Science Based Targets initiative (SBTi) Corporate Standard

Public communications about science based targets shall be accurate, not misleading, and clearly distinguish between approved targets, commitments, ambitions, and progress against them.

• Climate communications policy
• Approved language register for targets
• Marketing review process for climate claims
• Investor communications consistency check
• Anti greenwashing controls

• Net-zero claimed before approval
• Ambition language used for commitments
• Marketing inconsistent with disclosures
• No review of climate claims

Carbon offsets shall not be counted toward meeting near-term science based targets which must be achieved through actual emission reductions within the inventory boundary.

• Reduction trajectory excluding offsets
• Separate disclosure of voluntary offset purchases
• Internal accounting policy
• Audit of progress calculations
• Public statement separating offsets from reductions

• Offsets counted toward target
• Reduction accounting mixed with offsets
• Public claims conflate offsets and reductions
• No separation in disclosure

Companies shall publicly commit to setting science based emission reduction targets within 24 months and align target ambition with the latest climate science to limit warming to 1.5 degrees Celsius.

• Signed SBTi commitment letter
• Public announcement on company website
• Internal project plan with 24 month timeline
• Executive sponsor designation
• CDP commitment disclosure

• Commitment not announced publicly
• 24 month timeline exceeded
• No executive sponsor
• Internal project plan absent

Companies shall define the inventory boundary using either operational control or financial control consolidation approach and apply it consistently across Scopes 1, 2, and 3 reporting.

• Documented consolidation approach
• List of consolidated entities
• Equity share disclosure where relevant
• Boundary description in disclosures
• Mapping to financial reporting entities

• Approach inconsistent with financial reporting
• Material entities excluded
• Equity share approach not justified
• Boundary not transparent

A base year shall be selected with reliable activity data not older than the maximum allowed period and a complete inventory for that year covering all in scope emissions.

• Base year emissions inventory by scope
• Data quality assessment
• Recalculation policy
• Justification for base year choice
• Activity data sources and emission factors

• Base year older than maximum allowed
• Data quality poor
• No recalculation policy
• Base year inventory incomplete

Scope 1 direct emissions from owned or controlled sources including stationary combustion, mobile combustion, process emissions, and fugitive sources shall be quantified and included in target setting.

• Scope 1 inventory by source category
• Fuel consumption records
• Process emissions calculations
• Fugitive refrigerant logs
• GWP factors used

• Fugitive emissions omitted
• Process emissions underestimated
• Outdated GWP factors
• Mobile sources missing

Scope 2 emissions from purchased electricity, heat, steam, and cooling shall be reported using both location based and market based methods consistent with the GHG Protocol Scope 2 Guidance.

• Scope 2 location based and market based inventories
• EAC purchase and retirement records
• Grid emission factor sources
• PPA settlement statements
• Residual mix factors where applicable

• Only one method reported
• EACs not retired in registry
• Outdated grid factors
• Geographic mismatch in market based

Companies shall screen all 15 Scope 3 categories for relevance and quantify material categories that meet the inclusion criteria based on magnitude, influence, risk, and stakeholder interest.

• Screening results across all 15 categories
• Materiality determination by category
• Justification for exclusions
• Scope 3 inventory by included category
• Methodology and data quality scoring

• Screening superficial
• Material categories excluded without basis
• Use of sold products underestimated
• Investments category omitted by financial institutions

When Scope 3 emissions represent at least 40 percent of total emissions companies shall set a Scope 3 target covering at least 67 percent of total Scope 3 for near-term horizons.

• Scope 3 share of total emissions calculation
• Coverage percentage by Scope 3 category
• Approved Scope 3 target statement
• Supplier engagement strategy where applicable
• Categories included in target

• Coverage below 67 percent threshold
• Scope 3 share miscalculated
• Material categories excluded from target
• Engagement strategy missing

Where Scope 3 targets are set on a supplier engagement basis, companies shall implement a documented programme to engage suppliers in setting their own science based targets within the target period.

