The Science Based Targets initiative (SBTi) has emerged as a critical framework for driving corporate action on climate change. By helping companies establish clear, science-backed pathways to reduce greenhouse gas (GHG) emissions, SBTi ensures that business strategies align with the global effort to limit warming to 1.5°C, as outlined in the Paris Agreement.
As climate challenges intensify, the need for businesses to adopt and meet measurable, actionable science-based targets has never been greater. These targets not only enable companies to achieve meaningful GHG reductions but also strengthen their resilience in a rapidly evolving regulatory and market landscape.
Beyond emissions, SBTi plays a vital role within the broader ESG (Environmental, Social, and Governance) landscape. It ensures that climate action is integrated into corporate responsibility, transparency, and long-term value creation.
Read on for our guide on SBTi target setting and SBTi’s role in greenhouse gas emissions reduction.
What are Science Based Targets?
Science-based targets are corporate climate goals grounded in scientific research and tailored to the individual circumstances of the companies that set them. They are designed to ensure that companies contribute meaningfully to limiting the global temperature rise to 1.5°C, as outlined in the Paris Agreement.
Unlike simple emission reduction targets, science-based targets are rooted in rigorous defined methodologies that align business emission reduction efforts with the level of decarbonization actually required to avoid the worst impacts of climate change.
The Science Based Targets initiative provides a robust framework and validation process to help companies set and achieve their targets. By adhering to SBTi guidance, businesses can create actionable roadmaps for reducing greenhouse gas (GHG) emissions across Scope 1, 2, and 3 categories.
How to set science-based targets
Setting science-based targets is a lengthy, structured process designed to help companies align their climate goals with the latest climate science. Here’s an overview of the process:
- Commitment letter submission: Companies begin by submitting a letter to the SBTi, signaling their commitment to setting a science-based target. This step demonstrates their intention to align with global climate goals and marks the start of the journey.
- Target development using SBTi resources: Businesses then work on developing their targets using the guidance and resources provided by SBTi. This includes determining the appropriate reduction pathways and boundaries for their specific industry and emissions profile.
- Target validation by SBTi: Once developed, targets are submitted for validation by SBTi to ensure they meet the initiative’s rigorous criteria. This step ensures the targets are ambitious, credible, and aligned with the Paris Agreement’s 1.5°C trajectory.
- Implementation and progress tracking: After validation, companies integrate these targets into their operations and monitor progress over time. Regular reporting ensures accountability and highlights areas for improvement.
The Role of Tools and Data in Target Setting
Accurate calculations are critical to setting and meeting science-based targets. The SBTi’s Corporate Net-Zero and Corporate Near-Term tools help businesses model their emissions reductions and ensure alignment with SBTi methodologies.
Additionally, life cycle assessment (LCA) can play a useful role in target setting by providing granular data on the carbon impacts of products and processes. LCA consists of multiple stages that calculate a range of possible environmental impacts, including GHG emissions. LCA has many benefits, helping identify emission hotspots across supply chains and forecast future impact (Prospective LCA), enabling companies to make data-driven decisions and focus on the areas with the greatest potential for reduction.
By following this process and leveraging tools like the SBTi target-setting tool and granular impact data within significant Scope 3 categories, businesses can ensure their targets are both scientifically grounded and actionable, paving the way for real and measurable GHG reductions.
SBTi Scope 3 target-setting
“Scope 3 often exceeds 90% of a company’s total emissions.”
Scope 3 emissions are an essential focus of the SBTi framework, particularly for industries with complex supply chains that are outside of their direct ownership and control like retailers of food, apparel and other consumer goods.
These emissions, which occur upstream and downstream of a company’s operations (e.g., from suppliers or product disposal), often make up the overwhelming majority of a company’s carbon footprint — sometimes exceeding 90% of total emissions.
Addressing Scope 3 and choosing the most impactful reduction scenarios and targets is therefore crucial for achieving meaningful climate impact and aligning with the Paris Agreement goals.
Why Scope 3 matters in SBTi
The Science Based Targets initiative requires companies to include Scope 3 emissions in their targets if these emissions account for more than 40% of their total GHG footprint. This ensures that businesses address their most significant emission sources, driving reductions not only within their operations but across their value chains.
Examples of Scope 3 reductions and target-setting
Tackling Scope 3 emissions requires innovative and targeted strategies. Here are a few examples:
- Supply chain optimization: Companies can work closely with suppliers to reduce emissions by transitioning to renewable energy, adopting energy-efficient manufacturing processes, or optimizing logistics for lower-carbon transportation.
- Product life cycle redesign: Reducing the carbon impact of products, monitored by ongoing life cycle assessments (LCA), can help companies identify emission hotspots. For example, designing durable, repairable, or recyclable products can minimize downstream emissions.
- Material substitution: Shifting to low-carbon or recycled materials in production can significantly reduce emissions across the supply chain.
By addressing Scope 3 emissions through SBTi target-setting, companies can build a framework for tackling their largest sources of emissions, amplify their climate impact, and foster collaboration across the value chain.
SBTi target setting guidance and tools
The Science Based Targets initiative provides comprehensive guidance and tools to help companies set, validate, and implement effective emission reduction targets.
These resources are designed to ensure that businesses align their climate strategies with the latest science, including addressing FLAG emissions, and best practices to achieve meaningful impact.
