Introduction
In an era defined by the urgency of climate change, businesses around the world are increasingly recognizing the importance of integrating sustainability into their corporate strategies. One of the most impactful ways to demonstrate climate leadership is by setting science-based targets—targets that align corporate emissions reduction goals with what the latest climate science says is necessary to meet the objectives of the Paris Agreement.
As we move toward a low-carbon future, setting ambitious emissions reduction targets is more than a formality—it’s a commitment to leading the transition. The challenge is ensuring your targets are scientifically sound and effective. That’s where the Science-Based Targets initiative (SBTi) comes in, offering the guidance and validation you need to back your climate strategy.
This blog explores the concept of science-based targets, the role of the SBTi, the importance of aligning corporate strategies with climate science, and how businesses can successfully integrate these targets into their operations.
What Are Science-Based Targets?
Science-based targets are greenhouse gas (GHG) emissions reduction goals that are consistent with what the latest climate science deems necessary to limit global warming to well below 2°C above pre-industrial levels—and ideally to 1.5°C. Unlike generic sustainability goals, science-based targets are based on rigorous scientific methodologies and are validated by the Science-Based Targets initiative (SBTi).
The purpose of science-based targets is to provide a clear pathway for companies to reduce their emissions in line with global climate goals. These targets ensure that corporate commitments are credible, measurable, and contribute to the broader societal objective of avoiding the worst impacts of climate change.
The Role of the Science-Based Targets Initiative (SBTi)
The SBTi is a collaborative effort between CDP, the United Nations Global Compact (UNGC), World Resources Institute (WRI), and the World Wide Fund for Nature (WWF). Its main role is to define and promote best practices in emissions reductions and net-zero targets in line with climate science.
By setting science-based targets, companies are required to submit their goals to the SBTi for validation. The initiative provides detailed guidance and sector-specific resources to help companies align their climate strategies with scientific benchmarks.
Why Businesses Should Set Science-Based Targets
1. Enhancing Corporate Reputation
Organizations that set science-based targets position themselves as environmental leaders, gaining credibility with investors, customers, and regulators.
2. Mitigating Risks
Climate-related financial and regulatory risks are increasing. By setting science-based targets, companies demonstrate that they are proactively managing these risks.
3. Driving Innovation
Pursuing science-based targets often leads to operational efficiencies and innovation, unlocking new technologies and reducing long-term costs.
4. Meeting Stakeholder Expectations
Consumers, employees, and investors increasingly demand climate responsibility. Science-based targets show that a company is committed to real, impactful change.
Aligning with the Paris Agreement
The Paris Agreement aims to limit global temperature rise to well below 2°C and pursue efforts to limit it to 1.5°C. Science-based targets are a critical tool for companies to align their business models with this international climate framework.
Setting science-based targets ensures that your company’s decarbonization pathway supports the global transition to a net-zero economy. This alignment is not just about compliance—it’s about resilience and long-term success in a rapidly changing climate landscape.
Scope of Emissions Covered in Science-Based Targets
Science-based targets address three scopes of GHG emissions:
- Scope 1: Direct emissions from owned or controlled sources
- Scope 2: Indirect emissions from the generation of purchased energy
- Scope 3: All other indirect emissions in the value chain
For many companies, Scope 3 emissions represent the majority of their carbon footprint. Therefore, comprehensive science-based targets typically include Scope 3 goals to ensure holistic climate action.
Tools and Frameworks Supporting Science-Based Targets
To support companies in setting and achieving science-based targets, the SBTi provides:
- Target-setting tools: For calculating reductions based on sector and size
- Guidelines and manuals: Offering in-depth instruction for various industries
- SBTi Net-Zero Standard: Helping companies set and achieve net-zero emissions
GoodLab’s advisory services, for instance, help organizations navigate the complexities of these frameworks, offering tailored support to align goals with SBTi requirements.
Integrating Science-Based Targets into Corporate Strategy
To make science-based targets truly impactful, they must be embedded into the company’s broader business strategy. This involves:
- Linking executive compensation to climate goals
- Embedding climate metrics into risk assessments
- Allocating capital expenditures to low-carbon initiatives
- Training employees to support the sustainability mission
Companies like GetGoodLab help businesses with these strategic integrations, making climate commitments operational and effective.
Overcoming Challenges in Setting Science-Based Targets
Some of the key hurdles companies face include:
- Data availability: Accurate emissions data is essential for setting meaningful science-based targets.
- Internal buy-in: Convincing leadership and stakeholders of the value of these targets can be difficult.
- Long-term planning: SBTi-aligned targets often span decades and require long-term vision and planning.
However, these challenges can be overcome through expert guidance, cross-functional collaboration, and strong leadership commitment.
The Growing Demand for Science-Based Targets
The momentum behind science-based targets is growing rapidly. As of now, thousands of companies have committed to setting or already have validated targets, representing trillions in market capital. Regulatory bodies, investors, and stock exchanges are increasingly viewing science-based targets as a benchmark for corporate responsibility.
Businesses that act now will not only stay ahead of regulations but also secure competitive advantages and stakeholder trust in a decarbonizing economy.
Science-Based Targets and ESG Performance
Environmental, Social, and Governance (ESG) performance is now a critical indicator of a company’s value. Setting science-based targets can significantly boost ESG ratings by:
- Demonstrating climate leadership
- Reducing exposure to environmental risks
- Enhancing transparency and reporting credibility
Investors are rewarding companies that take climate risk seriously and act decisively with validated science-based targets.
The Bottom Line
Setting science-based targets is no longer just an option—it’s a business imperative. As climate change accelerates and stakeholder expectations rise, companies that align their strategies with climate science will lead the way. The Science-Based Targets initiative (SBTi) offers the structure, credibility, and guidance necessary to ensure corporate climate goals are meaningful and effective.
Organizations that embrace science-based targets are future-proofing their business, enhancing their brand, satisfying stakeholder demands, and contributing to a sustainable world. With expert support from platforms like GoodLab, the journey toward a low-carbon future is not just possible—it’s within reach.
