Navigating the Science Based Targets initiative (SBTi)

In the race against climate change, businesses are under increasing pressure to adopt sustainable practices. A growing number of companies are turning to the Science Based Targets initiative (SBTi) to help them set and achieve credible climate goals. 

This feature explores what SBTi is, why it matters, and how businesses can successfully navigate its framework to make meaningful progress toward reducing their carbon footprint and contributing to global sustainability.

Understanding SBTi: What Is It?

The Science Based Targets initiative (SBTi) is a global organisation that provides businesses with a framework to set ambitious and achievable greenhouse gas (GHG) emissions reduction targets. 

These targets are “science-based” in that they align with what the latest climate science deems necessary to meet the goals of the Paris Agreement – limiting global warming to well below 2°C above pre-industrial levels and pursuing efforts to limit warming to 1.5°C.

Launched in 2015, the SBTi is a collaboration between CDP (formerly the Carbon Disclosure Project), the United Nations Global Compact, the World Resources Institute (WRI), and the World Wide Fund for Nature (WWF). 

It aims to mobilise the private sector to take the lead in reducing emissions and ensuring that the transition to a low-carbon economy happens swiftly and effectively.

The Importance of SBTi for Businesses

With the intensifying focus on sustainability from consumers, investors, and regulators, businesses face significant pressure to demonstrate their commitment to environmental stewardship. 

Adopting science-based targets offers several key benefits:

Credibility and Trust: Setting targets through the SBTi lends credibility to a company’s sustainability claims. It signals to stakeholders that the business is committed to meaningful and measurable action, not just greenwashing.

Competitive Advantage: Companies that set and achieve science-based targets often gain a competitive edge. Consumers and investors are increasingly favouring businesses that are proactively addressing climate risks.

Future-Proofing: As regulations around carbon emissions tighten, companies with science-based targets are better positioned to comply with future regulations. This proactive approach can save costs and reduce risks associated with non-compliance.

Stakeholder Engagement: SBTi encourages transparency and accountability, which helps build stronger relationships with stakeholders, including customers, employees, and investors.

How to Successfully Navigate SBTi

Successfully navigating SBTi can be a complex process, but it’s crucial for businesses aiming to make a genuine impact on climate change. Here’s a step-by-step guide to help companies through the process:

1. Understand Your Emissions Profile

The first step in setting science-based targets is to gain a clear understanding of your company’s current emissions profile. This involves:

Scope 1 Emissions: Direct emissions from owned or controlled sources, such as company vehicles or on-site energy production.

Scope 2 Emissions: Indirect emissions from the generation of purchased electricity, steam, heating, and cooling.

Scope 3 Emissions: All other indirect emissions that occur in a company’s value chain, such as those from suppliers, product use, and waste disposal.

For many businesses, Scope 3 emissions are the largest and most complex to measure. However, understanding these emissions is crucial, as SBTi requires companies to include Scope 3 targets if they represent more than 40% of the company’s total emissions.

2. Set Ambitious Yet Achievable Targets

Once you have a clear picture of your emissions, the next step is to set targets that are in line with the level of decarbonisation required to meet the Paris Agreement’s goals. SBTi provides different target-setting methods based on industry, business size, and specific circumstances. These include:

Absolute Emissions Reduction: This method requires companies to reduce their absolute emissions in line with science-based trajectories.

Economic Intensity Targets: These targets relate emissions reductions to economic activity, such as emissions per unit of GDP or per unit of revenue.

Sectoral Decarbonisation Approach (SDA): This method allows companies in certain sectors to set targets that reflect the specific decarbonisation pathways for their industries.

It’s important to note that SBTi encourages setting targets that align with the 1.5°C ambition, the most ambitious goal of the Paris Agreement. Companies should strive to exceed the minimum requirements to demonstrate leadership in climate action.

3. Obtain SBTi Validation

After setting your targets, the next step is to submit them for validation by the SBTi. This process involves a thorough review to ensure that the targets meet the initiative’s rigorous criteria. 

The validation process typically takes a few weeks and may involve some back-and-forth to clarify or adjust the targets.

Successful validation results in formal recognition by SBTi, which can be a powerful tool for demonstrating your company’s commitment to climate action. It also allows you to use the SBTi logo and branding in your sustainability communications.

4. Develop and Implement a Strategy

With validated targets in hand, the focus shifts to implementation. This involves developing a detailed strategy to achieve your targets. Key considerations include:

Energy Efficiency: Reducing energy use through efficiency measures is often the most cost-effective way to cut emissions. This could involve upgrading equipment, optimising processes, or retrofitting buildings.

Renewable Energy: Transitioning to renewable energy sources, such as solar or wind power, is essential for reducing Scope 2 emissions.

Supply Chain Engagement: For Scope 3 emissions, companies may need to work closely with suppliers to encourage or mandate emissions reductions. This could involve setting supplier standards, offering training, or providing incentives.

Innovation and Technology: Investing in new technologies and business models can also drive emissions reductions. This could include adopting electric vehicles, developing low-carbon products, or exploring carbon capture and storage (CCS) solutions.

5. Monitor, Report, and Adjust

Achieving science-based targets is not a one-time effort but an ongoing process. Companies need to regularly monitor their progress and report on their emissions reductions. Transparency is key, and businesses should be prepared to share both successes and challenges with stakeholders.

It’s also important to remain flexible. As climate science evolves and new technologies emerge, companies may need to adjust their strategies and targets to stay aligned with the latest best practices.

Conclusion: Leading the Way to a Sustainable Future

Navigating the SBTi can be a challenging journey, but it’s one that more and more businesses are undertaking as they recognise the importance of climate action. 

By setting and achieving science-based targets, companies can not only contribute to the global effort to combat climate change but also secure long-term success in a rapidly changing world.