SBTi: Science Based Targets Initiative

What It Is

The Science Based Targets initiative (SBTi) provides companies with a clearly defined pathway to set greenhouse gas emission reduction targets consistent with climate science. Launched in 2015 as a collaboration between CDP, the United Nations Global Compact, the We Mean Business Coalition, World Resources Institute, and WWF, it is now a registered charity in England and Wales whose subsidiary, SBTi Services, validates targets. SBTi has become the gold standard for corporate climate target-setting: as of September 2026, 12,052 companies had validated science-based targets and 14,271 had targets or commitments, according to the SBTi.

SBTi's core function is independent validation — verifying that a company's emissions reduction targets are aligned with the level of decarbonization required to limit global warming to 1.5°C above pre-industrial levels, as described in the IPCC's assessments. This third-party validation distinguishes SBTi targets from self-declared corporate climate pledges, which vary widely in ambition, methodology, and credibility.

SBTi offers two types of targets:

Near-term targets (required): 5-10 year targets covering Scope 1 and 2 emissions (a minimum 4.2% linear annual reduction for 1.5°C alignment) and Scope 3 emissions (required when Scope 3 represents 40% or more of total emissions).

Net-zero targets (optional but increasingly expected): Long-term targets requiring most companies to cut emissions at least 90% across all scopes by 2050 at the latest, with residual emissions (≤10%) neutralized through permanent carbon dioxide removal. A net-zero target pairs this long-term target with near-term targets.

These rules come from the current Corporate Net-Zero Standard (V1.3.1), which stays available until January 31, 2028. The SBTi published Version 2.0 in June 2026; it opens for validation on February 1, 2027, sets five-year near-term targets, and makes Scope 3 targets mandatory only for Category A companies (large companies, and medium-sized companies in high-income countries).

SBTi has developed sector-specific guidance for high-impact sectors including power generation, steel, cement, buildings, financial institutions, forest land and agriculture (FLAG), and others. It does not accept commitments or validate targets from oil and gas companies while its method for that sector is unfinished.

Who Uses It

• Large corporations across all sectors, with particular concentration in consumer goods, technology, manufacturing, and financial services
• Companies responding to investor pressure — SBTi validation is increasingly expected by Climate Action 100+ signatories and institutional investors
• Supply chain participants — large buyers with SBTi supplier engagement targets ask their suppliers to set science-based targets of their own
• CDP reporters — SBTi status is captured in CDP's questionnaire and contributes to scoring
• Companies subject to CSRD — ESRS requires disclosure of whether targets are science-based, making SBTi validation a practical evidence point
• Small and medium enterprises — SBTi offers a streamlined validation route with simplified requirements for SMEs, defined as companies with under 10,000 tCO2e of Scope 1 and location-based Scope 2 emissions that also meet size tests on employees, turnover and assets

Key Requirements

1. Commit (optional) to setting a science-based target by registering with SBTi Services and submitting a commitment letter. Companies that commit have 24 months to submit targets for validation; companies ready to submit can skip this step, and SMEs cannot commit.

2. Measure emissions following the GHG Protocol — complete Scope 1, 2, and 3 inventories. Under V1.3.1 the base year must be 2015 or later; Version 2.0 requires the most recent year with complete data.

3. Set near-term targets covering at least 95% of Scope 1 and 2 emissions, with a minimum 4.2% linear annual reduction (for 1.5°C alignment). Scope 3 targets are required if Scope 3 is ≥40% of total emissions.

4. Submit for validation — provide methodology documentation, emissions data, and target details. SBTi Services reviews against the SBTi's criteria and either validates, requests revisions, or rejects.

5. Report progress annually through CDP or equivalent public disclosure. Targets must be reviewed at least every five years (and updated and revalidated if they no longer meet current criteria), and recalculated after significant changes (M&A, divestment, methodology changes).

For net-zero targets, most companies must achieve at least 90% absolute emissions reduction across all scopes by 2050, with residual emissions neutralized by permanent carbon dioxide removal.

How to Implement

Phase 1: Emissions Baseline (2-4 months) Develop a comprehensive GHG inventory following GHG Protocol standards. Ensure coverage of all material Scope 3 categories. Select an appropriate base year (2015 or later under V1.3.1; the most recent year with complete data under Version 2.0).

Phase 2: Target Development (2-3 months) Use SBTi's target-setting methods — absolute contraction approach (most common), sectoral decarbonization approach (for certain sectors), or physical intensity targets (for specific sectors). Model reduction pathways that achieve required ambition levels. Identify the specific reduction levers (energy efficiency, renewable energy, process changes, supply chain engagement).

Phase 3: Reduction Roadmap (1-2 months) Develop a detailed implementation plan showing how targets will be achieved. This isn't submitted to SBTi but is essential for internal alignment and credibility.

Phase 4: Validation Submission (about 40 business days for review) Submit target documentation to SBTi Services, which delivers corporate validation results within 40 business days of the service start date. Be prepared for clarifying questions or revision requests.

Phase 5: Implementation and Reporting Execute the reduction roadmap. Report progress annually through CDP or public disclosure. Review targets at least every five years.

Relationship to Other Frameworks

SBTi builds on the GHG Protocol for emissions measurement methodology — you cannot set SBTi targets without a GHG Protocol-compliant inventory.

SBTi targets can be reported through CDP and contribute to CDP scoring. CDP's questionnaire captures SBTi commitment status, validation status, and progress against targets.

ISSB IFRS S2 requires disclosure of climate targets, including whether a third party has validated them, and ESRS E1 asks whether targets are science-based. SBTi validation provides the evidence.

TCFD Metrics & Targets pillar (now carried into IFRS S2, after the TCFD disbanded in October 2023) calls for disclosure of emissions reduction targets — SBTi-validated targets represent best practice for this disclosure.

SBTi's FLAG guidance connects to TNFD and SBTN (Science Based Targets for Nature) for companies with significant land use impacts.

Why It Matters

SBTi has achieved something remarkable: it created a credible, independently validated standard for corporate climate targets that is recognized by investors, regulators, customers, and civil society globally. In a landscape cluttered with vague net-zero pledges and self-declared commitments, SBTi validation provides the assurance that a company's targets are actually consistent with what climate science requires.

The initiative is increasingly moving from "nice to have" to "need to have." Institutional investors use SBTi status in engagement and voting decisions. Large buyers with supplier engagement targets ask their suppliers for it. CSRD and other regulations ask companies to disclose whether their targets are science-based. Companies without validated targets face growing questions about the credibility of their climate commitments.

The practical challenge is that SBTi requires real emissions reduction — not offsets, not creative accounting. For companies willing to make genuine operational changes, SBTi provides the framework and credibility. For companies hoping to claim climate leadership without fundamental business model changes, SBTi is deliberately designed to be out of reach.