SBTi CRITERIA AND

RECOMMENDATIONS
FOR NEAR-TERM
TARGETS
Version 5.1
April 2023
 DOCUMENT HISTORY
Version Change/update description Date finalized Effective Dates

1.0 Original version of Science Based Targets initiative Criteria May 2015 May 2015 to
and Recommendations April 16, 2017

2.0 Updated version of Criteria and Recommendations to February 24, February 24, 2017
reflect current best practice and latest experience. 2017 to May 22, 2018

3.0 Updated version of Criteria and Recommendations to May 23, 2018 May 23, 2018 to
provide greater clarity and reflect current best practices. October 14, 2019

Guidance Supplementary guidance and clarifications to V3.0. February 28, May 23, 2018 to
for 3.0 2019 October 14, 2019

4.0 Updated version of Criteria and Recommendations to April 17, 2019 October 15, 2019
reflect current developments of climate science and best to July 14, 2020
practices. This version integrates clarifications to relevant
criteria included in Guidance for 3.0.

4.1 Updated version of Criteria and Recommendations to April 15, 2020 July 15, 2020 to
provide greater clarity and reflect current best practices. April 14, 2021

4.2 Updated version of the Criteria and Recommendations that April 15, 2021 April 15, 2021 to
includes minor wording changes to improve clarity in C4, July 14, 2022
C16-18, C23, and R10. No changes or updates to criteria
content have been made.
Additionally, the section on annual timeline of updates was
removed as it was out of date, and sections 3 and 4 have
been added from other SBTi resources to provide the
information directly in this criteria document.

5.0 Updated version of the Criteria and Recommendations that October 27, July 15, 2022 to
reflects current developments in climate science and best 2021 April 10, 2023
practices. This version integrates changes in alignment with
SBTi’s new strategy, including the integration of the Net-
zero Standard.

Science Based Targets Criteria and Recommendations TWG-INF-002 | Version 5.1 | April 2023 | 2
5.1 • Minor updates to provide further clarification and April 11, 2023 From April 11,
context to existing criteria, recommendations and use 2023
of terminology (criteria 4, 10 and 19 and
recommendation 5 and 8).
• Clarifications on exclusions, significance thresholds and
emissions coverage for scope 1, 2 and 3 targets
(criteria 5 and 6).
• Clarification that the target year criterion is only relevant
for absolute and intensity-based emission reduction
near-term targets (criterion 13).
• Revision of allowable years for assessing progress to
date: for submissions in 2023, a recent year inventory
must be provided that is no earlier than 2021 i.e.
allowable most recent years are 2021 and 2022
(criterion 14).
• Clarification in language that scope 3 physical intensity
targets (criterion 18) only needs to meet the 7%
compounded emissions intensity reduction (and can
lead to absolute emissions increase).
• Alignment of criteria 22 and 23 to the revised version of
SBTi’s policy on fossil fuel companies.
• Further guidance for mandatory target recalculations
(criterion 26).
• Revision of previous recommendation to criterion for
triggered recalculations (criterion 27).
• Inclusion of most up to date information on sector
developments and sector-specific criteria.

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TABLE OF CONTENTS
INTRODUCTION .............................................................................................................................. 5
EFFECTIVE DATES OF UPDATED CRITERIA ................................................................................ 5
NEAR-TERM SCIENCE-BASED TARGETS AND NET-ZERO TARGETS ........................................ 5
I. GHG EMISSIONS INVENTORY AND TARGET BOUNDARY ....................................................... 7
I.I Target boundary ........................................................................................................................ 7
I.II GHG coverage ......................................................................................................................... 7
I.III Scope coverage ...................................................................................................................... 7
I.IV Emissions coverage ................................................................................................................ 7
II. METHOD VALIDITY ..................................................................................................................... 9
III. EMISSIONS ACCOUNTING REQUIREMENTS ......................................................................... 10
IV. TARGET FORMULATION ......................................................................................................... 12
IV.I Timeframe............................................................................................................................. 12
V. AMBITION .................................................................................................................................. 13
V.I Scope 1 and 2 near-term targets............................................................................................ 13
V.II Scope 3 near-term targets .................................................................................................... 13
V.III Combined targets................................................................................................................. 14
V.IV Renewable electricity targets ............................................................................................... 14
V.V Fossil fuel sales, distribution, and other business ................................................................. 15
VI. SECTOR SPECIFIC GUIDANCE .............................................................................................. 16
VII. REPORTING AND RECALCULATION ..................................................................................... 17
SECTOR-SPECIFIC REQUIREMENTS .......................................................................................... 19

