What is SBTi?
A Quick Guide to Emissions Targets
During the global climate crisis, the business sector plays a crucial role in reducing greenhouse gas (GHG) emissions. One approach increasingly adopted by major companies worldwide is setting emissions targets aligned with climate science through an initiative known as the Science Based Targets initiative (SBTi).
What is SBTi?
SBTi is an initiative that encourages companies and financial institutions to set GHG emissions reduction targets based on scientific evidence. It is a climate action organization formed through a collaboration between CDP, the United Nations Global Compact (UNGC), the World Resources Institute (WRI), and WWF. Its goal is to drive private sector action to reduce emissions in line with the global temperature limits set in the Paris Agreement, keeping global warming well below 2°C and ideally limited to 1.5°C.
Simply put, SBTi helps companies to:
- Set science-based emissions reduction targets.
- Validate whether those targets are ambitious enough.
- Provide guidance and methodologies aligned with international standards.
Why is it Important?
Adopting the Science Based Targets initiative (SBTi) means a company is not just making symbolic commitments to climate issues, but is taking concrete, accountable actions to limit global warming to below 1.5°C, in accordance with global climate science. This is important for several reasons:
SBTi is a widely recognized international standard. Aligning corporate climate goals with science boosts stakeholder trust, including investors, partners, and customers, and strengthens market competitiveness. According to sciencebasedtargets.org, over 4,000 global companies have committed to SBTi in response to growing market demand for real climate action.
Implementing SBTi targets encourages companies to reassess their operations systematically to reduce emissions. It also promotes investment in low carbon technologies and energy efficiency often leading to cost savings.
SBTi Requires Companies to Set Three Types of Targets
To achieve net zero emissions at the corporate level, companies must reduce emissions in line with set targets. The SBTi targets include:
Illustrative chart showing stepwise emission reduction targets (source: sciencebasedtargets.org)
1. Near-Term Targets:
These targets aim for emissions reduction over a 5–10 year period, focusing on absolute or intensity-based reductions in Scope 1, 2, and 3 emissions. Near-term targets are aligned with the 1.5°C pathway by 2030 and drive immediate climate action.
2. Long-Term Targets:
These are set with a horizon of up to 2050 and aim to reduce emissions by at least 90–95% before addressing the remaining balance. They guide companies on the level of emissions reduction required across their value chain to align with global net zero goals under the 1.5°C pathway by 2050.
3. Neutralizing Residual Emissions:
Although most companies are expected to reduce at least 90% of emissions through long-term targets, not all will achieve full decarbonization. As a result, some residual emissions may remain and must be neutralized for the company to reach true net zero status with no climate impact. This requires companies to permanently remove carbon from the atmosphere and store it to offset these remaining emissions.
Steps Toward SBTi Commitment
- Commitment: Register with SBTi and publicly declare your intent to set targets.
- Target Submission: Develop and submit your emissions reduction targets.
- Validation: SBTi reviews and validates the targets for alignment with science.
- Public Disclosure: Once approved, targets are made public.
- Implementation & Reporting: Companies execute the action plan and report progress regularly.
Common Challenges Faced by Companies
Based on our experience, companies often face several challenges when implementing SBTi, such as:
- Limited internal understanding of SBTi principles
- Inadequate and incomplete emissions data, especially for Scope 3
- Identifying gaps between company practices and SBTi requirements
- Developing and validating targets in compliance with SBTi
- Preparing necessary technical documentation
Why Choose ACTIA?
Prepare your company for SBTi implementation with our professional team. Why partner with us?
We have deep expertise in international standards, including TCFD, GRI, CSRD/ESRS, IPCC, GHG Protocol, and SBTi.
We are experienced in corporate emissions calculations for Scope 1, 2, and 3, aligned with the GHG Protocol and ISO 14064.
Using a data driven approach, we assist in formulating SBTi targets from submission to validation and public disclosure.
We deliver professional reporting supported by effective communication, strong collaboration, and a commitment to quality and timely completion.
SBTi is not just a reporting tool, it is a strategic compass for building climate resilient businesses. By adopting this approach, companies not only meet market and regulatory demands but also make a tangible contribution to a more sustainable future.
Ready to set SBTi targets for your company?
If you need further guidance, we’re here to help! Contact us for a free initial consultation and discover how SBTi can give your business a competitive edge.
