Companies worldwide now adopt net zero commitments, yet many find it challenging to establish meaningful targets that arrange with climate science. The Science Based Targets initiative (SBTi) helps companies create credible carbon reduction plans through standardised emissions measurement and target setting. Setting science-based targets give organisations a clear, verified pathway to reduce greenhouse gas emissions that match the Paris Agreement's goals of keeping global greenhouse gas emissions below 1.5°C.
Science-based targets are commitments that align with the latest climate science, aiming to keep global temperature rise below 1.5°C, above pre-industrial levels. The SBTi represents a powerful partnership between CDP, the United Nations Global Compact, World Resources Institute (WRI), and the World Wide Fund for Nature (WWF). This collaborative effort creates standards, tools and guidance that help companies establish emissions reduction targets based on climate science. Companies from the private sector can take meaningful climate action through science-based target setting, which remains the initiative's main goal. SBTs help organisations arrange their operations within Earth's limits and meet societal sustainability goals through measurable and time-bound objectives. More than 5,000 companies have established climate targets through the SBTi since 2015.
The first step to setting SBTs is a complete data collection and analysis. A reliable foundation must be established before any commitment to specific reduction targets.
Gather Emissions Data: This typically entails gathering data on energy usage, transportation, waste management and other relevant areas that contribute to overall emissions.
Categorise the Emissions: Companies must complete a detailed greenhouse gas inventory that covers all relevant emissions sources. The inventory has company-wide scope 1 and 2 emissions data as defined by the GHG Protocol Corporate Standard. Companies need to get a full picture of all relevant categories in scope 3 emissions.
Select the Baseline Year: The base year selection cannot be made before 2015. The same base year must be used for both scope 1 and scope 2 targets.
Once a clear understanding of the current emissions has been established, the next step is to define both short- and long-term goals.
Short-term targets typically span 5 to 10 years and should be realistic yet ambitious enough to drive significant progress.
Long-term goals may extend to 2030 or beyond, aligning with broader climate commitments.
Establishing these timelines not only provides a roadmap for the organisation but also ensures that it remains accountable as progress is made towards their net zero goals.
The SBTi offers various methodologies to assist companies in setting their SBTs. It’s essential to review and select a target-setting method that aligns with the organisation’s specific circumstances. SBTi provides two main ways to set targets:
Absolute Contraction Approach (ACA): A straightforward method that helps companies reduce their total emissions in line with global decarbonisation pathways. Most companies prefer this approach, and data shows that two-thirds of approved targets in 2020 used ACA to achieve 1.5°C alignment.
Sectoral Decarbonisation Approach (SDA): A targeted method designed specifically for carbon-intensive sectors that uses industry-specific metrics based on each sector's decarbonisation rates.
The last step is to clearly communicate the targets and ensure validation from SBTi. Organisations should follow a well-laid-out process and ensure meaningful stakeholder participation throughout their net zero experience.
The SBTi validation process
SBTi's validation service will give a scientifically robust assessment of company targets. Here are the steps to validating SBTi targets:
Following the four steps above will help align a company’s net zero goals with SBTi requirements. Once the targets have been approved, companies should follow up by developing actionable initiatives aimed at achieving the objectives and tracking their progress.
This could include implementing energy efficiency measures, transitioning to renewable energy sources enhancing supply chain sustainability and investing in carbon offset projects. The emphasis should be on carbon emissions reduction across all operational areas. Creating a comprehensive action plan that details these strategies will facilitate smoother execution and engagement across the organisation.
Successful science-based target implementation relies on regular monitoring and transparent reporting. Organisations must show accountability through detailed annual progress reports to SBTi. Recent data reveals positive trends in corporate reporting compliance. 76% of companies with science-based targets share their progress publicly. 53% of companies reported complete progress on their near-term and long-term targets in 2022. 23% shared updates on at least one target.
Organisations need a reliable Measurement, Reporting and Verification (MRV) process that has:
According to SBTi, companies must share their company-wide GHG emissions inventory and target progress annually. These reports need detailed coverage of scopes 1 and 2 emissions. Scope 3 emissions must be reported when they make up more than 40% of total emissions. Companies should match their disclosures with CDP's corporate questionnaire requirements to ensure quality reporting. These details should line up with their SBTi-approved targets, including scopes covered, base year, target year and target values.
Tracking Global emissions bounced back in 2021 to levels similar to 2019. However, companies with SBTi-approved targets managed to keep their scope 1 and 2 emissions below their 2019 levels. This shows how science-based targets work in reducing emissions consistently, even during economic recovery periods. At Tunley Environmental, we understand the complexities of setting science-based targets and are here to assist you in your journey towards sustainability. Our carbon consultant service can help guide your organisation through the intricacies of foundations for science-based net-zero target setting in the corporate sector.