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INTRODUCTION
All of the criteria listed below must be met in order for target(s) to be recognized by the Science Based
Targets initiative (SBTi). In addition, companies must follow the GHG Protocol Corporate Standard,
Scope 2 Guidance, and Corporate Value Chain (Scope 3) Accounting and Reporting Standard. SBTi
recommendations are important for transparency and best practice but are not required. These criteria
apply only to companies that are not classified as financial institutions and Small and Medium
Enterprises (SMEs). Financial institutions can set targets using the SBTi criteria and guidance for
financial institutions. SMEs should use the streamlined process to set targets in line with climate
science.

The Target Validation Protocol for Near-term Targets describes the underlying principles, process,
and criteria followed to assess targets and to determine conformance with the SBTi Criteria for Near-
term Targets. The SBTi strongly recommends that companies review Table 1 in the Target Validation
Protocol for Near-term Targets that further details SBTi criteria for Near-term Targets compliance and
non-compliance before commencing target development. Furthermore, SBTi Criteria and
Recommendations for Near-term Targets Version 5.1 should be read in conjunction with the Target
Validation Protocol for Near-term Targets.

While every effort is made to keep companies informed of the latest criteria and
recommendations, the initiative reserves the right to make adjustments as needed to reflect
the most recent emissions scenarios, partner organization policies, and greenhouse gas
accounting practices.

The initiative also reserves the right to withdraw the validation of an approved target if it becomes
apparent that incorrect information was communicated during the target validation process that results
in any of the criteria existing during the assessment not being met, or if requirements following the
approval of the target are not respected (i.e., target progress reporting and recalculations).

Unless otherwise noted (including specific sections), all criteria apply to scopes 1, 2, and 3.

EFFECTIVE DATES OF UPDATED CRITERIA

This criteria version 5.1 will be in effect as of April 11, 2023. Criteria, recommendations and best
practices denoted with an asterisk (*) are refinements and additions to clarifications of pre-existing
criteria and recommendations.

NEAR-TERM SCIENCE-BASED TARGETS AND NET-

ZERO TARGETS
Sections I through to VII set out the criteria specific for near-term target setting. Companies wishing
to seek validation for near-term targets1 only may still do so, but the SBTi encourages companies
contemplating setting net-zero targets in the future to consider the implications of the formulation of
their near-term targets for long-term target setting.

1 Near-term targets were previously termed short-term targets.

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This document explains the near-term criteria, which are requirements that companies must follow,
and uses precise language to indicate requirements, recommendations, and allowable options that
companies may choose to follow.
• The terms “shall” or “must” are used throughout this document to indicate what is required for
targets to be in conformance with the criteria.
• The term “should” is used to indicate a recommendation, but not a requirement.
• The term “may” is used to indicate an option that is permissible or allowable.

The terms “required” or “must” are used in the guidance to refer to requirements. “Can” and “is
encouraged” may be used to provide recommendations on implementing a requirement or “cannot”
may be used to indicate when an action is not possible. The letter “C” preceding a number indicates
a criterion and the letter “R” preceding a number indicates a recommendation.

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I. GHG EMISSIONS INVENTORY AND TARGET
BOUNDARY
I.I Target boundary

Criteria

C1 – Organizational boundary: Companies should submit targets only at the parent- or group level,
not the subsidiary level. Parent companies must include the emissions of all subsidiaries in their target
submission, in accordance with the boundary criteria outlined below. In cases where both parent
companies and subsidiaries submit targets,2 the parent company’s target must also include the
emissions of the subsidiary if it falls within the parent company’s emissions boundary given the chosen
inventory consolidation approach.

Recommendations and additional guidance

R1 – Setting organizational boundaries: The SBTi recommends that a company's organizational

boundary, as defined by the GHG Protocol Corporate Standard, is consistent with the organizational
boundary used in the company’s financial accounting and reporting procedures.

I.II GHG coverage

Criteria

C2 – Greenhouse gases: The targets must cover all relevant GHGs as required by the GHG Protocol
Corporate Standard.

I.III Scope coverage

Criteria

C3 – Scope 1 and scope 2: The targets must cover company-wide scope 1 and scope 2 emissions,
as defined by the GHG Protocol Corporate Standard.

