Why Science-Based Targets Are the Gold Standard for GHG Emissions Strategy

Northmore Gordon

The international community is coming together to tackle climate change. The multi-stakeholder development of the Science-Based Targets initiative (SBTi) provides guidelines and standards for companies to set net-zero greenhouse gas (GHG) emissions targets designed to limit global climate change to 1.5° Celsius relative to pre-industrial levels.

The purchase of carbon offsets cannot contribute to SBTi near-term or long-term targets, but companies are expected to use carbon removals, including carbon credits, to offset any residual emissions that remain once emissions from a company’s entire value chain have been reduced to a level that aligns with SBTi criteria. For most businesses, these residual emissions are capped at 10% of total value chain emissions. This places impactful emphasis on companies to actively reduce their own Scope emissions.

The rigour and comprehensive scope of the SBTi are exactly what society needs to take meaningful steps toward accelerated decarbonisation. With thousands of companies already working with SBTi, this target-structured approach is set to become the gold standard protocol for companies looking to take ownership over their environmental impact and demonstrate climate action leadership.

What are Science-Based Targets?

In this context, science-based targets are greenhouse gas (GHG) emissions reduction goals with clearly defined pathways that align with scientific consensus on how to limit global climate change to 1.5°C relative to pre-industrial levels.

Science-based targets involve establishing a baseline reference year and setting near-term and long-term targets in pursuit of net-zero emissions. The interim near-term target typically has a deadline of 5-10 years after plan submission to SBTi and requires steady year-over-year emissions reductions that keep the company on track to meet their long-term target. The long-term target reflects an overall percentage reduction of GHG emissions across a company’s value chain that must be met by 2050. 

How to Set a Science-Based Target

The SBTi outlines a five-step process for companies to set their own targets:

  1. Commit: this involves a letter submission that declares the company’s commitment to setting a science-based target. This submission activates a two-year countdown to complete steps two through four.
  2. Develop: the company needs to establish a baseline year reflective of normal operating conditions and then set near- and long-term targets that align with SBTi criteria for mitigating climate change.
  3. Submit: the company must present their target to the SBTi for official validation.
  4. Communicate: once approved, the company has to inform stakeholders of its science-based target through an official announcement.
  5. Disclose: the company compiles annual reports that reveal its emissions and track progress toward meeting targets.

Who is Setting Science-Based Targets

The number of companies associated with SBTi continues to rise, with nearly 3,000 companies having commitments and 1,374 having approved targets. Household names like Amazon and Facebook are working with SBTi, as well as some of Australia’s largest companies such as Australian Postal Corporation, Bank Australia, and Intrepid Travel. Companies worldwide are noticing the impact of this movement, encouraging more and more to adopt SBTi strategies to tackle climate change and embrace leadership in sustainability.

Why are Science-Based Targets Important?

As the connection between fossil fuel use and climate change becomes clearer, there is a growing incentive to decarbonise as a benefit to the planet, people, and the economy. Joining SBTi enables companies to become part of this movement that will empower society and build a more resilient economy.

The World Needs to Decarbonise

First and foremost, the world must decarbonise. Continued use of fossil fuels is unsustainable and is linked to devastating global shifts – like climate change, sea-level rise, and ocean acidification – that threaten biodiversity, human wellbeing, and financial security.

A Strong Business Strategy

As global consensus unites on the need for decarbonisation, setting meaningful GHG emissions targets is becoming a best practice for companies across industries. Gone are the days when a company could declare a carbon reduction commitment without validating claims. Consumers and investors alike recognize that action is required, and they will gravitate toward companies that are taking action-driven steps toward decarbonisation. Therefore, setting science-based targets is also a strong way to stay relevant to increasingly climate-conscious consumers and investors. Soon, companies without well-established climate action plans will be at a disadvantage, as investors want to ensure their capital is in vehicles that are well-equipped to navigate the changing energy and business landscape.

It Will Strengthen Resilience

To support and accelerate decarbonisation efforts, governmental policy will have to play an impactful role. This will lead to regulatory bodies and reporting frameworks to increase prioritisation of climate action. Twenty-seven countries, including Singapore and New Zealand, have already embraced a carbon tax. More countries are likely to follow similar strategies that align net-zero initiatives with the corporate agenda. By setting science-based targets, a company is preparing for the inevitable shifts in carbon policy.

Additionally, pathways to reaching science-based targets involve strategies that will help companies save money and gain energy independence. The first steps to decarbonisation often involve improving energy efficiency, which results in lower fuel demands and therefore fewer operational expenses. Beyond energy efficiency, pathways will consider electrification of processes to transition away from fossil fuels and leverage an electric grid with an increasing abundance of clean power generation from renewable energy sources. Taking advantage of the local energy grid reduces a company’s susceptibility to fluctuating fossil fuel prices, which will likely increase in the coming years as the world continues its energy transition and governments implement more policies that penalise carbon intensity. Therefore, transitioning to clean, renewable energy sources will provide more predictable energy costs and long-term energy cost savings.


The comprehensive SBTi approach provides guidance and support for companies serious about doing their part to tackle climate change. With targets designed to limit global warming to 1.5°C, companies and entire sectors will have to take transformational action. Those that do not acknowledge science-based targets or embrace the growing decarbonisation movement will be left behind as consumers and investors transition to climate-friendly options.

To help companies stay competitive and improve their corporate responsibility strategy, Northmore Gordon assists with the design, implementation, and reporting of SBTi commitments. We help companies experience profitable decarbonisation that aligns with best scientific practices and their corporate objectives.

SBTi and Northmore Gordon are building momentum. Despite not currently being on pace to uphold the 1.5°C climate change limit set in the Paris Climate Agreement, we are much closer now than we were ten years ago. Through dedication and cooperation, companies and industry can align with SBTi and cement their legacy as being part of the turning point that led society towards a cleaner, brighter future.

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