Foundations for net-zero target-setting in the corporate sector
We’ve launched a process to develop the first science-based global standard for corporate net-zero targets, to ensure that companies’ net-zero targets translate into action that is consistent with achieving a net-zero world by no later than 2050.
Our new paper lays out the conceptual foundations for credible, science-based net-zero targets for the corporate sector:
Net zero: a north star for climate action
According to the latest report by the Intergovernmental Panel on Climate Change (IPCC), to limit global warming to 1.5°C above pre-industrial levels and avoid the most catastrophic impacts of climate change, the world must halve CO2 emissions by around 2030 and reach net-zero CO2 emissions by mid-century.
Recognizing the importance of keeping global warming to 1.5°C, companies are increasingly adopting net-zero climate targets. Between July 2019 and June 2020, over 230 companies committed to reach net-zero emissions as part of the Business Ambition for 1.5°C campaign, an urgent call-to-action for companies to set emissions reduction targets in line with a 1.5°C future. The campaign is led by the SBTi and backed by a global coalition of UN leaders, business organizations and NGOs.
Science-based net-zero targets for companies
At the global level, the IPCC provides a clear definition of net zero: Net-zero emissions are reached when anthropogenic (i.e., human-caused) emissions of greenhouse gases to the atmosphere are balanced by anthropogenic removals over a specified period.
Within the corporate context, however, the definition is not so clear, leading to significant confusion and inconsistent claims. Without a common science-based definition of what constitutes a “net-zero” target, companies and their stakeholders can’t be sure that their long-term climate targets are credible or ambitious enough.
In 2019, the SBTi initiated an inclusive, stakeholder-informed process to develop a framework to enable companies to set robust and credible net-zero targets in line with a 1.5°C future. The framework will include net-zero target validation criteria, allowing companies to have their net-zero targets validated by the SBTi, as well as user friendly guidance for setting net-zero targets.
- Jessica Andrews, Net-Zero Asset Owners Alliance
- Jen Austin, High-Level Champions
- Richard Batten, JLL
- Chris Bayliss, Aluminium Stewardship Initiative
- Giulio Berruti, BSR
- Derik Broekhoff, Stockholm Environment Institute
- Dean Cambridge, We Mean Business
- Gary Cook, Stand.Earth
- Nafkote Dabi, Oxfam
- Luca de Giovanetti, WBCSD
- Faustine Delasalle, Energy Transitions Commission
- Ramiro Fernández, High-Level Champions / Fundacion Avina
- Karol Gobczynski, Ikea
- Tom Hale, Oxford University
- Owen Hewlett, Gold Standard
- Emily Hickson, B Team
- Anthony Hobley, WEF
- Robert Höglund
- Michael Hugman, CIFF
- Alexia Kelly, Netflix
- Ankita Kumari, Survival International
- Thomas Lingard, Unilever
- Valentina Lira, Viña Concha y Toro
- Cynthia McHale, Climate Action 100+
- Mischa Reppman, Swiss Re
- John Revess, WBCSD
- Daniel Salter, Amazon
- Stephan Singer, Climate Action Network
- Eveline Speelman, Energy Transitions Commission
- Doreen Stabinsky, College of the Atlantic
- Salla Sulasuo, DSM
- Sam van de Plas, Carbon Market Watch
- Candace Vinke, Verra
- Roy Vissers, DSM
- Carsten Warnecke, New Climate Institute
- Helen Wiggs Marshall, ShareAction
- Pedro Martins Barata, EDF
The framework is being developed through a balanced, transparent, and inclusive stakeholder process, including consultations with the SBTi’s Scientific and Technical Advisory Groups, a dedicated Net Zero Expert Advisory Group and a Stakeholder Consultative Group.
Decisions will be developed through building consensus and all outputs will be subject to comprehensive and rigorous reviews by stakeholders. The SBTi will make every effort to reach consensus within the Expert Advisory Group. If consensus cannot be reached on aspects of the framework, the SBTi retains the authority to make a final decision.
