Setting Sustainability Targets
Leading organisations are now setting carbon reduction targets aligned with the latest climate science. Measuring your carbon footprint is an advantageous way to start taking a look at the overall impact your product or organisation has on the environment and society, and setting emission reduction targets, including Science-based targets.
Targets adopted by companies to reduce GHG emissions are considered “science-based” if they are in line with the level of decarbonization required to keep global temperature increase below 2°C compared to preindustrial temperatures, as described in the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC).
Carbon calculations are also necessary for sustainability target setting and strategy development. By measuring and reporting GHG emissions companies can begin to set carbon targets and put in place carbon management initiatives to reduce emissions in the future. Sustainability target setting and strategy and managerial approach development are also required in many sustainability reporting frameworks, such as Global Reporting Initiative standards.
Science-based target setting requires a quantified approach to establishing your carbon footprint and considering the opportunities for emission reductions. Measuring GHG emissions and carbon calculations, as well as assessments of the introduced measure on your emissions reduction, both become a necessary step in your sustinability activities.
Why set sustainability targets?
- To drive and increase internal innovation;
- To reduce regulatory uncertainty and resilience, as climate related regulations increase;
- Strengthen investor confidence and credibility, as their standards and risk management are increasingly linked to climate impact; and
- Improve profitability and competitiveness.
Target Setting Methods
There are currently various methods in setting sustainability targets. Perhaps the most detailed methodology released to date – and also the most commonly used – is known as the Sectoral Decarbonisation Approach (SDA). This was published in 2015 by the Science-Based Targets initiative (SBTi), a partnership between CDP, UN Global Compact, the World Resources Institute and WWF.
This methodology enables companies to set a science-based target based on the required decarbonisation trajectory of their sector, or the sectors in which they operate. This builds upon robust climate change mitigation scenarios developed by the Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency (IEA), which are based on the best available science and analysis from around the world. These same scenarios underpin national and international climate change policy decisions.
In addition, companies should follow the GHG Protocol Corporate Standard, Scope 1 & 2 Guidance, and Corporate Value Chain (Scope 3) Accounting and Reporting Standard. Recommendations are important for transparency and best practices, but are not required. The scope 3 value chain targets are generally challenging for companies. It can be an area where they either do not have good visibility and data on their impacts, or aren’t sure how to translate their ambitions into credible targets.
A key point for companies seeking to overcome this is to remember that you can’t manage what you don’t measure. Knowing where the most material impacts exist across a value chain, companies are able to put in place strategies to mitigate them appropriately.
Ecomatters supports companies in performing an initial screening of scope 3 cradle to grave (C2G) emissions across different categories, and conducts deep dives into their identified hotspots, which can provide a business with valuable insights into its supply chain and customers. Armed with these insights, a company can then start to consider how it could frame a target that is not only ambitious but also where progress can be meaningfully tracked in the future.
Figure 1: Scope 3 emissions categories of the GHG Protocol
Ecomatters has up-to-date knowledge on setting organisation specific sustainability strategies and targets. Our strategic advice, target-setting and reporting service can help you ensure that your organisation’s reporting meets regulatory requirements as well as your corporate objectives. We can help you set scientific emissions trajectories, that can be used to set long-term ambitions for carbon reduction as well as targets for shorter time horizons, such as 2025 or 2030.
We support companies in:
- Developing your sustainability strategy, setting concrete sustainability goals and implementing them
- Helping you set emission reduction targets and strategies
- Support in setting science based targets
- Developing your organisational strategy and tools towards a Carbon Neutral Transition
- Highlighting the value of your sustainable products and value chains towards your stakeholders and and customers
- Support in stakeholder dialogue for identification of material topics for your sustainability reporting
- Positively engaging your employees to reduce emissions from business travel and employee commuting
- Constructing carbon emissions abatement curve
Example of target setting
To set a carbon target we first thoroughly analyse the company profile and select most relevant measures. As an example, Science based target well below 2 degrees could look like presented in the figure below. Here we developed scenario for a specific climate target and calculated the amount of CO2 mitigation needed to fulfil it. Consequently, the selected measures are connected with the total costs per year required for the carbon reduction. This integration of carbon and economic figures helps to understand the cost and effort of achieving the selected scenario.
Figure 2: Example of science-based target setting for scenario below 2 degrees