Key takeaways:
- SBTi’s new CEO stresses the need for flexibility in target-setting methodologies.
- Corporations shouldn’t wait for the new Corporate Net Zero Standard methodology to set emissions reduction goals.
- Climate transition plans will become a critical component of the target-setting process.
The Science Based Targets initiative’s new CEO, former EY sustainability consultant David Kennedy, said the nonprofit must evolve to recognize “pragmatic” approaches for corporate emissions reductions as it finalizes extensive revisions to the Corporate Net Zero Standard.
Kennedy officially joined SBTi in early April, after being named as the new CEO in early January. He boasts three decades of experience in developing net-zero strategies within government and the private sector, especially those related to food systems.
While Kennedy is in “listening and learning” mode during his initial days as CEO, he offered initial impressions and hints about his priorities during an April 9 webinar convened to field questions about the proposed new standard published March 18. SBTi is accepting feedback on the revisions until June 1, as part of public consultations and an online survey.
“We have to be science based, but we can be more pragmatic and more action focused,” Kennedy said. “We need to be a listening organization; we need to be building relationships.”
New political and economic reality
The Corporate Net Zero Standard revision comes at a fragile moment. While most corporations remain “committed and determined” to reduce emissions, the mood has shifted because of the U.S. political situation and some will find it “very difficult” to meet their original reduction targets set for 2030, Kennedy said.
SBTi must find ways to reward action even when companies fall short of the goal, he said, noting: “It’s more clear as we move to implementation just what the challenges are.”
Kennedy highlighted several proposed evolutions in the methodology that he said should benefit corporate practitioners, including:
- A defined process to assess progress and gaps at the end of a target cycle
- The decision to let corporations set separate targets for Scope 1 (their own operations) and Scope 2 (purchased electricity and energy)
- A proposal to require corporations to submit a climate-transition action plan after having targets validated
Companies should not wait for the new standard, which won’t be finalized until late 2026. SBTi will offer a transition path and there “will be mechanisms to align with the next cycle,” Kennedy said. “Get on with acting and driving down your carbon footprint.”
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