*C4 – Requirement to have a scope 3 target: If a company’s relevant scope 3 emissions are 40% or
more of total scope 1, 2, and 3 emissions, they must be included in near-term science-based targets.
All companies involved in the sale or distribution of natural gas and/or other fossil fuels shall set scope
3 targets for the use of sold products, irrespective of the share of these emissions compared to the
total scope 1, 2 and 3 emissions of the company.

I.IV Emissions coverage

2This criterion applies only to subsidiaries. Brands, licensees, and/or specific regions or business divisions of a company
will not be accepted as separate targets unless they fall outside of a parent company’s chosen consolidation approach.

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Criteria

*C5 – Scope 1 and 2 significance thresholds: Companies may exclude up to 5% of scope 1 and scope
2 emissions combined in the boundary of the inventory and target. Companies may exclude a
maximum of 5% of emissions from their total scope 3 inventory.3

*C6 – Scope 3 emissions coverage for near-term targets: Companies must set one or more emission
reduction near-term targets and/or supplier or customer engagement targets that collectively cover(s)
at least two-thirds (67%) of total reported and excluded scope 3 emissions considering the minimum
boundary of each scope 3 category in conformance with the GHG Protocol Corporate Value Chain
(Scope 3) Accounting and Reporting Standard.

Recommendations and additional guidance

R2 – Targets covering optional scope 3 emissions: Targets to reduce scope 3 emissions that fall
outside the minimum boundary4 of scope 3 categories are not required but are encouraged when
these emissions are significant. This can include targets to influence the behavior of end-users (e.g.,
education campaigns) or to drive the adoption of science-based targets on customers (e.g., customer
engagement targets). Companies may cover these emissions with a scope 3 target, but such targets
cannot count towards the two-thirds threshold defined in C6 for scope 3 emissions (i.e., these targets
are above and beyond the company’s scope 3 targets). For reference, consult page 48 in the GHG
Protocol Scope 3 Standard and the Target Validation Protocol for Near-term Targets for a list of
products that generate direct and indirect use-phase emissions.

3 Where a company’s scope 1 or 2 emissions are deemed immaterial (i.e., under 5% of total combined scope 1 and 2
emissions), companies may set their SBT solely on the scope (either scope 1 or scope 2) that covers more than 95% of the
total scope 1 and 2 emissions. The company must continue to report on both scopes and adjust their targets as needed, in
accordance with the GHG Protocol’s principle of completeness.
4 For a definition of the minimum boundaries of scope 3 categories and emissions sources that fall outside the minimum

boundaries, see Table 5.4 (page 34) of the Corporate Value Chain (Scope 3) Accounting and Reporting Standard.

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II. METHOD VALIDITY
Criteria

C7 – Method validity: Targets must be modeled using the latest version of methods and tools
approved by the initiative. Targets modeled using previous versions of the tools or methods can only
be submitted to the SBTi for validation within 6 months of the publication of the revised method or
sector-specific tools.

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III. EMISSIONS ACCOUNTING REQUIREMENTS
Criteria

C8 – Scope 2 accounting approach: Companies shall disclose whether they are using a location- or
market-based accounting approach as per the GHG Protocol Scope 2 Guidance to calculate base
year emissions and to track performance against a science-based target. The GHG Protocol requires
measuring and reporting scope 2 emissions using both approaches. However, a single and consistent
approach must be used for setting and tracking progress toward a SBT (e.g., using location-based
approach for both target setting and progress tracking).

C9 – Scope 3 screening: Companies must complete a scope 3 inventory covering gross scope 3
emissions for all its emissions sources according to the minimum boundary of each scope 3 category
set out by the GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard.

*C10 – Bioenergy accounting: CO2 emissions from the combustion, processing and distribution phase
of bioenergy – as well as the land use emissions and removals5 associated with bioenergy feedstocks
– shall be reported alongside a company’s GHG inventory. Furthermore, these emissions shall be
included in the target boundary when setting a science-based target (in scopes 1, 2 and/or 3, as
required) and when reporting progress against that target.

Land-related emissions accounting shall include CO2 emissions from direct land use change (LUC)
and non-LUC emissions, inclusive of N2O and CH4 emissions from land use management. Including
emissions associated with indirect LUC is optional.

