How to Set Science-Based Targets for Scope 1, 2 and 3 Emissions

Author: Tobias Schultz, Manager, Corporate Sustainability.

Science-based targets (SBTs) are vital for companies seeking to help move the needle on global greenhouse gas emissions.

Setting an SBT for your organization involves developing an emissions-reduction target consistent with the world’s carbon mitigation needs in order to hold global mean temperature rise to 2 degrees Celsius above pre-industrial levels. The Intergovernmental Panel on Climate Change (IPCC) already provided the roadmap. Companies setting science-based targets are being recognized publicly for their efforts via the We Mean Business coalition.

So, how can you set an SBT for your organization? It begins by identifying your company’s emissions, considering the three scopes of emissions defined by the GHG Protocol Corporate Standard: Scope 1, 2 and 3. Your SBTs will differ in type for each scope.

For Scope 1 and 2 emissions, which are owned or controlled by your company (think: electricity and natural gas usage), receiving recognition for setting an SBT requires establishing a concrete emission-reduction target tied to what is needed for the 2-degree pathway. Scopes 1 and 2 can be considered the low-hanging fruit here, since you directly control them. You just have to set the appropriate targets and commit to them.

Companies may choose to set their SBT target using the basic levels of decarbonization the IPCC says we need by 2035 (i.e., absolute reductions of 50 percent for both CO2 and methane emissions, and 80 percent for black carbon). However, your company can set “intensity-based” targets as well, which are based upon GHG emissions per dollar of revenue.

It is also permissible to set industry-specific targets. The International Energy Agency (IEA) states that some sectors have greater responsibility to decarbonize: Service-sector buildings must decrease GHG intensity by roughly 40 percent, while a paper manufacturer, for example, must drop GHG emissions by 60 percent during the same time frame. You can set your company apart by choosing a more aggressive target.

Scope 3 emissions come from organizational operations your company doesn’t directly control, such as employee commuting and supply chain logistics. The lack of direct influence over these emissions makes them harder to reduce, so more flexibility is allowed in setting a Scope 3 SBT. While no specific quantitative target is required to claim establishing an SBT for your organization, companies are expected to set “ambitious and measurable Scope 3 targets with a clear time frame” in order to be recognized publicly by most climate groups.

In setting an SBT, we recommend exploring the feasibility of reaching a specified target level before going public. You certainly don’t want to commit to an objective that is not feasible.

This can be a learning exercise that brings concrete benefits to your organization. The deep dive required can help you answer questions such as: Where are our greatest opportunities for improvements in energy efficiencies and resulting cost savings? Including Scope 3 emissions in your target will provide valuable insights into your supply chain, your employees’ business travel, and other unanticipated emissions sources. You’re likely to uncover potential risk mitigation and cost savings otherwise overlooked.

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