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SBTi controversy; here’s our take

The SBTi, often regarded as the "Gold Standard" for carbon reduction, recently faced internal upheaval and external criticism following a controversial announcement.

Matt from Carbon Responsible's Team

Matt Paver

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This announcement proposed supporting publicly condemned carbon offsets to meet escalating reduction pressures, rather than prioritising higher-impact and direct reduction initiatives.

What Happened on April 9th 2024?

The controversy began when SBTi’s board announced their intention to revise their corporate net-zero standard in 2024, marking a shift in their position on using environmental attribute certificates (Carbon Offsets) to mitigate Scope 3 emissions.

While SBTi’s recent statement suggests that such certificates could be a valuable tool alongside robust policies, it triggered a backlash from employees. They publicly criticised the statement, calling for retractions and the dismissal of SBTi’s CEO and supportive board members, alleging a breach of governance protocols and a misrepresentation of company opinion.

In response, SBTi clarified that no immediate changes to the standard had been made. They announced an upcoming review in July 2024, emphasising that any use of offsets must adhere to standard procedures and be backed by evidence. This attempt to assuage concerns underscores the intense scrutiny and internal discord within the organisation.

Why is this contentious?

Offsetting has recently become a sustainability taboo, with public condemnations highlighting its unregulated, opaque, and inconsistent nature. SBTi has established itself as the gold standard of carbon reduction initiatives by prioritising genuine emission reductions over avoidance. They advocate for action within operations and value chains, rejecting the notion of purchasing one’s way out of climate obligations. Allowing corporate signatories to offset emissions within their significant sphere of influence raises concerns, potentially undermining their ‘Science based’ approach”.

Where do Carbon Responsible stand?

From our perspective, we’ve always maintained a firm stance on offsets. We believe they introduce unnecessary corporate risks and shift focus away from critical reduction methods that could significantly reshape company operations, improving efficiency and readiness for evolving economic challenges.

Offsets impede progress, relying heavily on unregulated projects often inaccurately represented in carbon disclosures. Their inherent lack of regulation and consistency poses significant corporate risks and detracts from meaningful change efforts. Redirecting funds towards sustainable business operations would yield far greater benefits.

 

What’s Next if Offsets are adopted into the SBTi Mantra? 

It’s hard to predict exactly what will happen, but opinions are clearly divided.

Many believe that if the decision moves forward, SBTi may lose numerous signatories. As inclusion deviates from perceived good governance and weakens the science-based robustness of the organisation, it marks a step backwards in corporate climate action.

Others welcome this change, seeing it as a potential catalyst for significant shifts in how companies establish decarbonisation targets. They view it as an opportunity for certain industries to adopt the ‘gold-standard’ of target setting, previously unattainable due to industry complexity and value-chain considerations.

Is this a step in the right direction, fostering inclusion and embracing a necessary tool for reduction? Or are we regressing as reductions become more challenging?

Useful resource: A Guide to the Science Based Targets Initiative

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