Decoding Sustainability: GHG Protocols, SBTI, and TCFD Simplified

14 Sept

As the clamor for sustainable business practices grows louder, so does the lexicon of acronyms that come with it. If you've ever found yourself puzzled by terms like GHG Protocols, SBTI, or TCFD, you're not alone. Here's a concise guide to demystify these buzzwords and understand their distinct roles in the ESG landscape.

1. GHG Protocols:
The Greenhouse Gas Protocol (GHG) serves as the foundation. Think of it as the ruler by which companies measure their carbon footprints. Developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), the GHG Protocol provides standards and tools for companies to quantify and manage their greenhouse gas emissions. This is vital as businesses strive to understand their environmental impact and begin the journey to reduce it.

2. SBTI - Science Based Targets initiative:
With a grasp on what they're emitting, companies then look for a benchmark or a goal - this is where SBTI comes in. The Science Based Targets initiative provides a framework for corporations to set meaningful reduction targets that are in line with what science says is necessary to prevent dangerous climate change. Instead of arbitrary or random goals, SBTI ensures that businesses are aligning their targets with the Paris Agreement’s aim to limit global warming to well below 2°C above pre-industrial levels.

3. TCFD - Task Force on Climate-related Financial Disclosures:
Last but certainly not least, TCFD is about honesty and transparency. Initiated by the Financial Stability Board, TCFD assists businesses in evaluating and disclosing the financial risks and opportunities related to climate change. It’s not just about understanding your emissions or setting targets; it’s about communicating these to stakeholders in a transparent manner, ensuring they're informed about the company's climate-related risks and how they're being managed.

In summary, while GHG sets the stage for measurement, SBTI ensures businesses aim for the right targets, and TCFD ensures that they're transparent about it. Together, they form a trio of tools and guidelines that pave the way for businesses to become more sustainable and responsive to the challenges of climate change. Embracing these frameworks is not just good for the planet, but also for future-proofing businesses in an increasingly environmentally-conscious global market.