Setting science based targets as a mid-market company
As the importance of sustainable practices continues to grow, mid-market companies are increasingly committing to Science-Based Targets (SBTs) to help combat climate change. By aligning with the Paris Agreement’s goal of limiting global warming to 1.5°C, these companies not only reduce their environmental impact but also realize operational and competitive advantages. Here’s a step-by-step guide to getting started with SBTs.
Key Steps to Setting Science-Based Targets
Commitment: Start by formally committing to the Science Based Targets initiative (SBTi) through a letter of intent, demonstrating your company’s intention to contribute meaningfully to climate goals.
Target Development: Work closely with the SBTi to develop specific, measurable targets based on scientific criteria. Establishing a baseline is essential for identifying key focus areas and allowing for accurate tracking and improvement.
Submission for Validation: Once the targets are developed, submit them to the SBTi for validation. Note that due to the high interest in SBTs, there may be delays, so early planning is advisable.
Stakeholder Communication: Upon validation, share the targets with internal and external stakeholders to foster transparency and ensure alignment across the organization.
Disclosure: Finally, publicly disclose the validated targets to build credibility, strengthen stakeholder trust, and encourage accountability.
Benefits of Implementing SBTs
Setting Science-Based Targets brings numerous advantages for mid-market companies, including:
Enhanced Accountability: Clear targets provide measurable benchmarks, enhancing accountability within the organization.
Competitive Advantage: Demonstrating a commitment to sustainability can help differentiate your brand in a crowded market.
Risk Mitigation: Reducing emissions can help mitigate regulatory and financial risks associated with climate change.
Operational Efficiencies: The process often reveals opportunities to improve efficiencies, which can drive cost savings.
Employee Engagement: Many employees value working for organizations committed to sustainability, improving retention and morale.
Industry Dialogue: As more companies prioritize sustainable practices, being proactive can be an advantage in supplier and partner selection.
Tips for a Successful Journey
Engage a Consultant: Technical guidance can be invaluable for navigating the process, ensuring that targets are achievable, and identifying areas for improvement.
Centralize Data Collection: Streamline data collection and maintain a centralized repository to ensure data integrity, which is essential for accurate tracking and transparent reporting.
Exercise Patience: The SBT-setting process can be lengthy, and perseverance is key. Both internal alignment and the SBTi validation process take time, so plan accordingly.
Monitor Growth: If your company’s emissions grow by more than 5% above baseline levels, consider re-baselining to stay aligned with the targets.
Case Study: GreenTech Solutions’ Journey
GreenTech Solutions, a pseudonym, a mid-sized provider of eco-friendly manufacturing solutions, recently had its Science-Based Targets validated after a year-long journey. To support their goal of reducing emissions, GreenTech engaged a sustainability consultant who provided the necessary technical guidance and helped set ambitious yet achievable targets. They collected comprehensive data across their operations, establishing a 2019 baseline.
With targets to reduce Scope 1 and Scope 2 emissions by 40% and to cut Scope 3 emissions by 25% by 2030, GreenTech has made a significant commitment to sustainability, aiming to reach net-zero by 2045. The journey also enhanced employee engagement as team members became increasingly involved in sustainability efforts. GreenTech is now viewed as a sustainability leader in its sector, gaining new clients and partners attracted to its green credentials.
Why Science-Based Targets Matter
Setting SBTs is a crucial step for mid-market companies looking to future-proof their operations and actively contribute to a sustainable world. By committing to clear, science-based goals, companies not only contribute to a healthier planet but also strengthen their market position, reduce operational risks, and foster a culture of responsibility and engagement.
As more businesses take on this challenge, the impact will be collective. For mid-market companies, setting SBTs is not just an environmental choice; it’s a strategic decision that can drive long-term growth and resilience in an evolving world.
