Why You Should Consider Using Science Based Targets for ESG Reporting
We have reached a point of no return when it comes to climate change, and every company, organization, institution, city, and country have to join hands to overcome global warming. The earth’s surface has been warming rapidly, and the Paris Conference on Climate Change of 2015 indicates that we have to keep the level below two degrees Celsius above the pre-industrial levels. For businesses and companies, the task is to cut down emissions, adopt sustainability and accurately report to stakeholders.
There are a number of frameworks that you can use for ESG reporting, but one of the most preferred options is the science based targets (SBT). Here are the main reasons why you should consider using this framework.
What are Science Based Targets?
These are goals developed by a company to provide a clear route for cutting down greenhouse gas (GHG) emissions. Targets are considered science-based if they are drawn in line with what climate science considers necessary to achieve Paris Agreement targets.
Science based targets are developed to achieve the following aims:
- Defining and advancing the best practices in addressing climate change.
- Offering technical assistance and expert resources to businesses and financial organizations that set science-based targets.
- Pooling together experts in offering independent assessments of efforts adopted by companies in addressing global warming.
- Steering the campaigns for reducing global warming to less than 2.0°C at the pre-industrial levels.
What are the Main Steps in Setting Science Based Targets
To set your targets, here are the five main steps to follow.
- Commit: This involves crafting a letter and sending it to demonstrate your intent to set clear science-based targets.
- Develop: You receive the SBTi’s criteria and set your company’s emission reduction targets.
- Submit: SBTi will review your targets and validate them.
- Communicate: At stage four, you are required to involve stakeholders by informing them.
- Disclose: Implement your strategies for emission reduction, track progress on an annual basis, and report annually.
Special Benefits of Using Science Based Targets
The most notable benefit of using science based targets is compliance. As more countries, from the UK to New Zealand, move to install laws, rules, and policies to fast track emission reduction, SBTi can help you with compliance. For example, you will be able to demonstrate your efforts and achievements towards cutting down emissions so that your company gets approved for listing on NYSE or LSE.
Here is a summary of other benefits that you should expect from using science based targets:
- Improved brand reputation: As consumers increasingly become cognizant of the impacts of their choices on the environment and society, most of them prefer to work with responsible, ethical, and sustainable brands. SBTi will cast you in a positive way so that more stakeholders will want to be associated with you.
- Greater investor confidence: When you set science-based targets and craft strategies to achieve them, investors will be able to evaluate and make the right decision to invest with the company.
- Resilience against future challenges: The core goal of SBTi is to ensure that your company can make forecasts and achieve two things: cut down emissions and set strategies for success. Therefore, the targets help to redefine resilience to ensure that your company can weather future risks, threats, and policy changes for success.
As you can see, science based targets provide an excellent method of redefining company operations. It allows companies to flexibly set the targets they want to achieve and create the right path to their destination. Remember that to be able to gather data, analyze it and report correctly; you should also pick an appropriate sustainability reporting software. Visit Diginex.com for all the assistance you need for sustainability management and reporting.