Carbon label, also known as carbon footprint label, is a product tag that quantifies and displays the total greenhouse gas emissions produced across the product's entire lifecycle, from raw material extraction and manufacturing to transportation, use, and disposal. It is kind of similar to nutrition facts on food packaging and material tags on garments, carbon labels tell consumers a product’s environmental impact.
Carbon labeling supports climate-conscious consumption and has been increasingly used by businesses to manage supply chain emissions, meet regulatory expectations, and differentiate in green markets.
Depending on the design, carbon labels can take following forms:
1.Carbon Certification Labels: indicate compliance with a low-emission standard but do not show emission numbers.
2. Carbon Footprint Scores: display specific numerical values of CO₂-equivalent emissions.
3. Carbon Performance Ratings: compare a product’s emissions to others in its category and rank it accordingly.

● Supply chain emissions transparency and supplier selection
● Green trade readiness (e.g. compliance with carbon tariffs)
● ESG benchmarking for investors and financial institutions
● Consumer education and climate-conscious marketing
● Preparing for Digital Product Passport (DPP) regulations

In Europe, carbon labeling and DPP (Digital Product Passport) framework are essential parts of the EU Green Deal. The DPP requires nearly all physical goods (excluding food, feed, and pharmaceuticals) sold in the EU to disclose material sources, composition, repairability, and recyclability data, aiming to improve traceability and build a more circular economy.