On April 9th 2024, the SBTi Board of Trustees released a statement suggesting it would let companies use carbon credits, against scope 3 emissions reduction targets. While this decision is a major departure from pre-existing SBTi policy and could jeopardize the integrity of “science-based targets” (SBTs), reactions from the SBTi Staff and advisory group members show expert groups were not consulted and governance rules were not followed. Reclaim Finance is deeply concerned about this development and calls on the SBTi Board of Trustees to immediately retract this statement.
In a statement released on April 9th, the SBTi Board of Trustees notes that “the use of environmental attribute certificates for abatement purposes on Scope 3 emissions could function as an additional tool to tackle climate change” and says that the “SBTi decided to extend their use for the purpose of abatement of Scope 3 related emissions beyond the current limits”.
This statement challenges the current SBTi policy regarding carbon credits. Today, carbon credits are strictly excluded from short and middle term targets and can only be included into long-term “net zero” targets to offset residual emissions (up to 10% of emissions). This is to ensure emissions reductions are prioritized and not transferred, but also recognizes that offsets have frequently failed to deliver and that there have been frequent scandals concerning failed schemes (1).
Reactions from SBTi Staff and some Technical Advisory Group (TAG) and Scientific Advisory Group (SAG) members show key internal bodies were not consulted, and standard internal processes were not followed. This constitutes a direct breach of SBTi’s governance processes, meaning that the Board of Trustees abused its authority. As a result, several members of the TAG raised the alarm and could reconsider their involvement if the Board does not retract its statement.
This statement could lead to a critical change to the way in which companies set decarbonisation targets. It should not have been made without consulting the very groups and bodies that were set up to ensure the scientific integrity of the SBTi. If it is not retracted by the Board then I cannot continue to work with the Technical Advisory Group. I will not be part of a standard-setting process that is a potential cover for a greenwashing operation.
Paul Schreiber, Senior Policy Advisor of Reclaim Finance and TAG member
Strict limitations on the use of carbon credits in targets have long been an important characteristic of SBTs and contributed to the SBTi’s credibility. They are justified by an overwhelming body of scientific evidence and ensure companies do not use carbon credits instead of reducing their greenhouse gas emissions. The SBTi’s criteria have largely been replicated by major international initiatives working on target setting and transition planning, including the UN HLEG recommendations, ISO Net-Zero and EU ESRS (2).
Over the years, the SBTi’s strict limitations on the use of offsets in decarbonization targets have become the norm. Even the initiatives designed to jumpstart the carbon credit market have not shaken this scientific pillar. So why is the Board of Trustees undermining its own credibility?
Paul Schreiber, Senior Policy Advisor of Reclaim Finance and TAG member
The statement by the Board of Trustees appears to reject the work published by SBTi on “Beyond Value Chain Mitigation” (BVCM) (3). This work sets out clear guidance on the potential use of carbon credits by companies, while keeping decarbonization targets intact, and was the result of internal and external consultations and scientific research.
