Science Based Targets initiative scales up, heightens focus on Scope 3 emissions

The number of companies with greenhouse gas emissions reductions commitments validated by the Science Based Targets initiative doubled in 2023 to 4,204 companies. As it seeks to maintain or accelerate that pace of adoption, the organization is separating this year into two units — a standards-setting body and a target validation team.

SBTi is encouraging companies to heighten their focus on emissions reductions across Scope 3, which describes emissions contributed by corporate supply chains and other activities not in a company’s direct control. 

The goal is to approve the pledges of 10,000 companies by the end of 2025, and 2,000 more companies already are committed to the process, said SBTi CEO Luiz Amaral. 

“The battle on climate change is going to be won or lost in the supply chain,” Amaral said. “The more people that are in, the easier it gets for everyone.” 

Closer scrutiny

SBTi was created by several well-known environmental nonprofits in 2014 to help companies set voluntary “science-based targets” that align their absolute greenhouse gas emissions reductions with the Paris Agreement. The current guidance requires companies to set targets that limit global temperature increases to 1.5 degrees Celsius.

The organization’s popularity among corporations aiming for net zero by 2050 has drawn closer scrutiny of its requirements, especially after long-time supporter Amazon acknowledged in August it would be unable to meet its deadline for submitting targets. Other companies, including Intel, have chosen not to participate because of SBTi’s policy of not recognizing “avoided emissions” that some companies calculate based on their past emissions reduction measures. 

SBTi appointed an independent Technical Council last fall composed of academic institutions, NGOs and other standards bodies to review the science-based target requirements for the near term (this decade) and long term (those pegged to the 2050 vision). The group will review future changes “to further enhance technical integrity and adherence to established standard-setting procedures.” 

Here’s what else is in store this year: 

• A review of the corporate net-zero standard, with an eye to potential revisions during 2025.
• More work on standards for financial institutions, including a net-zero standard.
• The formation of an independent Validation Council to strengthen the credibility of that process. “The Technical Council is charged with making tough calls, and this will be the same,” Amaral said. 
• Closer partnerships with other standards-setting organizations to improve integration with other frameworks, notably those for developing strategies for nature and biodiversity.
• The appointment of compliance and quality managers for the validation process.
• A commitment to shorter validation approval times; according to SBTi, average waiting times were cut in half in 2023.
• The development of sector-specific standards for oil and gas, electric utilities, automotive, chemicals, insurance and apparel. (Guidance already exists for industries including information technology, steel and cement.)

SBTi’s principal funding sources over the past three years have been the Bezos Earth and IKEA Foundation, which both contributed $18 million in November 2021, paid out over several years. SBTI will continue to be funded by philanthropy and validation fees, Amaral said.