The Science Based Targets initiative (SBTi) is a collaboration between CDP, the United Nations Global Compact, the World Resources Institute (WRI), and the World Wide Fund for Nature (WWF). It aims to drive corporate action on climate change by encouraging companies to set greenhouse gas emissions reduction targets in line with the latest climate science. By doing so, it ensures that companies’ operational and strategic plans are geared towards a low-carbon economy, helping to limit global warming to well-below 2°C above pre-industrial levels, and pursuing efforts to limit warming to 1.5°C. The initiative underscores the importance of private sector commitment in the global fight against climate change, offering a clear path towards sustainable and responsible business practices. 

In this blog, we will explore the Science Based Targets initiative in detail, providing a comprehensive understanding of how SBTi operates, its mission, and the significant role it plays in promoting sustainable development and corporate responsibility. Through an in-depth examination, readers will gain insight into the processes companies follow to commit, develop, and achieve science-based targets, along with the benefits and challenges they face. Our discussion will illuminate the importance of SBTi in steering the global business community towards a more sustainable and low-carbon future. 

Criteria for Target Setting 

Before delving into the inner workings of SBTi, it is essential to understand the criteria used in setting science-based targets. The initiative provides three types of targets for companies to choose from: well-below 2°C, 1.5°C, and net-zero targets. These targets are aligned with the goals of the Paris Agreement and require different levels of emission reductions to achieve. 

• Ambition: The targets set by companies must be ambitious enough to align with the latest climate science to limit global warming to well-below 2°C above pre-industrial levels, aiming towards 1.5°C. For example, a multinational corporation might commit to reducing its carbon emissions by 45% from 2010 levels by 2030, exceeding the minimum expectation for alignment with a 1.5°C pathway. 
• Consistency: Companies’ targets need to be consistent across all operational and strategic areas, ensuring that every aspect of their business is moving towards the set emissions reductions. For instance, if a retail chain commits to SBTi, it should include emissions reductions not only in its direct operations (Scope 1 and 2) but also across its value chain (Scope 3), such as product transportation, employee commuting, and waste generated in operations. 
• Integrity: The integrity of the target-setting process is crucial for achieving real and meaningful emissions reductions. This means avoiding reliance on carbon offsetting or other compensatory measures as a way to meet targets. For instance, instead of purchasing carbon credits to offset emissions, a company should focus on direct actions like switching to renewable energy sources, improving energy efficiency, and innovating low-carbon technologies. 
• Relevance: The targets must be relevant to the company’s significant environmental impact areas. For example, an automobile manufacturer with high Scope 3 emissions due to vehicle use should focus on developing electric vehicles and improving fuel efficiency to address its most impactful emissions source. This ensures that the company’s efforts are directed where they can make the most significant difference in combating climate change. 

A Step-By-Step Process 

The process of setting and achieving science-based targets through the Science Based Targets initiative (SBTi) involves a structured approach. By following these steps, companies can ensure their climate action plans are effective and aligned with global efforts to mitigate climate change. Here’s a detailed look at the step-by-step process: 

1. Commitment: The very first step for any company is to make a formal commitment to the Science Based Targets initiative. This commitment signals the company’s intention to set a science-based emission reduction target and starts its journey towards achieving significant environmental impact reductions. 
2. Develop Target: Once committed, the company needs to develop a specific emissions reduction target. Based on the SBTi criteria, this target should align with the current climate science and aim to limit global warming to well-below 2°C, striving towards 1.5°C. Companies should conduct a comprehensive greenhouse gas (GHG) emissions inventory to understand their baseline emissions and impact areas. 
3. Submit for Validation: After developing their target, companies must submit it to the SBTi for validation. The submission is reviewed by technical experts to ensure it meets all the necessary criteria and is scientifically aligned with limiting global warming. 
4. Communicate and Implement: After validating the target, companies should communicate their science-based target commitment and details publicly. Post-communication, the implementation phase kicks off, integrating the target into strategic planning, operational activities, and decision-making processes to meet the goals. 
5. Disclose and Update: Companies must disclose their emissions and progress towards their target to SBTi, ensuring transparency and accountability. Science-based targets need to be updated periodically to align with the latest climate science, technological advancements, and operational changes. 

Following this structured approach not only guides companies through the process of setting and achieving science-based targets but also ensures their contribution to the global effort in combating climate change is meaningful and impactful. 

Guidance and Resources for Businesses 

To support businesses in their journey towards sustainability, the Science Based Targets initiative (SBTi) offers a suite of tools designed to facilitate the target-setting process. These tools are intricately developed to guide companies through understanding their emissions profile, setting robust and scientifically-aligned targets, and tracking their progress. Key resources provided by SBTi include: 

• Target Setting Tool: A comprehensive spreadsheet model that helps companies calculate their science-based targets in alignment with SBTi criteria. This tool simplifies the complex calculations needed to set emissions reduction targets and is updated regularly to reflect the latest climate science. 
• Sectoral Decarbonization Approach (SDA): For certain sectors, the SDA provides a pathway to set science-based targets based on the sector’s share of the remaining global carbon budget. This tool is particularly useful for high-impact sectors like cement, steel, and electricity generation, offering detailed guidance on how to align with a 1.5°C future. 
• Scope 3 Evaluator: Recognizing the importance of addressing value chain emissions, the Scope 3 Evaluator tool assists companies in assessing their indirect emissions, which often constitute a significant portion of their carbon footprint. This tool guides businesses in identifying their most critical Scope 3 categories and developing strategies to reduce those emissions. 
• SBTi Finance Tool: Specifically designed for financial institutions, this tool enables banks, asset managers, and insurers to set science-based targets for their lending and investment portfolios, a critical step toward shifting financial flows to more sustainable activities. 

Success Stories  

Many companies worldwide have made significant strides towards sustainability by aligning with the Science Based Targets initiative (SBTi), demonstrating the tangible impact of committed climate action. Here are a few notable examples: 

• Tesla, Inc. has been at the forefront of integrating renewable energy solutions into its business model. By focusing on electric vehicles and clean energy production, Tesla has not only reduced its direct emissions but has also spurred innovation in the automotive industry towards electric mobility. 
• Unilever has made remarkable progress by committing to the SBTi. This global consumer goods company has aggressively pursued carbon-neutral goals across its operations and supply chain, significantly reducing greenhouse gas emissions. Unilever’s efforts extend beyond its operational boundaries, influencing its vast network of suppliers and customers towards sustainable practices. 

These companies, among others, exemplify the meaningful change that is possible when corporate strategies are aligned with science-based targets. Their achievements are a testament to the power of innovation, commitment, and strategic planning in driving global efforts towards a sustainable and low-carbon future. 

Conclusion 

The Science Based Targets initiative (SBTi) provides a structured, science-based approach for businesses to set and achieve ambitious emissions reduction targets. By aligning with the latest climate science, companies can make meaningful contributions towards mitigating climate change and creating a more sustainable future. With the guidance and resources provided by SBTi, businesses can embark on their sustainability journey with confidence, knowing that they are part of a larger collective effort towards a more sustainable and resilient planet.  

 

Sources: 

https://sciencebasedtargets.org/set-a-target 

https://cdn.cdp.net/cdp-production/comfy/cms/files/files/000/006/026/original/Corporate_Science-based_Target_Setting.pdf