SBTi target setting guidance
The SBTi guidance includes step-by-step instructions and criteria for setting science-based targets. Key elements include:
- Validation criteria: Targets must meet rigorous standards, including alignment with a 1.5°C or well below 2°C scenario. Companies must define goals for Scope 1, 2, and 3 emissions, where applicable, and ensure they are measurable and time-bound.
- Sector pathways: SBTi also offers sector-specific guidance and pathways tailored to industries with unique emissions profiles, such as iron and steel, air transport, and oil and gas.
The SBTi Target Setting tool
To streamline the target-setting process, SBTi provides a Target Setting tool, which:
- Helps define emissions baselines and reduction pathways.
- Offers modeling aligned with SBTi methodologies, ensuring targets meet validation criteria.
- Simplifies tracking and progress measurement, enabling companies to stay on course toward their goals.
This tool is especially valuable for businesses with complex supply chains or significant Scope 3 emissions, offering clarity and precision in determining reduction opportunities.
The role of SBTi in driving GHG reduction
The Science Based Targets initiative has grown into a cornerstone framework within the family of leading ESG standards, helping support the global fight against climate change and empowering businesses to contribute meaningfully to greenhouse gas (GHG) reduction efforts.
By creating a unified framework based on climate science, SBTi aims to ensure that corporate actions align with the Paris Agreement’s 1.5°C goal, accelerating progress toward a low-carbon economy.
A catalyst for global collaboration
SBTi fosters global collaboration by standardizing how companies across industries approach GHG reduction. It bridges the gap between individual corporate efforts and collective climate goals, enabling businesses of all sizes to play a vital role in global decarbonization, no matter how far removed they may be from the direct sources of emissions.
This alignment helps drive systemic change as more organizations adopt science-based methodologies and require their value chains to follow suit through contractual requirements and expectations.
Enabling businesses to lead in sustainability
By leveraging SBTi, companies gain the tools and credibility needed to take bold steps toward emission reductions. It allows them to:
- Quantify their impact: With structured methodologies, businesses can measure their emissions accurately and identify reduction priorities.
- Integrate climate goals into business strategy: SBTi helps embed climate action into core business operations, ensuring long-term accountability and resilience.
- Enhance stakeholder confidence: Transparent, validated targets demonstrate to investors, customers, and regulators that the company is committed to sustainability, strengthening ESG performance.
Challenges and opportunities in target setting
Setting science-based targets involves navigating a range of challenges that require careful planning and innovative solutions. Data gaps remain one of the most significant obstacles, particularly in tracking and calculating Scope 3 emissions across global and fragmented supply chains. These gaps can stem from inconsistent data collection practices among suppliers or a lack of standardized methodologies across regions. Companies must also contend with resource constraints, such as insufficient internal expertise or technology, to manage complex emissions data and implement reduction strategies effectively.
Another challenge is alignment across stakeholders. Large organizations often struggle to unite internal departments, external suppliers, and partners under a single climate action framework, particularly when diverse priorities and financial limitations come into play. Additionally, regulatory uncertainty in some regions may make it harder for businesses to anticipate future compliance requirements.
Opportunities in target-setting
Despite these challenges, the opportunities in setting science-based targets are transformative. Companies that adopt clear and measurable targets often experience enhanced brand reputation as consumers increasingly prioritize environmentally responsible businesses. These efforts not only build investor confidence, as stakeholders value transparency and commitment to sustainability, but also attract talent drawn to purpose-driven organizations.
Operationally, setting targets drives efficiency gains by identifying and addressing emissions hotspots. This can lead to cost savings, such as lower energy use or optimized logistics, while simultaneously reducing environmental impact.
Furthermore, companies that embrace targets often uncover innovation opportunities, including the development of new products, processes, or materials that align with sustainability goals.
By addressing these challenges head-on and leveraging the opportunities, businesses can not only meet their emissions reduction goals but also position themselves as resilient, forward-thinking leaders in the global transition to a low-carbon economy.
SBTi and its correlation to key legislation and standards
SBTi provides companies with the frameworks and tools needed to align with the following legislations that intersect climate and retail, ensuring credible, transparent, and regulatory-compliant sustainability strategies.
Most specifically, CSRD compliance is at the forefront of the industry right now as its requirements are unfolding as part of its broader timeline. SBTi helps companies establish measurable GHG reduction targets aligned with Paris Agreement goals, enabling robust CSRD disclosures on transition planning areas (see also CSDDD transition plan requirements).. SBTi target setting further supports companies in their disclosures under the TCFD recommendations.
The Science Based Targets initiative stands as a powerful catalyst for global climate action, offering companies the frameworks and tools needed to set and achieve meaningful GHG reductions. In a time when the urgency of addressing climate change cannot be overstated, adopting science-based targets is not just an important step for the climate, but a strategic business decision to align company practices to a future climate-regulated world.
By aligning with SBTi, businesses can lead the way in reducing emissions, improving ESG performance, and building long-term resilience in an increasingly climate-conscious world. The journey from ambition to impact begins with measurable, actionable goals that are rooted in science.
Explore the SBTi target-setting process and take the first step toward transformative change. If you’re ready to turn your climate goals into tangible progress, get in touch. Our team can support you with the insights and tools you need to achieve meaningful carbon footprint targets and drive real impact.
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