Introduction

In today’s corporate landscape, sustainability is no longer a “nice-to-have”, it is an operational necessity, investor expectation, and competitive advantage. As climate policies tighten across the UK, EU, and globally, businesses are under growing pressure to align with a scientifically credible pathway to limit global warming.

The Science Based Targets initiative (SBTi) has emerged as the leading global framework for defining, validating, and verifying such pathways. It bridges the gap between climate science and corporate action, setting the standards that ensure business climate targets are not only ambitious but also achievable, transparent, and consistent with the Paris Agreement.

For UK and international organisations, understanding and implementing SBTi-aligned targets is key to maintaining credibility, winning tenders, and demonstrating long-term resilience.

This paper by NCZ provides a comprehensive overview of SBTi (its purpose, methodology, benefits, and challenges) and how businesses can practically align with it through credible carbon accounting and reduction strategies.

1. What is the Science Based Targets initiative (SBTi)?

The Science Based Targets initiative (SBTi) is a partnership between four leading environmental organisations:

•   CDP (formerly Carbon Disclosure Project)
•   United Nations Global Compact (UNGC)
•   World Resources Institute (WRI)
•   World Wide Fund for Nature (WWF)

Launched in 2015, the SBTi provides companies with a framework to set greenhouse gas (GHG) emission reduction targets in line with climate science, specifically the goal of limiting global temperature rise to 1.5°C above pre-industrial levels.

By establishing science-based targets, organisations demonstrate that their climate action plans are rooted in scientific evidence rather than arbitrary ambition. The SBTi also validates targets, giving external credibility to companies’ emissions reduction commitments.

2. Why SBTi Matters

a. The Science-Driven Approach

Unlike traditional corporate sustainability goals, SBTi ensures targets are consistent with the global carbon budget necessary to meet the Paris Agreement. It removes the guesswork and aligns business operations with a clear, measurable decarbonisation trajectory.

b. The Business Case for SBTi

1. Regulatory readiness – Governments are tightening reporting requirements. In the UK, the Streamlined Energy and Carbon Reporting (SECR) framework and the Task Force on Climate-Related Financial Disclosures (TCFD) require transparent climate data. SBTi alignment helps businesses stay ahead of compliance trends.
2. Investor and lender trust – Financial institutions are increasingly evaluating climate risk in portfolios. SBTi validation signals credibility and reduces perceived climate risk.
3. Tender competitiveness – Many large organisations, especially in the public sector, now prioritise SBTi-aligned suppliers when awarding contracts.
4. Brand and employee reputation – Consumers and employees alike are favouring businesses that demonstrate authentic, science-backed sustainability.

c. From “Net Zero” Claims to Verified Pathways

While many companies claim “net zero,” the SBTi ensures that these claims are backed by measurable reductions. According to SBTi guidance, a company can only be “net zero” once it has reduced at least 90% of emissions from its baseline and is offsetting no more than 10% of residual emissions through verified carbon removals.

3. The SBTi Target-Setting Framework

The SBTi framework follows a structured process to help organisations set and validate their targets.

Step 1: Commit

Organisations submit a commitment letter to the SBTi, pledging to set science-based targets within 24 months. This commitment is publicly listed on the SBTi website.

Step 2: Develop

The company calculates its full carbon footprint, including Scope 1 (direct), Scope 2 (indirect energy), and Scope 3 (value chain) emissions, and develops targets aligned with SBTi criteria.

Step 3: Submit for Validation

The developed targets are submitted to the SBTi for official validation. The process assesses whether the targets meet minimum reduction thresholds aligned with the 1.5°C or well-below-2°C pathways.

Step 4: Communicate

Once validated, the company publicly announces its targets. This transparency builds accountability and enhances stakeholder trust.

Step 5: Disclose and Report Progress

Companies are expected to report annual emissions and progress toward targets through public platforms such as CDP or their sustainability reports.

4. Understanding Scope Emissions within the SBTi Framework

The SBTi requires organisations to account for all relevant emission sources using the Greenhouse Gas (GHG) Protocol classification:

Scope 1: Direct Emissions

These are emissions from owned or controlled sources (e.g., company vehicles, boilers, generators, industrial processes).

Scope 2: Indirect Emissions

These result from purchased electricity, steam, heat, or cooling consumed by the business.

Scope 3: Value Chain Emissions

These include all other indirect emissions, such as those from suppliers, transport, product use, waste, and employee commuting. Scope 3 emissions which often account for 70–90% of a company’s total footprint and are mandatory for SBTi target-setting.

