What is the SBTi?
In a world where businesses are making all manner of claims about their green credentials, it can be tough to know which climate commitments are genuinely meaningful.
Enter the Science Based Targets Initiative (SBTi), the go-to framework for businesses serious about aligning their carbon reduction efforts with the latest climate science.
What is the Science-Based Targets Initiative (SBTi)?
The SBTi is a framework that helps companies to set targets for reducing their greenhouse gas (GHG) emissions in line with what scientists say is necessary to keep global warming to 1.5°C, compared to pre-industrial levels. It’s about getting businesses to commit to the deep emission cuts that the planet needs.
A Brief History of the SBTi
The SBTi was launched in 2015, born out of a collaboration between four major environmental organizations: the Carbon Disclosure Project (CDP), the United Nations Global Compact, the World Resources Institute (WRI), and the World Wide Fund for Nature (WWF).
The timing was no coincidence—2015 was the year of the Paris Agreement, where countries across the globe committed to limit global warming. The SBTi was designed to help businesses align their goals with this international effort, translating high-level climate science into practical, actionable targets for companies across all sectors.
Since its inception, the SBTi has grown rapidly. What started as a framework for a handful of pioneering companies has now become the gold standard for emission reduction commitments, with thousands of businesses worldwide setting science-based targets.
How does a business set an SBTi-compliant Net Zero target?
Achieving compliance with the SBTi Corporate Net Zero Standard is a structured, rigorous process, ensuring that the business’s climate commitments are both rigorous and credible. Here’s a breakdown of how to comply with the standard.
1. Measure a Full Scope Footprint
As the saying goes, what gets measured gets managed – and if you’re going to commit to a target for reducing your emissions, you need to know what you’re emitting now.
So the first step in the process is to measure your company’s full greenhouse gas (GHG) footprint, covering Scope 1, Scope 2, and Scope 3 emissions, in line with the GHG Protocol. This forms your ‘base year’ – the yardstick against which you target a % reduction, and against which progress is measured annually.
For most businesses, Scope 3 emissions can be particularly significant, as they involve upstream activities (like supplier emissions) and downstream activities (like product use and disposal by customers). Measuring these emissions can be complex, especially for smaller businesses, but it’s an essential element of the process.
2. Set Near-Term and Long-Term Targets
Once your base year has year measured, the next step is to set both near-term and long-term emission reduction targets – commitments to reduce your emissions by a certain percentage, and a certain date, against your base year. In both cases, the SBTi sets a minimum requirement for the level of ambition required.
- Near-Term Target: These are targets for the next 5 to 10 years and are aggressive enough to ensure meaningful reductions in emissions in the short term. For corporations, near-term targets must cover at least 95% of Scope 1 and Scope 2 emissions. For Scope 3, the targets must cover at least 67% of the total Scope 3 emissions. For SMEs (as defined by the SBTi as companies with fewer than 500 employees), there is more flexibility. SMEs are encouraged to set targets that cover the majority of their emissions but may have simplified requirements for Scope 3, reflecting the challenges smaller companies face in managing these emissions. You can use the SBTi’s Near-Term tool to understand the % reduction required against your base year.
- Long-Term or Net Zero Target: These targets align with achieving Net Zero emissions by 2050 at the latest. For both corporations and SMEs, these targets must address all relevant Scope 1, 2, and 3 emissions, aiming for at least a 90% absolute reduction in GHG emissions by the target date. The idea is to ensure that the company’s emissions are reduced to near-zero levels, with any remaining emissions balanced out through carbon removal efforts, such as reforestation or carbon capture technologies. You can use the SBTi’s Net Zero tool to understand the requirements for this target.
3. Publish the Commitment
After setting these targets, businesses must publicly commit to their SBTi-aligned goals. This involves publishing your targets in a set format that clearly outlines your reduction commitments, the timeline for achieving them, and the specific scopes of emissions included. This transparency is key to ensuring accountability and demonstrating your company’s dedication to meeting its climate goals.