Companies are expected to adhere to any additional GHG Protocol Guidance on bioenergy
accounting when released in order to maintain compliance with criterion 10.

C11 – Carbon credits: The use of carbon credits must not be counted as emission reductions toward
the progress of companies’ near-term science-based targets. Carbon credits may only be considered
to be an option for neutralizing residual emissions (see Net-Zero C28) or to finance additional climate
mitigation beyond their science-based emission reduction targets (see Net-Zero R9).

C12 – Avoided emissions: Avoided emissions fall under a separate accounting system from corporate
inventories and do not count toward near-term science-based emission reduction targets.

Recommendations and additional guidance

R3 – Biofuel certification: The SBTi recommends that companies using or producing biofuel(s) for
transport should support their bioenergy GHG accounting with recognized biofuel certification(s) to
disclose that the data on land-related emissions and removals represents the relevant biofuel
feedstock production.

5 The positive impact of exceeding zero emissions due to biogenic removals shall not be accounted for in a company’s
target formulation or as progress towards SBTs. In addition, removals that are not directly associated with bioenergy
feedstock production are not accepted to count as progress towards SBTs or to net emissions in a company’s GHG
inventory.

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R4 – Bioenergy data reporting: The SBTi recommends that companies report direct biogenic CO2
emissions and removals from bioenergy separately. Emissions and removals of CO 2 associated with
bioenergy shall be reported as net emissions according to C10, at a minimum, but companies are
encouraged to also report gross emissions and gross removals from bioenergy feedstocks.

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IV. TARGET FORMULATION
IV.I Timeframe

Criteria

*C13 – Base and target years: Absolute and intensity-based emission reduction near-term targets
must cover a minimum of 5 years and a maximum of 10 years from the date the target is submitted
to the SBTi for validation.6 The choice of base year must be no earlier than 2015.

C14 – Progress to date: The minimum forward-looking ambition of near-term targets is consistent with
reaching net-zero by 2050 at the latest, assuming a linear absolute reduction, linear intensity
reduction, or intensity convergence between the most recent year and 2050 (not increasing absolute
emissions or intensity).7

Recommendations and additional guidance

*R5 – Long-term target year: Targets that cover more than 10 years from the date of submission are
considered long-term targets. Long-term targets can only be validated in accordance with the Net-
Zero Standard Criteria.

R6 – Consistency: It is recommended that companies use the same base years for all near-term
targets.

6 For targets submitted for an official validation in the first half of 2023, the valid target years are 2027-2032 inclusive. For
targets submitted in the second half of 2023, the valid target years are between 2028 and 2033 inclusive.
7 For submissions in 2023, a recent year inventory must be provided that is no earlier than 2021 i.e., allowable most recent

years are 2021 and 2022.

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V. AMBITION
V.I Scope 1 and 2 near-term targets

Criteria

C15 – Level of ambition for scope 1 and 2 targets: At a minimum, scope 1 and scope 2 near-term
targets must be consistent with the level of decarbonization required to keep global temperature
increase to 1.5°C compared to pre-industrial temperatures.

C16 – Absolute targets: Absolute reduction targets for scope 1 and scope 2 are eligible when they
are at least as ambitious as the minimum of the approved range of emissions scenarios consistent
with the 1.5°C goal.

C17 – Intensity targets: Intensity targets for scope 1 and scope 2 emissions are only eligible when
they are modeled using an approved 1.5°C sector pathway applicable to companies’ business
activities.

Recommendations and additional guidance

R7 – Choosing an approach: The SBTi recommends using the most ambitious decarbonization
scenarios that lead to the earliest reductions and the least cumulative emissions.

V.II Scope 3 near-term targets

Criteria

C18 – Level of ambition for scope 3 emissions reductions targets: At a minimum, near-term scope 3
targets (covering the entire value chain or individual scope 3 categories) must be aligned with
methods consistent with the level of decarbonization required to keep global temperature increase
well-below 2°C compared to pre-industrial temperatures.

*C19 – Supplier or customer engagement targets: Near-term targets to drive the adoption of science-
based emission reduction targets by their suppliers and/or customers are acceptable when the
following conditions are met:
● Boundary: Companies may set engagement targets around relevant and credible upstream
or downstream categories.
● Formulation: Companies shall provide information in the target language on what percentage
of emissions from relevant upstream and/or downstream categories is covered by the
engagement target or, if that information is not available, what percentage of annual
procurement spend is covered by the target.8

8 If measuring coverage by spend, the company shall provide an estimate of the emissions coverage associated with that
spend for validation purposes to demonstrate that criterion C6 has been met, by the supplier or customer target alone or
together with other scope 3 target(s).

