Science Based Targets is a joint initiative by CDP, UN Global Compact, WWF, and WRI that enables businesses to take swift climate action by setting ambitious emissions reduction targets.
The new normal: 1,000 companies are now setting science-based climate targets. In October 2020, 1,009 companies, spanning 60 countries and nearly 50 sectors, and with a combined market capitalisation of over $15.4 trillion USD — including one-fifth of the Global Fortune 500 — are working with the SBTi to reduce their emissions at the pace and scale necessary. The next step is to ensure that greenhouse gas (GHG) reduction targets are consistent with the pace recommended by climate scientists, to limit the worst impacts of climate change.
Targets adopted by companies to reduce greenhouse gas (GHG) emissions are considered “science-based” if they are in line with the level of decarbonization required to keep global temperature increase below 1.5°C, compared to preindustrial temperatures as described in the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC).
The Science Based Targets Initiative (SBTi) is calling on companies to demonstrate their leadership on climate action by publicly committing to science-based GHG reduction targets.
Companies set targets related to industry
SBTi lets companies choose from seven target setting methods. This flexibility allows companies to set targets that account for the reality of their industry – considering mitigation potential and how fast each sector can grow relative to economic and population growth. Within each sector, companies can derive their science-based emission reduction targets based on their relative contribution to the total sector activity and their carbon intensity relative to the sector’s intensity in the base year.
Over 500 companies have their Science Based Targets accepted by the SBTi with another 500 companies having submitted their targets to SBTi. Science-based target setting is already becoming part of the annual reporting practice of companies through incorporation in the CDP questionnaire and scoring.
Focus on emissions in Supply Chain
The SBT criteria have increased focus on Scope 3 emissions, with specific requirements for companies with 40% or more of their value chain emissions in Scope 3. Typically, the bulk of these emissions are related to the supply chain, thus engaging with their suppliers becomes key to having SBTs approved and reaching the targets.