4. (Optional) Submit Targets for Review
While publishing your targets is a critical step, the SBTi also offers an optional service where businesses can submit their targets for an official review. This review process, which involves a fee, ensures that your targets are fully aligned with the SBTi’s stringent criteria and provides an additional layer of credibility to your commitments.
During this review, SBTi experts will assess whether your targets meet the necessary benchmarks for ambition, coverage, and timeline, offering feedback and potentially requiring adjustments before giving their stamp of approval. For many businesses, especially those looking to signal their climate leadership, this official validation can be a valuable endorsement.
Why should you set an SBTi-aligned Net Zero target?
Complying with the SBTi means setting a rigorous, ambitious emission reduction target in line with the latest climate science – which adds credibility to your climate comms. Here are a few specific benefits of the standard:
1. Focus on Emission Reduction Over Offsetting:
While there is a role for carbon offsetting, the SBTi emphasizes actual emission reductions first and foremost. The idea is to cut emissions directly rather than relying solely on offsetting, which can be a bit like sweeping the dirt under the rug. By focusing on real reductions, businesses contribute more meaningfully to global climate goals.
2. Science-Based Targets:
The SBTi’s targets are not arbitrary. They are rooted in climate science and based on the best available data on what is needed to limit global warming. This gives businesses confidence that their actions are aligned with the latest scientific understanding and that they are genuinely contributing to solving the climate crisis.
3. Long-Term Commitment:
The SBTi is not about quick fixes. By requiring both near-term and long-term targets, it encourages businesses to make deep, sustained changes over time. This long-term focus helps ensure that companies are not just making token efforts, but are genuinely committed to transforming their operations.
4. Simplicity and Clarity:
While the SBTi’s standards are rigorous, they are also designed to be accessible. The framework provides clear guidelines, making it relatively straightforward for businesses to understand what is required and how to achieve it.
What are the drawbacks of the SBTi?
Like any initiative, the SBTi has its challenges.
1. No Intensity Targets:
For many businesses, especially fast-growing startups, the limited ability to set "intensity" targets (like emissions per employee, or revenue) is a sticking point. In rapidly scaling businesses, absolute emissions are very likely to increase even if the company becomes much more carbon efficient, and takes market share from more carbon-intensive competitors. Yes, in this scenario, the business's overall emissions are going up, but the expansion of their carbon-reduced business model is helping to decarbonise the economy as a whole - which, after all, is the real aim. The SBTi’s focus on absolute emissions reductions can feel unfair or unrealistic in these cases, making it harder for such businesses to participate.
2. Inclusion of All Scope 3 Emissions:
Scope 3 emissions are often the largest part of a company’s carbon footprint, but they’re also the hardest to control. For small businesses, influencing the emissions of larger suppliers or customers can be daunting, if not impossible. The requirement to include these emissions has led to criticism that the SBTi may set the bar too high for smaller players, potentially discouraging participation.
3. Controversy Over Offsetting Rules:
The SBTi is currently considering changes to its rules around carbon offsetting, allowing more room for companies to achieve Net Zero by investing in offsetting projects. Some worry that allowing more prominence for offsetting could weaken the initiative’s focus on direct emissions reductions, potentially letting companies buy their way to Net Zero rather than making the necessary systemic changes. This remains a live debate, both within the SBTi and within the wider sustainability world.
The Future of the SBTi
Looking ahead, the SBTi is likely to see even broader adoption as more businesses recognize the importance of aligning their climate goals with science. However, we may also see some changes to the standard as the SBTi responds to feedback and evolving scientific understanding. The potential shift in its offsetting rules is one example of how the initiative might adapt to balance rigor with practicality.
Overall, the SBTi is set to remain a key player in corporate climate action, helping businesses of all sizes contribute to the global effort to combat climate change. While there are challenges and criticisms, the initiative’s emphasis on science-based, long-term targets ensures that it continues to push companies towards meaningful, impactful change.
Syllabus
Climate change: the basics
Carbon footprinting
Tackling emissions
The road to Net Zero
What is carbon offsetting?
Climate comms
Chat to an expert
Measure a full-scope footprint, reduce emissions, and share your Net Zero strategy.