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 ● Timeframe: Companies’ engagement targets must be fulfilled within a maximum of 5 years
from the date the company’s target is submitted to the SBTi for a validation.9
● Level of ambition: The company’s suppliers/customers shall have science-based emission
reduction targets in line with the latest version of the SBTi Criteria for Near-term Targets.

Recommendations and additional guidance

*R8 – Supplier engagement: Supplier/customer engagement targets are required to be set in

accordance with the latest version of the SBTi Criteria for Near-term Targets. Official validation of
suppliers’ targets by SBTi are not required, though companies are welcome to encourage this if they
wish. It is recommended that suppliers/customers classified as a small- and medium-sized enterprise
(SME), submit targets through the SME streamlined route.

V.III Combined targets

Criteria

C20 – Combined scope targets: Targets that combine scopes (e.g., 1+2 or 1+2+3) are permitted.
When submitting combined targets, the scope 1+2 portion must be in line with at least a 1.5°C
scenario and the scope 3 portion of the target must be in line with at least a well-below 2°C scenario.
For sectors where minimum target ambition is further specified for companies’ scope 3 activities, C24
supersedes C20.

V.IV Renewable electricity targets

Criteria

C21 – Renewable electricity: Targets to actively source renewable electricity at a rate that is
consistent with 1.5°C scenarios are an acceptable alternative to scope 2 emission reduction targets.
The SBTi has identified 80% renewable electricity procurement by 2025 and 100% by 2030 as
thresholds (portion of renewable electricity over total electricity use) for this approach in line with the
recommendations of RE100. Companies that already source electricity at or above these thresholds
shall maintain or increase their use of renewable electricity to qualify.

Recommendations and additional guidance

R9 – Purchased heat and steam: When modeling targets using the SDA, it companies should model
purchased heat and steam related emissions as if they were part of their direct emissions, i.e., scope
1.

R10 – Efficiency considerations for target modelling: If companies are using a method that does not
already embed efficiency gains for the specific sector, market – and the decarbonization projected for

9 For targets submitted for an official validation in the first half of 2023, the valid target years are up to 2027 inclusive. For
those submitted in the second half of 2023, valid target years are up to 2028 inclusive.

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the power sector is based on a 1.5°C scenario – these factors should be considered when modeling
electricity-related scope 2 targets.

V.V Fossil fuel sales, distribution, and other business

Criteria

*C22 – Sale, transmission, distribution of oil, natural gas, coal as well as other fossil fuels: Companies
that sell, transmit, or distribute natural gas – or other fossil fuel products – shall set emission reduction
scope 3 targets for the “use of sold products” category, that are at a minimum consistent with the level
of decarbonization required to keep global temperature increase to 1.5°C compared to pre-industrial
temperatures, irrespective of the share of these emissions compared to the total scope 1, 2, and 3
emissions of the company, company's sector classification, or whether fossil fuel sale/distribution is
the company's primary business. Customer engagement targets are not eligible for this criterion.

*C23 – Companies in the fossil fuel production business or with significant revenue from fossil fuel
business lines: The SBTi will not currently validate targets for:
● Companies with any level of direct involvement in exploration, extraction, mining and/or
production of oil, natural gas, coal or other fossil fuels, irrespective of percentage revenue
generated by these activities.
● Companies that derive 50% or more of their revenue from the sale, transmission and
distribution of fossil fuels, or by providing equipment or services to fossil fuel companies.
● Companies with more than 5% revenue from fossil fuel assets (e.g., coal mine, lignite mine,
etc.) for extraction activities with commercial purposes.
These companies must follow the respective sector methodology, once published.

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VI. SECTOR SPECIFIC GUIDANCE
Criteria

C24 — Requirements from sector-specific guidance: Companies must follow requirements for target
setting and minimum ambition levels as indicated in relevant sector-specific methods and guidance –
at the latest, 6 months after the sector guidance publication. A list of the sector-specific guidance and
requirements is available below and in the Target Validation Protocol for Near-term Targets.

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VII. REPORTING AND RECALCULATION
Criteria

C25 – Frequency: The company shall publicly report its company-wide GHG emissions inventory and
progress against published targets on an annual basis.