We are actively engaging with interested individuals and organizations to provide feedback on draft materials through two public consultations; participate in ad-hoc information / consultation sessions (e.g. webinars, workshops, etc.); and participate in road testing. To stay up to date on the Net-Zero Standard and receive information on participation opportunities, please sign up here.
The Net Zero Road Test is now underway. Between 15 July 2021 and 31 August 2021, over 80 companies are road testing the target validation criteria and guidance for the SBTi’s Net-Zero Standard. This will help us ensure the criteria, guidance and net-zero target setting tools we give to companies once the Standard launches in October are robust, clear and practical. It will also help identify challenges for adoption and implementation of the Standard across industries.
The road test focuses on criteria and methods for setting near-term and long-term science based targets which aim to reduce value-chain emissions in line with the science.
The companies road testing the SBTi Net-Zero Standard include:
- ab inbev
- A.P. Moller-Maersk
- ABOUT YOU AG & Co. KG
- ACCIONA Energía
- ACCIONA S.A
- Baluarte Cultura
- Bayer AG
- Bloomberg LP
- BMW Group
- Boston Consulting Group
- Colgate Palmolive Company
- Deutsche Telekom AG
- EDP Energias de Portugal
- Emira Property Fund
- Enel S.p.A.
- FLSmidth A/S
- Holcim Ltd.
- International Consolidated Airlines Group (IAG)
- Kesko Corporation
- Magyar Telekom Plc.
- Mahindra Lifespace Developers Limited
- McCain Foods
- Multiplex Construction Europe
- Outokumpu Oy
- Pfizer Inc.
- Pilgrim's UK
- Ralph Lauren Corporation
- Rolls-Royce plc
- Sopra Steria Group
- Swire Properties Limited
- Swiss Re
- Telenor ASA
- Veritas Technologies
- Wipro Ltd
- WSP Global Inc.
Foundations for net-zero target-setting in the corporate sector:
The first public consultation on the SBTi Net-Zero Criteria closed on 12th of March 2021.
Please find the draft criteria (including instructions on commenting and the consultation process) below:
- SBTi Net-Zero Standard Criteria Draft for Public Consultation
- Key Questions that were put to Public Consultation
- Net-Zero Criteria Draft for Public Consultation Feedback Report
- Net-Zero Criteria Draft for Public Consultation Feedback Report - Summary
View the consultation launch webinar recordings (held in 2 time zones):
Videos explaining the Net-Zero Draft Criteria and addressing FAQs: View the full playlist or go to individual videos below:
- Net-Zero Foundations and Overview
- Development Process and Public Consultation
- Emissions Abatement and Residual Emissions
- Scope 3
Net-Zero Road Test
- SBTi Net-Zero Criteria for Road Test
- SBTi Net-Zero Road Test Welcome Pack
- SBTi Net-Zero Corporate Manual for Road Test
- How-To Guide for the SBTi's Net-Zero Standard for Road Test
- Road Test Launch Webinar Slides
- Towards a Science-Based Approach to Climate Neutrality in the Corporate Sector by the yobet娱乐app initiative and CDP (September 2019)
- UN Global Compact Academy E-learning Course on Science-Based Targets
The SBTi began consultations with companies and relevant stakeholders in September 2019 to develop a set of guiding principles to ensure that corporate net-zero targets are consistent with the transformation required to transition towards a net-zero economy and propose a working definition of a corporate net-zero target.
Following on from the publication of the ‘Foundations for net-zero target setting in the corporate sector’ paper in September 2020, the SBTi is in the process of developing detailed criteria and guidance. A public consultation on the criteria was open for comments for two months and closed on 12th of March 2021. The Net-Zero methods and tools will be road tested by companies from July 15th to August 31st 2021. A second version of the Criteria will be published for public consultation in September. A final net-zero framework,
including target-setting guidance and target validation criteria, will be released in 2021.
Please see below for the latest timeline for this process.