Methodology

The following sections explain the methodological foundations behind Nios impact measurements.

How impact calculation works

The Nios system applies a two-step calculation process:

1. Midpoint environmental impact measurement

Each material in your BoM is analyzed to calculate its environmental footprint:

• The Nios agent maps each BoM material to a relevant reference material impact intensity factor from our environmental intensity factor databases.
• The material spend value is multiplied by the intensity factor to calculate environmental impacts in a standardized and comparable way.
• The Nios agent evaluates how closely the reference material matches your BoM entry, providing transparency in the BoM tables on underlying assumptions.
• The system calculates midpoint environmental impacts, including GHG emissions, land use, water use, and pollution.

2. Biodiversity translation

Midpoint environmental impacts are characterized into a single endpoint biodiversity impact metric:

• GHG emissions, land use, water use, and pollution are converted into PDF·yr (Potentially Disappeared Fraction of species over time).
• Each environmental impact is multiplied by region- and impact-specific characterization factors from the LC-Impact methodology.
• These factors capture how strongly each pressure affects biodiversity in different locations, making results spatially explicit.

Key notes on analysis scope

Value chain stage coverage

The assessment scope covers upstream value chain stages, resulting in cradle-to-gate system boundaries from raw material extraction through end-product manufacturing.

For the lowest available value chain stage, Nios applies cradle-to-gate intensity factors, which capture all upstream value chain impacts (analogous to upstream Scope 3 in GHG accounting).

For all higher-level stages, Nios applies gate-to-gate intensity factors, which include only direct, stage-specific impacts (analogous to Scope 1 in GHG accounting).

This approach ensures that upstream impacts are fully accounted for at the most disaggregated stage while avoiding double counting across higher-level stages. Downstream stages such as product use and end-of-life are not yet included.

Impact group coverage

Nios has chosen impact groups based on their relevance to known regulations, standards, and science-based frameworks such as the Planetary Boundaries and IPBES.

Scientific frameworks and data

Nios calculations are based on the following scientific frameworks and datasets:

Note on alignment with global standards

In nature footprinting and broader supply chain impact assessment, global standards are still evolving. At this stage, Nios is not formally certified under any single standard.

Our methodology is therefore designed to align closely with the shared core principles of leading frameworks and scientific approaches, and is continuously refined as standards, regulatory guidance, and scientific understanding mature

• Mimics core principles of life cycle assessment (LCA) to ensure scientific grounding and transparency.
• Prioritizes pragmatism by providing actionable insights for decision-makers today rather than waiting for perfect standardization.
• Covers environmental impacts holistically (not only GHGs), in line with the broader framing of the Planetary Boundaries Framework and IPBES drivers of nature loss.

We monitor the development of key frameworks such as CSRD ESRS, TNFD, SBTN, EU PEF, ISO, and the GHG Protocol. We aim for conceptual consistency with these standards where possible and may revisit our stance as alignment between standards matures.

Our methodological choices already overlap with the recommendations of these frameworks:

• Environmentally-extended input-output tables (EEMRIOs) are repeatedly referenced in the TNFD LEAP methodology (e.g., pages 44, 84, 89, 236, 237) as a way to model value chain impacts when company-specific data is unavailable.
• The TNFD biodiversity footprinting discussion paper explicitly refers to LC-Impact (pages 25, 42, 48).

Limitations and future work

• Exclusions: Current scope does not yet include various other impact groups and categories such as ecotoxicity, invasive species, ocean acidification, or marine biodiversity impacts.
• Ecosystem weighting: Current results aggregate impacts across terrestrial, freshwater, and marine ecosystems without applying explicit weighting between ecosystem types. This reflects the methodology used in the Kulionis et al. (2024) research paper research paper, which Nios follows for calculating PDF-based metrics. The question of how different ecosystems should be weighted is still evolving in the scientific and policy community, and we continue to monitor developments and may introduce ecosystem-specific views or alternative weighting approaches as methodologies mature.
• Averaging: Sector-based models assume uniform technologies and sectoral-level system boundaries, which may under- or over-estimate company/product-level results. The resulting values should therefore be interpreted as directional approximations rather than precise footprints. Where available, primary data or activity/process-level LCAs can provide more granular and company-specific results.
• Inventory data: We will expand support for mass- and quantity-based inventory data (e.g., process-level inputs, flow quantities, and detailed impact intensity factors). Current results rely primarily on spend- or sector-based intensity factors, and future updates will improve granularity and precision.
• Chat agent limitations: Nios AI agents are non-deterministic and rely on probabilistic reasoning. While designed to act as specialists in matching and analyzing data, results may vary between runs and occasional mismatches can occur. Outputs are structured approximations meant to support (not replace) expert review.