Achievable and ambitious GHG reductions

Many businesses promise to reduce their greenhouse gas emissions, but only the most serious are committed to doing so in line with SBTi criteria. This organization uses science to help companies set targets that are both achievable and ambitious.

More and more companies are announcing reductions in their greenhouse gas (GHG) emissions or committing to carbon neutrality. The challenge is to sort out the serious players from those who are just paying lip service.

Fortunately, for the past ten years or so, independent international organizations have been able to assess companies’ climate commitments and the actions they are taking to honor them. One of these is the Science-based targets initiative (SBTi).

A guarantee of credibility

Founded in 2014, this charity was born out of the work of four groups dedicated to defending the environment: the World Resources Institute, the World Wildlife Fund, the Carbon Disclosure Project and the United Nations Global Compact.

Well-known in the environmental community, SBTi is a major player in the fight against climate change. Its role is to help companies wishing to reduce their GHG emissions to set targets compatible with the Paris agreements. Basically, the cuts they announce must 1) contribute to limiting global warming to 1.5 ⁰C and 2) enable the achievement of global carbon neutrality by 2050.

SBTi has no coercive power: it is on a purely voluntary basis that companies decide to follow its recommendations. To date, over 6,000 companies worldwide have taken the plunge. About 150 of them are based in Canada, including McCain, Agropur, General Motors Canada, Cogeco and Desjardins.

In concrete terms, SBTi produces a host of highly detailed, science-based reference documents to guide companies towards reductions that are both achievable and ambitious.

First step: a rigorous inventory

The organization’s first requirement is that the business carry out a GHG inventory. It must be based primarily on GHG Protocol norms. GHG Protocol is an American organization whose GHG accounting standards are the most widely used in the world.

Its protocol for GHG inventories is extremely rigorous. For example, it takes into account GHGs emitted directly by a company’s factories or offices, as well as those emitted upstream, by the production of the raw materials it purchases. For example, a cheese manufacturer’s GHG inventory must include the GHGs emitted by its delivery trucks and the GHGs due to the manufacture of the milk it processes.

Quality data

The GHG Protocol requires data of the highest possible quality, that is to say: complete, accurate, relevant, consistent and transparent. Nothing less! Obviously, the ideal is to use actual measurements, but these are often difficult to obtain, or even impossible to find.

The GHG Protocol therefore accepts that businesses estimate their GHG emissions using scientific databases, mathematical models or information from other companies. It then uses precise criteria to assess the quality of these estimates. For example, the GHG Protocol gives a good rating to an estimate based on a recent reference or to data from the same territory as the company completing a GHG inventory, and a poorer rating to old data from a different country.

Step two: credible yet ambitious targets

Once its inventory is completed, the company moves on to the second stage: choosing the actions that will enable it to reduce its emissions by 4.2% each year. The aim is that all its actions contribute to limiting global warming to 1.5 ⁰C, as established in 2015 by the Paris Agreement.

SBTi does not accept that the actions planned in the short term include offset credits, i.e. the purchase of reductions achieved by other organizations or companies. According to SBTi, such credits could have the effect of “hindering the [companies’] transformation towards carbon neutrality”.

In addition, the organization asks for additional reductions from a dozen or so sectors with particularly high emissions, such as aluminum smelters, cement plants and transportation.

Special requirements for FLAG companies

One of these specific sectors includes companies whose activities depend heavily on forests, agriculture or land. These include the timber and mining industries, residential construction, agri-food processing and agriculture. This category is called FLAG, for forests, land and agriculture. It emits 22% of the world’s GHGs. After energy, it represents the largest source of GHGs on the planet!

SBTi requires companies in the FLAG category to reduce their emissions by at least 72% by 2050. It also requires them to implement measures conducive to carbon sequestration, such as ecosystem restoration, improved forest management and agri-environmental practices. Finally, SBTi requires these companies to cease all deforestation activities by 2025 at the latest.

Some businesses fall into this category because of their suppliers. This is the case for agri-food processors, among others, because they source from farms.

SBTi recommends even more specific actions for these companies. For example, to work with their existing suppliers to help them reduce their GHGs, rather than changing them for suppliers who are already performing well. Indeed, SBTi’s aim is not to help companies tick boxes on a form, but rather to help them fundamentally change their practices and business model so that global warming does not exceed 1.5 ⁰C. Simply replacing suppliers meets this objective more or less!

Fortunately, some FLAG-categorized companies, such as Saputo or General Mills, accept these constraints. At present, the two major agri-food processors are working with dozens of farms in their value chain, as part of the Dedicated Dairy Farms program.

The aim is to help farms implement agri-environmental practices that emit less GHG or capture more carbon. This collaboration is ushering in a new, more equitable and sustainable relationship between farms and their buyers.

Step three: Make a public commitment

Once a company has drawn up its game plan, it submits it to SBTi for validation. Once validated, the company’s reduction targets are published on SBTi’s online dashboard. Updated weekly, the dashboard confirms whether the company is on course. If not, SBTi indicates that it has withdrawn its commitment.

Finally, SBTi asks companies to publicize their climate commitments themselves, for example, by publishing them on their website or in their annual report. The intention here is to make it easy for anyone to check whether or not they are meeting their climate commitments.

In short, SBTi is an important link in the fight against climate change. Active right from the start of the process, it supports businesses to ensure that their GHG reduction targets are science-based, achievable, ambitious and public. Then it’s up to companies to honor their commitments in order to do their bit for the climate and… preserve their reputation!