Setting Science-Based Targets: The SBTi Process

If you've been asked to set science-based targets — by a customer, a lender, or your board — you're being asked to commit to a specific framework with specific costs, specific timelines, and specific ongoing obligations. This guide walks through what SBTi actually requires before you commit.

What SBTi is

The Science Based Targets initiative is a partnership between CDP, the UN Global Compact, the World Resources Institute (WRI), and the World Wide Fund for Nature (WWF). It validates corporate climate targets against pathways that align with the Paris Agreement (1.5°C). A target is "science-based" only if SBTi (or a comparable validator) approves it.

Thousands of companies have committed and had targets validated. The list is public on the SBTi website; investors and customers increasingly check it before commercial decisions.

The SBTi structure has four main components:

• Near-term targets — 5–10 year emissions reductions consistent with a 1.5°C pathway.
• Long-term net-zero targets — by 2050 at the latest, with the SBTi Corporate Net-Zero Standard requiring 90%+ absolute reductions and offsets only for residual emissions.
• Sector-specific guidance — including FLAG (Forest, Land, and Agriculture) for land-using sectors, and dedicated standards for financial institutions.
• Small and medium enterprise (SME) target-setting route — a simplified validation pathway for SMEs under specific size thresholds.

Should your company set science-based targets?

Decision criteria. Most companies that have been formally asked should commit; companies without specific external pressure should weigh the cost-benefit carefully.

• Stakeholder pressure. Customers, investors, lenders increasingly require it. If a major customer's procurement questionnaire asks about science-based targets, the cost-benefit shifts strongly toward commitment.
• Regulatory anticipation. CSRD requires transition plans; many regulations align with SBTi-style disclosure. Setting targets now positions you for emerging regulatory expectations.
• Internal commitment. Some boards have pre-committed.
• Resource availability. Validation requires real time and data. A first SBTi submission typically consumes 80–200 hours of working time over 6–18 months.
• Existing emissions inventory. You can't set a credible target without solid Scope 1, 2, and material Scope 3 data. If your inventory is rough, build the data foundation first.

The SBTi process step by step

What SBTi looks for in target ambition

The technical thresholds SBTi applies (these evolve — always check the current SBTi Corporate Net-Zero Standard at the time of submission):

• Near-term Scope 1+2 reductions. Typically 4.2% per year (a 1.5°C-aligned linear pathway), translating to roughly 42% absolute reduction over a 10-year near-term target.
• Scope 3 ambition. Typically 25% absolute reduction by target year for absolute targets; intensity targets evaluated against sector-specific benchmarks.
• Net-zero targets. 90%+ absolute reduction by 2050, with high-quality offsets only for residual emissions (typically the remaining ~10% that cannot be technically eliminated).
• FLAG sector adjustments. Land-using sectors face specific FLAG criteria covering land-related emissions and removals.

What it costs and how long it takes

Specific resource implications:

• Validation fee. Tiered by revenue. Small companies (under defined thresholds) pay reduced fees. Check the current fee schedule on the SBTi website at the time of submission.
• Internal time investment. Typically 6–18 months elapsed from commitment to approval. 80–200 hours of working time over the period.
• External support. Many companies use consultants for the first submission. SMEs can often DIY using SBTi tools, particularly via the SME target-setting route.

Common pitfalls

• Committing without an emissions inventory in place. You'll fail validation. Build the GHG Protocol-aligned inventory first.
• Submitting targets that don't meet ambition thresholds. Review the current SBTi criteria before drafting.
• Excluding Scope 3 when it's clearly significant. SBTi expects Scope 3 targets when Scope 3 exceeds 40% of total emissions. Token Scope 3 coverage is rejected.
• Picking a base year too far back or unrepresentative. SBTi requires the base year no earlier than 2015 and prefers recent representative years.
• Treating validation as the end goal. Annual progress disclosure and recalculation are ongoing requirements. Failure to disclose progress can lead to removal from the SBTi-validated list.

SBTi vs other target-setting approaches

Brief comparison:

• SBTi — most rigorous, most widely recognised. Scientific validation against Paris Agreement pathways.
• Race to Zero / Net Zero pledges — broader, less rigorous. Often a stepping stone to SBTi.
• Internal corporate targets — flexible but less credible to external stakeholders. Useful for pre-SBTi alignment exercises.
• Government commitments (NDCs) — apply to countries, not directly to companies.

SBTi is increasingly the credibility benchmark; most other approaches are weaker variants of the same logic. If you have stakeholder pressure to set credible targets, SBTi is usually the right answer.

How frameworks reference SBTi

• IFRS S2 — requires disclosure of climate-related targets. SBTi-validated targets are referenced as a leading example.
• ESRS E1 — requires GHG reduction targets aligned with limiting warming to 1.5°C. SBTi validation is a natural fit.
• CDP — collects SBTi target status as a scoring input.
• GHG Protocol — SBTi requires GHG Protocol Corporate Standard, Scope 2 Guidance, and Scope 3 Standard for the underlying inventory.

Where to go from here

• Setting your base year and reporting boundaries — base year decisions feed directly into SBTi.
• Calculating Scope 3 emissions — Scope 3 inventory is a prerequisite for SBTi validation when Scope 3 is significant.
• Location-based vs market-based Scope 2 — SBTi has specific renewable electricity criteria.
• The IFRS S2 framework deep page (target disclosure) and the GHG Protocol framework deep page.

If you're considering whether to commit, download the target-setting template to map your inventory, draft target ambition, and resource requirements before submitting the commitment letter.