

“For some companies, FMD involves identifying pseudo substances,” Merx added. “It’s identifying if something is chemically or physically separable. It’s the total weight of the product, not just the weight of the chemicals. You can’t compare numbers if you don’t have both. This also includes having the correct country of origin as to where you sourced your materials from.” 

According to Merx, having this information readily available through an FMD approach can help a supplier reduce the number of chemical compliance requests it receives. It can also help reduce the time spent on conflict metals, creating a carbon footprint, creating ship recycling declarations, and working to comply with RoHS, China CCC, India tax agency declarations, and so on.  

For legacy products, Merx said manufacturers should be able to submit all their FMD requests to their supply chains at once. It does take time, often up to three years, to collect all of the necessary data. “If you haven’t already done so, a great time to start is right now,” Merx advised. 

For new parts, Merx suggested incorporating an FMD approach into the product acceptance or PPAP (Production Part Approval Process) program. 

Merx and LePard concurred that motivating some suppliers to provide FMDs can be a bit of an uphill battle. However, highlighting one important point can reverse a lot of that headwind. 

Suppliers can generally maintain their trade secrets while still providing an FMD. Intellectual property is widely considered to be up to 10% of the weight of the article on the non-declarable substances. So long as that 10% doesn’t include substances that need to be disclosed, that intellectual property can be kept secret. Given that, taking the time to create FMDs has a lot of upsides for a supplier. 

“The more you can be transparent with your downstream supply chain, the fewer requests you’ll have to contend with,” Merx said. 

“We want suppliers to protect their intellectual property,” LePard added. “But at the same time, we want to ensure that (heavy equipment) containing their products are compliant with regulations and won’t end up causing problems for all of us in any given jurisdiction.” 

“The goal is to create a transparent pathway from material formulator all the way to the end use, which will help reduce the cost associated with having to answer compliance questions. It’s helpful to have that data readily at your fingertips so you can efficiently communicate with your customers. Ultimately, a supplier wants more control and less uncertainty. (Full Material Disclosure) FMD is a way to get there.” -- The Manitowoc Company's John Merx

AEM’s HEDSL Committee has been working for more than a decade to scour regulations from around the world to determine which regulated substances impact the products AEM members manufacture. That’s where a significant amount of HEDSL’s value lies. 

“If we can’t sell in Europe, Asia, or the Middle East, that’s going to have an impact on our business,” LePard said. “Even here in the U.S., the state of California is particularly strict, as are states like Maine, Minnesota, New York, and others where people live where they grow their food.” 

HEDSL eliminates the guesswork for manufacturers and their suppliers, while also eliminating the burden of each individual company having to assemble its own list of regulated chemicals. “We’ve essentially tried to take the strictest regulation and use that as the guidance for what the substance declaration needs to include,” LePard said. 

Some suppliers may question that logic, especially those that are only selling their products to manufacturers in the U.S. But as LePard explained, if any of those U.S. manufacturers turn around and sell their products into other countries, big problems could arise if certain parts or components aren’t compliant with that jurisdiction’s regulations. 

“You’re no longer a viable supplier at that point,” LePard said. “And when another supplier can do this for your customer without additional cost and effort, that’s the supplier that’s going to be selected.” 

There are several service providers that offer product compliance solutions to assist manufacturers. Merx said he’s aware of at least five who have already incorporated HEDSL into their solutions. That’s something companies in the heavy equipment industry should consider moving forward. HEDSL is a powerful tool that will help harmonize and simplify the industry’s data collection efforts — but only when stakeholders throughout the supply chain use it.