The Science Based Target Initiative has been created by 4 organisations: DP, WWF, the World Resources Institute, and the World Business Council for Sustainable Development.
In the Paris Agreement, national governments committed to limit temperature rise to well below 2 degrees Celsius (°C) and pursue efforts to limit temperature rise to 1.5°C. Beyond these thresholds, the world will increasingly experience dangerously elevated amounts of sea-level rise, droughts, flooding, and other extremes. Despite the efforts of governments and other actors, total anthropogenic GHG emissions continue to increase. Under current trajectories, global mean temperatures are projected to increase by 3.7 to 4.8°C by the end of this century. Even under existing country-level commitments, emissions levels in 2030 will be 24 to 60 percent higher than they should be under least-cost 2°C scenarios (UNFCCC Secretariat 2016).
Companies have a pivotal role in ensuring that the global temperature goals are met, but most existing company targets are not ambitious enough. The majority of global GHG emissions are either directly or indirectly influenced by the corporate sector. Many companies, recognizing the risk climate change poses to their business and the opportunity it creates for leadership and innovation, have already committed to change by setting emission reduction targets. Yet, to date, most companies’ targets have been incremental and do not match the ambition and timelines consistent with a 2°C future.
SBT’s represent a more robust approach for companies to manage their emissions over the long haul. SBT’s are grounded on an objective, scientific evaluation of what is needed, rather than what is achievable by any one company. And they offer a firm foundation for organizations’ long-term climate change strategies, boosting companies’ competitive advantage in the transition to the low-carbon economy. Targets are considered “science-based” if they are in line with the level of decarbonisation required to keep global temperature increase below 2°C compared to pre- industrial temperatures.
Companies are increasingly adopting SBTs, although uncertainty exists regarding best practices. Over 350 multinational companies have already set an SBT and over 850 have committed to set an SBT in the near future through the Science Based Targets initiative. Because setting SBTs is an emerging practice, considerable uncertainty exists amongst companies around the benefits of settings SBTs, what kind of target may constitute an SBT, and best practices for both gaining internal support for SBT adoption and communicating SBTs to external audiences.
The Verified Carbon Standard was developed for exclusive use on the voluntary market. Designed by the Climate Group and the International Emissions Trading Association (IETA), it aims to create a new trading unit called a Voluntary Carbon Unit (VCU). Best practices from the existing market place were brought together, such as the additionality and baseline principles of the CDM, and the accounting principles of the GHG protocol for Project Accounting.
The CDM Gold Standard is built on the basis of the CDM standard, but includes an additional focus on sustainable development contribution and the Sustainable Development Goals (SDGs). The GS is operated by the Gold Standard Foundation, established in 2003 by a group of NGOs led by WWF. All approved projects are registered in the Gold Standard online registry, to ensure a transparent chain of ownership that does not allow double counting, carbon leakage and other credibility issues that need to be monitored to ensue credible & sustainable climate action.
The Clean Development Mechanism (CDM) and Joint Implementation (JI) standards provide rules for baselines, additionality, monitoring, reporting, verification, and certification of project-based emission reductions. CDM is created for projects in developing countries, while JI is intended for projects in developed countries. Projects intended to generate compliance credits (called Certified Emission Reductions or CERs) need to comply with the CDM/JI standard, governed by the Independent Executive Board of the United Nations Framework Conference on Climate Change (UNFCCC).
The CERs can also be bought for voluntary purposes. The certificates are recorded in an international registry system, with unique serial numbers, making each CER traceable to the project through which it was generated. The market credibility of these standards is high, but transaction costs are high as well, which limits adaptation to medium or large projects.
The integrity of offsetting has become a big issue after reports of fraud and abuse involving the (compliance) carbon market. So it is crucial to ensure that offsetting actually provides the desired environmental benefits – also to avoid any reputational risk associated with the use of poor quality offsets. Several standards have been established to guarantee the quality of a certain offsetting credit. They can be subdivided in standards for the compliance market and standards for the voluntary market.
The OEF is a multi-indicator measure created by the European Commission’s Joint Research Center (JRC). This measure provides you with an overview of the environmental performance of your organisation’s goods and services from a life cycle perspective. The OEF can be used by all types of companies, public administrative entities, territories, and other bodies.
Unlike a carbon footprint, which measures only one thing, an environmental footprint is a useful multi-indicator measure of your impacts. The PEF is a methodology created by the European Commission’s Joint Research Center (JRC) based on Life Cycle Assessment. Its goal is to provide ‘a common way of measuring environmental performance’ for companies within in EU wishing to market their product.
Bilan Carbone® is a diagnostic tool developed by the French Agency for Environment and Energy Management (ADEME) in 2004. It is an accounting method for greenhouse gas emissions which can be used by any organisation, industrial or tertiary company, public administration, communities or territory. It is the best-known and most used system in France for the evaluation and reduction of greenhouse gas emissions.
The Greenhouse Gas Protocol is an international accounting tool for governments and business leaders to understand, quantify, and manage greenhouse gas emissions. It was established by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) in 1998 and first published in 2001. The protocol served as the foundation of several international standards, including ISO 14064-1.
The Publicly Available Standard 2060 (PAS 2060) is the newest recommended standard for CO2 neutrality, launched by the British Standards Institution (BSI) in 2010. It offers a successful set of measures and requirements for organisations to make a verifiable and transparent declaration of their carbon neutrality. The standard makes it easier to compare company efforts and to overcome public cynicism about the term.