Luckily, we have had COP21 where agreements were made to
limit global warming to 2°C. And please also take a look at our January
blog. There we argued that stricter guidelines and regulations on emission
reduction and energy consumption targets were to be expected.
However, as things go, the market is already ahead of policy
makers. For instance with new target setting initiatives and benchmarks. A
first concrete example of this is the Science-Based
Targets initiative (SBTI), a partnership between CDP, UN Global Compact,
WRI and WWF. SBTI aims to support organisations in taking emission target
setting to the next level. But what are science-based targets? Why are they needed? What are the benefits and
how can business integrate them in their strategy?
What are
Science-Based Targets?
Science-based targets (SBTs) are organizational targets that
are in line with scientifically confirmed requirements for the transition to a
low carbon economy through which we can stay within the 2 degree threshold. The
efforts around the 2 degree approach are then cascaded to countries’ sectors
and organisations. One method used to determine such targets is the Sectoral
Decarbonization Approach (SDA). [1]
The underlying idea of science-based targets is pretty
simple. Currently, most organisations have integrated emission reduction,
climate change, or environmental goals into their short- and long-term
strategies. They have set relevant targets for their own operations or even
expanded these efforts to their value chain.
But how can we ensure that all the ambitions and efforts
contribute to staying within the 2°C limit, and at the pace climate scientists
believe is needed? This is where science-based targets become relevant. The
more organisations that align their greenhouse gas emission reduction efforts
to the science-based targets, the higher the probability of limiting climate
change consequences. All thanks to concept of critical mass effects.
But why?
We all want to protect the planet we live on. The more we
work on this together, the bigger the impact and the more streamlined efforts
will be. That is the most obvious benefit of SBT.
But there are more benefits to be had for organizations, especially
for the big players who have a huge impact because of their size and global
footprint. They now have a validated way of setting their targets while
simultaneously linking their efforts to the world’s biggest threat. Additional
benefits are a closer alignment with the requirements of the Carbon Disclosure
Project (CDP) which in turn will satisfy investors. Another big advantage is
that, with comparable targets, benchmarking between companies becomes much
easier and a level playing field is created.
How do we work with
Science-Based Targets?
The remaining question and challenge concerns how
science-based targets can be applied. The Science-Based Targets initiative
(SBTI) provides a manual
covering this and an overview of the different methodologies that can be used
to align GHG emission reduction efforts to science-based targets. According to
the SBTI, a 3 stage process should be followed to integrate SBTs into practice.
1.
Getting started
a.
Make the business case
b.
Understand the methods
2.
Setting the Science-Based Target
a.
Choose a SBT method
b.
Determine the target
3.
Announcing and implementing
a.
Gain internal buy-in
b.
Report and communicate
c.
Implement
Organizations should create a business case to enable them
to understand the relevance and impact for their own business. This also helps
create an understanding about their needs and so identify a SBT method that best
suits their organization. Having identified a method, such as (a) the
Context-based Carbon Metric (CSO), which allows for multiple scenarios covering
different regions, target years or industries, or (b) the 3% Solution, focusing
on reducing energy-related corporate emissions by 3.2% by 2020, the target can
be set accordingly.
Of course the process does not end after having determined
the SBT. Crucial steps for a successful integration include getting commitment
from internal stakeholders and decision makers, reporting and communicating the
target, and implementing initiatives in order to make the target achievement
possible.
So let’s see if can make this thing big! Let’s make our ambitions
bigger and bolder and send a signal to policy-makers that companies really are
willing to accept their responsibilities as regards saving the world. Right now
is always a good time to get started and find out how SBTs can be integrated
within your organization!
Nick de Ruiter is a partner at Sustainalize. He is a specialist in CSR strategy setting and performance monitoring.
Lena Hülsmann is
a consultant at Sustainalize for the German speaking markets. She is a
specialist in CSR target setting, benchmarking and reporting.
[1]
Science-Based Targets Initiative (2015). SECTORAL DECARBONIZATION APPROACH (SDA):
A method for setting corporate emission reduction targets in line with climate
science. Retrieved from http://sciencebasedtargets.org/wp-content/uploads/2015/05/Sectoral-Decarbonization-Approach-Report.pdf