*C26 – Mandatory target recalculation: To ensure consistency with the most recent climate science
and best practices, targets must be reviewed, and if necessary, recalculated and revalidated, at a
minimum every 5 years. For companies with targets approved in 2020 or earlier, targets must be
reviewed and revalidated by 2025, if necessary. Companies with an approved target that requires
recalculation must follow the most recent applicable criteria at the time of resubmission. A company’s
base year emissions recalculation policy must include a significance threshold of 5% or less that is
applied to emission recalculations or in the absence of a base year emissions recalculation policy, a
company must agree to apply a 5% significance threshold for emission recalculations.

*C27 – Triggered target recalculation: Targets should be recalculated, as needed, to reflect significant
changes that could compromise relevance and consistency of the existing target.

The following changes should trigger a target recalculation:

● Scope 3 emissions become 40% or more of aggregated scope 1, 2 and 3 emissions.

● Emissions of exclusions in the inventory or target boundary change significantly.
● Significant changes in company structure and activities (e.g., acquisition, divestiture, merger,
insourcing or outsourcing, shifts in goods or service offerings).
● Significant adjustments to the base year inventory, data sources or calculation
methodologies, or changes in data to set targets such as growth projections (e.g., discovery
of significant errors or a number of cumulative errors that are collectively significant).
● Other significant changes to projections/assumptions used in setting the science-based
targets.

C28 — Target validity: Companies with approved targets must announce their target publicly on the
SBTi website within 6 months of the approval date. Targets unannounced after 6 months must go
through the approval process again unless a different publication time frame has been agreed in
writing with the SBTi.

Recommendation and additional guidance

R11 — Where to disclose: There are no specific requirements regarding where the inventory and
progress against published targets should be disclosed, as long as it is publicly available. The SBTi
recommends disclosure through standardized, comparable data platforms such as CDP’s climate
change annual questionnaire, though annual reports, sustainability reports and the company’s
website are acceptable.

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R12 — Validity of target projections: The SBTi recommends that companies check the validity of
target-related projections on an annual basis. The company should notify the SBTi of any significant
changes and report these major changes publicly, as relevant.

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SECTOR-SPECIFIC REQUIREMENTS
Sector-specific guidance and methods are currently available for many sectors. All new, sector-
specific guidance that becomes available will be uploaded to the sector guidance page on the SBTi
website. The SBTi has sector-specific requirements related to the use of target-setting methodologies
and minimum ambition levels for near-term target setting. The eligible methods set out in Table 1
below concentrate on scope 1 and 2 near-term targets, unless otherwise specified.

Table 1 Sector-specific requirements for near-term targets

Sector Eligible methods Guidance and further notes

When setting SBTs, companies can Guidance is being developed for the
Aluminium set targets using the cross-sector aluminium sector and is currently in the
pathway (absolute targets only). scoping phase.
When setting SBTs, companies can Optional guidance is available for
Apparel and footwear set targets using the cross-sector companies in the apparel and footwear
pathway (absolute targets only). sector.
For all transport-related emissions
across all sectors, companies should
report these emissions on a well-to-
wheel (WTW) basis in their GHG
inventory (well-to-wake for aviation). For
When setting SBTs, companies aviation this is the sum of both scope 1
providing air transport services can emissions from jet fuel combustion and
set targets using the physical scope 3 category 3 “fuel- and energy-
intensity convergence method using related activities” emissions from
the pathways available in the SBTi upstream production and distribution of
Aviation tool. The target boundary jet fuel.
Aviation
must cover well-to-wake emissions
(WTW), as specified in the SBTi Aviation target formulation and
Aviation Guidance. Alternatively, communication must explicitly state that
when setting SBTs, companies can targets are exclusive of non-CO₂ factors.
set targets using the cross-sector Targets must include a footnote stating
pathway (absolute targets). that non-CO₂ factors which may also
contribute to aviation-induced warming
are not included in this target and
whether the company has publicly
reported or commits to publicly report its
non-CO2 impacts.
Real Estate Investment Trusts (REITs)
When setting SBTs, companies in
wishing to set targets must specify if they
these sectors are recommended to
are a mortgage-based or equity-based
set absolute targets or intensity
REIT. Equity REITs must pursue the
Buildings targets using the residential
regular target validation route for
buildings pathway, service buildings
companies. Mortgage REITs must
pathway, or cross-sector pathway
instead utilize the Financial Institutions
(absolute targets only).
guidance for setting SBTs.