5. The Science Behind the Targets

The SBTi uses carbon budget modelling based on IPCC data to determine how much each sector and company must reduce to align with global temperature limits. Targets are calculated using methodologies such as:

•       Absolute Contraction Approach – Requires companies to reduce emissions by a fixed percentage per year, regardless of growth.
•       Sectoral Decarbonisation Approach (SDA) – Applies industry-specific pathways (e.g., aviation, manufacturing, real estate).
•       Economic Intensity Approach – For financial institutions or service providers, this relates emissions reductions to economic value generated.

6. SBTi’s Corporate Net Zero Standard

In 2021, the SBTi launched the Corporate Net Zero Standard, which defines what it means for a company to achieve net zero in line with science.

Key Requirements:

1. Reduce at least 90% of total emissions from the baseline year before offsetting.
2. Offset no more than 10% of residual emissions, and only through verified carbon removal projects (not avoidance).
3. Include Scope 3 if it represents more than 40% of total emissions.
4. Set near-term (5–10 years) and long-term (by 2050) targets.

This standard has become the benchmark for credible corporate climate claims. Any company calling itself “net zero” without meeting these criteria risks reputational damage and accusations of greenwashing.

7. Common Challenges and How to Overcome Them

Challenge 1: Scope 3 Data Collection

Gathering supplier emissions data can be complex and resource-intensive.
  Solution: Partner with a carbon accounting provider like NCZ, which offers methodologies and engagement strategies to help suppliers report emissions accurately.

Challenge 2: Resource Constraints

Small and medium-sized enterprises (SMEs) often struggle with limited resources for carbon measurement and reporting.
  Solution: Start with a credible baseline. Using NCZ’s Gold Certification will provide this, then scale up toward full SBTi alignment.

Challenge 3: Integrating Targets into Business Strategy

Targets without internal buy-in are unlikely to succeed.
  Solution: Embed sustainability KPIs across departments and educate teams on how their actions influence emissions outcomes.

8. Benefits of SBTi Alignment

1. Regulatory and Investor Confidence
   • Aligns with frameworks like the EU CSRD, UK TCFD, and ISSB
   • Positions your company as investment-ready in an ESG-focused market.
2. Tender and Procurement Success
   • Public bodies such as the NHS and local councils now prioritise suppliers with SBTi-validated targets.
3. Operational Efficiency
   • Energy efficiency improvements and supply chain optimisation lead to measurable cost savings.
4. Brand Credibility
   • Validated targets enhance your reputation and differentiate your brand from competitors using offset-heavy strategies.
5. Employee Engagement
   • Climate-aligned values boost morale and attract younger, sustainability-driven talent.

9. How NCZ Supports Your SBTi Journey

•       Carbon Baseline Measurement: Using ISO 14064 and GHG Protocol-aligned methodologies.
•       Scope 3 Engagement and Data Collection: Supplier collaboration and value chain analysis.
•       Carbon Reduction Planning: Identifying and prioritising emission hotspots.
•       Verification and Certification: Through NCZ’s certification tiers (Blue, Silver, Gold, Platinum).

By integrating these steps, you will ensure your business not only meets SBTi requirements but also gains a competitive edge through verified, transparent sustainability leadership.

10. The Future of Science-Based Targets

As of Jan 2026, over 15,000 companies globally have committed to SBTi, representing more than one-third of the global economy by market capitalisation. The initiative is expanding into new sectors, including financial institutions, real estate, and SMEs.

Upcoming developments include:

•       SBTi for Financial Institutions 2.0 – Updating methodologies for portfolio alignment.
•       Beyond Value Chain Mitigation (BVCM) – Encouraging companies to fund climate-positive projects beyond their immediate footprint.
•       Digital reporting integration – Streamlined data submission to align with global ESG taxonomies.

SBTi’s evolution underscores that credible climate action is not static; it is dynamic, data-driven, and accountable.

Final Thoughts

The Science Based Targets initiative has become the global gold standard for corporate decarbonisation. It shifts climate commitments from marketing claims to measurable, science-aligned progress.

For businesses, especially those operating in the UK and EU, SBTi alignment is no longer optional. It is a necessity for compliance, competitiveness, and credibility.

By partnering with NCZ, your organisation can confidently navigate the complexities of SBTi: measuring your emissions accurately, setting actionable targets, and demonstrating real climate leadership.

NCZ makes sustainability measurable, manageable, and meaningful.

References

1. Science Based Targets initiative. (2024). SBTi Corporate Net-Zero Standard: Version 2.0.
2. IPCC (2023). AR6 Synthesis Report: Climate Change 2023.
3. CDP (2024). Global Disclosure Report: Trends in Climate Reporting.
4. European Commission (2024). Corporate Sustainability Reporting Directive (CSRD) Overview.
5. UK Government (2024). Streamlined Energy and Carbon Reporting (SECR) Guidance.
6. WWF, UNGC, WRI (2024). SBTi Annual Progress Report.
7. Deloitte (2025). Business Case for Science-Based Targets: Insights for UK Businesses.