The changing SBTi Corporate Net-Zero Standard

All you need to know about the changing SBTi Corporate Net-Zero Standard

The Science Based Targets initiative (SBTi) is revising its Corporate Net-Zero Standard, introducing key updates through the formation of five new Expert Working Groups and a second public consultation. This initiative seeks input from businesses and stakeholders, allowing them to shape the future of net-zero target setting. Over 10,000 companies and financial institutions have committed to science-based targets in the past decade, with more than 1,500 setting net-zero targets in line with the SBTi Corporate Standard.

The SBTi’s revisions aim to incorporate emerging science, real-world experience, and feedback from various sectors to create a more practical and effective standard while maintaining its ambitious goals. Notably, the updated standard will offer enhanced guidance on managing Scope 3 emissions, focusing on value chain carbon reduction efforts. The SBTi’s goal is to refine scope 3 target-setting by providing companies with a broader range of metrics, methods, and tools.

Two critical areas of the revision and Temple’s experience in these areas are:

1. Scope 3 Emissions:

Tackling value chain emissions remains one of the biggest challenges in achieving net-zero. The SBTi’s recent paper highlights that nearly 97% of companies with validated targets address Scope 3 emissions. To improve, companies can benefit from tools that enable a more comprehensive approach to managing these emissions, including enhanced target-setting methods and identifying climate-relevant activities using factors like emission magnitude and engagement with suppliers and customers.

In our recent role as National Carbon Specialist for the Environment Agency, Temple has worked on assessing and reducing carbon in construction projects aligned with SBTi goals, by engaging with the supply chain on the use of contractual instruments to drive decarbonisation towards net-zero targets we have seen first-hand how effective this can be.

2. Data Quality, Assurance, and Substantiation of Claims:

The SBTi does not allow carbon credits to count as emission reductions toward Science Based Targets but is exploring the potential of using carbon credits from mitigation activities within the value chain in the future, where they represent emissions abatement.

Temple has provided independent third-party GHG footprint verification since 2012, ensuring compliance with ISO standards. We have also supported carbon offset validation, ensuring companies substantiate their emissions reductions; we recently validated the retirement of high-quality carbon credits for a global consultancy’s net-zero strategy.

Moving forward, companies will need to take steps to better manage, measure and disclose emissions across the value chain, prioritise climate-relevant sources, set clear targets, implement action plans, and track progress. By adopting these strategies and using the updated SBTi framework, businesses can make more meaningful contributions to global decarbonisation efforts while ensuring transparency and accountability in their climate actions.

For our own emissions, and our target to be zero carbon by 2030, Temple will be closely watching these developments to see if and how the new standard will support our goals. As a purpose driven SME, we consciously chose alignment with SBTi criteria, but as yet have not sought SBTi validation, perhaps the updated standards will encourage us to do so.