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 Please note scope 3 must include The SBTi is developing guidance for
emissions from use of sold products companies operating in the built
for architecture/design firms environment.
When setting SBTs, companies are
recommended to set absolute or The SBTi has released guidance to aid
Cement intensity targets using the cement companies in the cement industry in
pathway, or cross-sector pathway setting science-based targets
(absolute targets only).
The SBTi is developing guidance for
companies in the chemicals sector.

Companies that produce or sell fluoro-

When setting SBTs, companies can gases (or products that use HFCs) must
Chemical set targets using the cross-sector account for and report emissions during
pathway (absolute targets only). the use of these gases in cooling
units/refrigerants or in industrial
applications in their GHG inventory
under scope 3 category 11 “use of sold
products”.
Sufficient ambition if in line with the
cross-sector pathway (absolute
targets only) or relevant SDA The SBTi guidance for financial
pathways (e.g., Services/ institutions outlines in detail the target
Commercial buildings). setting requirements for setting both
scope 1+2 and scope 3 targets for
Financial Institutions investment and lending activities.
Sector-specific criteria and methods
are available for financial
institutions to align their The SBTi also has separate guidance
investments and lending with Paris- developed for private equity firms
aligned climate stabilization
pathways.
Companies with significant FLAG The following companies are required to
emissions are required to set set FLAG targets:
targets (see criteria in the next table 1.) Companies with FLAG emissions that
column). These are separate from total 20% or more of overall emissions
their SBTs that cover all non-FLAG across scopes.
emissions. FLAG targets must use 2.) Companies in the following sectors:
Forest, Land and the FLAG-sector pathway (absolute • Forest and Paper Products–
Agriculture (FLAG) targets) or a commodity pathway Forestry, Timber, Pulp and
(intensity targets). Paper, Rubber.
• Food Production– Agricultural
Commodity pathways are available Production.
for 11 commodities: beef, chicken, • Food Production– Animal
dairy, leather, maize, palm oil, pork, Source.
rice, soy, wheat, and timber and • Food and Beverage Processing.

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 wood fiber. Companies in the forest • Food and Staples Retailing.
products sector are required to use • Tobacco.
the commodity pathway for timber
and wood fiber.
Please see the FLAG Guidance.

The FLAG target must cover at

least 95% of FLAG-related scope 1
and 2 emissions. The FLAG target
must cover at least 67% of FLAG-
related scope 3 emissions. Please
see the FLAG Guidance for further
guidance and criteria.
Fossil Fuel
Sale/Transmission/ Targets must be set for scope 3 category
Distribution* In addition to following the guidance 11, irrespective of the share of these
for the primary sector, companies emissions compared to the total scope 1,
*This information is only must set targets for scope 3 2 and 3 emissions of the company.
applicable to companies category 11 “use of sold products” Separate scope 3 targets may need to
that receive less than using absolute reduction aligned be set in this case. Companies with more
50% of their revenue with at least 1.5°C ambition than 50% of their revenue from fossil fuel
from fossil fuel sale, thresholds. sale, transmission, or distribution cannot
transmission, or officially validate targets at this stage.
distribution.
The SBTi guidance for ICT companies
When setting SBTs, companies in including mobile networks operators,
Information and
these sectors must use the cross- fixed networks operators and data
communication
sector pathway (absolute targets centres operators outlines in detail the
technology providers
only). target setting requirements for setting
scope 1 and 2 targets.
When setting near-term SBTs,
companies in these sectors can set
targets using the cross-sector
pathway (absolute targets only).

When setting long-term SBTs, The SBTi is developing guidance for

Iron and Steel
companies in these sectors can set companies in the steel sector.
targets using the cross-sector
pathway (absolute reduction
targets) or using the long-term
sector intensity pathway (intensity
targets).
On the transport sector page, you can
Companies in Maritime Transport
find the Maritime Transport
must use the sector-specific
Maritime Transport Guidance and the Maritime
pathway.
Transport Target Setting Tool.