• Supplier engagement programme charter
• Coverage percentage tracking
• Supplier capability building activities
• Annual supplier target uptake reporting
• Procurement policy updates

• No formal programme
• Supplier coverage not tracked
• Capability building absent
• Procurement not aligned to targets

Companies shall establish internal governance structures for climate targets including board oversight, executive accountability, and clear roles for measurement, reporting, and delivery.

• Board climate oversight charter
• Executive accountability documentation
• Internal climate steering group records
• Sustainability function reporting line
• Annual board reporting on targets

• No board oversight
• Sustainability function isolated
• No executive KPIs for climate
• Board reporting infrequent

Financial institutions shall apply SBTi Financial Sector Guidance to set portfolio targets covering financed emissions across applicable asset classes using approved methodologies.

• Financed emissions inventory using PCAF
• Asset class coverage analysis
• Portfolio temperature alignment scoring
• Sectoral targets where required
• Data quality scoring by exposure

• Financed emissions incomplete
• PCAF data quality scores low
• Sectoral targets missing
• Coverage thresholds not met

Companies shall maintain a recalculation policy that triggers updates to targets and base year inventory in response to structural changes, methodology updates, or material data corrections.

• Documented recalculation policy
• Defined materiality thresholds
• Recalculation event log
• Updated targets after structural change
• Communication of recalculations

• Recalculation policy absent
• Thresholds not defined
• Mergers not reflected in inventory
• No communication of changes

Companies shall review and update approved targets at least every five years to ensure ongoing ambition consistent with the latest climate science and SBTi standard updates.

• Five year review schedule
• Tracking of SBTi standard updates
• Gap analysis against current standard
• Resubmission package
• Updated approval letter

• No review schedule
• Old approval still cited after standard update
• Gap analysis not performed
• Resubmission delayed

Near-term targets shall be set for a period of 5 to 10 years from submission and aligned with pathways that limit warming to 1.5 degrees Celsius for Scope 1 and 2 emissions.

• Approved near-term target language
• Pathway alignment workbook
• 5 to 10 year horizon documentation
• Annual linear reduction calculation
• Public target disclosure

• Target horizon outside 5 to 10 years
• Pathway not 1.5C aligned
• Linear reduction rate insufficient
• Target language ambiguous

Companies shall select an SBTi approved methodology including absolute contraction, sectoral decarbonization approach, or sector specific methods appropriate to their activities and target scope.

• Documented methodology selection rationale
• Target calculation workbook
• Sector classification mapping
• Intensity metric definitions where used
• Method version reference

• Method inappropriate for sector
• Calculation errors
• Intensity metric inconsistent
• Outdated method version applied

Companies shall submit targets to SBTi for validation within 24 months of commitment using the official submission process and pay applicable validation fees.

• Completed SBTi target submission form
• Validation fee payment record
• SBTi correspondence and queries
• Approval letter from SBTi
• Approved target language for publication

• Submission after 24 month deadline
• Validation queries unanswered
• Approval letter not retained
• Approved language not used in disclosures

Companies shall disclose annually their greenhouse gas emissions inventory and progress against targets through public channels including annual reports, sustainability reports, or CDP submissions.

• Annual sustainability or integrated report
• CDP Climate Change response
• Public GHG inventory by scope
• Progress against target chart
• Methodology disclosures

• Annual disclosure not published
• CDP submission incomplete
• Progress data inconsistent across reports
• Methodology not transparent

Companies shall disclose progress against approved targets including emissions reduction achieved relative to base year and explain variance from planned trajectory.

• Year over year emissions progress chart
• Percentage reduction from base year
• Variance explanation narrative
• Forward projection to target year
• Restated emissions where applicable

• No variance explanation
• Progress not tied to approved targets
• Restatements not disclosed
• Trajectory chart absent

Companies are recommended to obtain independent assurance of greenhouse gas inventories and progress disclosures at limited or reasonable assurance levels to support credibility.

• Independent assurance statement
• Provider competence and independence documentation
• Assurance scope including Scope 3 categories where material
• Management responses to assurance findings
• Year over year scope expansion plan

• Assurance scope excludes Scope 3
• Provider not accredited
• Findings not addressed
• Scope reduced year over year