Hundreds of companies have set “net zero” targets for greenhouse gas emissions. But some of those pledges are arguably greenwashing—some oil companies, for example, plan to reach net zero for their own operations, but not for the emissions from customers burning their fuel. Other companies haven’t set dates for reaching the goal, or have deadlines far in the future and no plan for getting there. Others rely heavily on carbon credits to offset their emissions while they keep polluting.
A new standard from the Science Based Targets initiative (SBTi) spells out what companies need to do to have a target that’s actually compatible with global climate goals. The group saw a clear need to make sure that pledges are meaningful. “A lot of companies are setting net zero targets that are truly transformational targets, that basically will take the company into a decarbonized business model,” says Alberto Carrillo Pineda, managing director and cofounder of SBTi. “But then other companies are setting net zero targets where basically it’s business as usual. The company may continue to increase their emissions. And then they rely either on carbon accounting tricks, or on offsetting.”
To get certified through the organization’s new Net Zero Standard, companies have to include all of their emissions in their goal, including the pollution that happens in the supply chain or when customers use or throw out products. Companies have to set a goal to cut emissions drastically—by 90% to 95%, or even more for some sectors—by the middle of the century, using offsets for only the small portion of emissions that remain.
They also have to set strong short-term goals. “Whenever these targets are framed as long-term targets, more than 10 years, [we assess whether] these targets have interim milestones, and these milestones are consistent with the long-term goal of reaching net zero emissions and with limiting warming to 1.5 degrees [Celsius],” he says. Companies also have to commit to disclose their progress every year, and review their targets every five years. The standard adds onto the certification that SBTi already offers, which looks at whether companies’ short-term goals are in line with what science says is necessary to avoid the worst impacts of climate change.
A handful of companies have already been certified through a pilot program that tested the new standard, including Ørsted, a Danish energy company, which was once focused on fossil fuels, but is now phasing out coal and moving to 100% clean energy by 2025. After some more tweaks to the standard’s protocols this year, the team will begin certifying other companies in early 2022.