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 Near-term targets can be no earlier Please note that companies using this
than 2030. guidance to set near-term science-based
targets covering scope 3 emissions from
subcontracted maritime transport
All companies setting near-term
operations (e.g., cargo owners or
science-based targets covering
shippers) are not required to submit
emissions from own operations
long-term science-based targets.
(e.g., vessel owners or operators)
shall also submit long-term science-
based targets along with their near-
term target submission. For
maritime transport emissions, a
long-term science-based target
means reducing emissions to a
residual level in line with 1.5°C
scenarios by no later than 2040.
Companies in this sector include - but
are not limited to - integrated oil and gas
companies, integrated gascompanies,
exploration and production pure players,
refining and marketing pure players, oil
products distributors, gas distributors
and retailers and traditional oil and gas
service companies. Please see the Oil
and Gas sector webpage for more
information.

The SBTi is developing a new The SBTi will assess companies on a

methodology for companies in the case-by-case basis to determine sector
oil and gas sector to set science- classification for SBTi validation
based targets. Currently, the SBTi purposes. Therefore, the SBTi reserves
is unable to accept commitments or the right to not move forward with a
Oil and gas
validate targets for companies in company’s validation, until
the oil and gas or fossil fuels methods/guidance have been
sectors. Please see our policy for developed/completed.
further information and those that
are excluded from this.
About fossil fuel service companies:
Service companies are defined as
companies that support exploration,
extraction, mining or production of fossil
fuels, and other significant activities
along the fossil fuels value chain, not
covered by sale, transportation or
distribution category.

The expectation is that such companies

need to account for the indirect

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 emissions related to the fossil fuels
directly or indirectly managed by the
company.

Given the limitation of accounting

standards and target setting methods for
these sectors, the SBTi reserves the
right to not move forward with a
company’s validation. The SBTi expects
that the oil and gas sector guidance will
help inform the rules for these.

About fossil fuel assets:

Companies that have dormant or active
fossil fuel assets (e.g., coal mine, lignite
mine, etc.) for extraction activities with
commercial purposes (meaning sales),
cannot officially validate targets at this
stage, until further specific methods and
guidance.

The SBTi recommends companies to

decommission fossil fuel assets, instead
of divesting, as this approach better
reflects the need to phase-out fossil fuels
in our global economy, as science
indicates is necessary.

If a company completely
decommissions/divests from fossil fuel
assets, they will no longer be considered
under these rules, and can submit
targets as per standard route. The SBTi
recommends companies to follow the
GHG Protocol for base year
recalculations.
Please see the Power/Electric utilities
The intensity convergence method
Guidance.
must be used by power generation
companies, as specified in the
As explained in the guidance for electric
Guidance for Electric Utilities. For
utilities, power generation companies are
Power Generation power sector companies, long-term
expected to set at least two targets. The
science-based targets must reduce
first is a scope 1 target over all electricity
emissions to a residual level in line
generation modelled using the 1.5°C
with 1.5°C scenarios by no later
aligned power SDA that is expressed in
than 2040 using the Sectoral
terms of MWh energy generated. The

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 Decarbonization second is an all sold electricity target
Approach. covering the portion of scope 1 and
direct biogenic CO2 and scope 3
category 3 emissions associated with all
sold electricity. This target must also be
modelled using the 1.5°C aligned power
SDA and expressed in intensity terms.

For power generation companies that

distribute and sell fossil fuels, a third
target must be set covering 100% of
emissions from downstream use of fossil
fuels. This should be an absolute target
that aligns with a 1.5°C mitigation
pathway. In order to meet the 67% scope
3 coverage threshold, power companies
may need to set a target over other
scope 3 categories as well.
When setting SBTs, companies can Guidance is being developed for the pulp
Pulp and Paper set targets using the cross-sector and paper sector and is currently in the
pathway (absolute targets only). scoping phase.
Target setting guidance will be updated
along with sector trajectory but you can
view the transport sector guidance here.
When setting SBTs, companies can
For all transport-related emissions
Road and rail set targets using the cross-sector
across all sectors, companies should
pathway (absolute targets only).
report these emissions on a well-to-
wheel (WTW) basis in their GHG
inventory (well-to-wake for aviation and
maritime transport).
The SBTi is temporarily pausing
near- and long-term target
validations and target updates for This applies to automakers.
automakers until 1.5°C scope 3
Transport
targets for use-phase emissions Auto part manufacturers can still set
OEMs/Automakers
from new road vehicles are targets using the cross-sector absolute
developed and approved. Please reduction.
see our policy for further
information.

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