In 2008, the UK government passed the Climate Change Act which established a legally binding target to reduce the UK’s greenhouse gas (GHG) emissions by at least 80% below 1990 levels by 2050.
This overall objective was then divided into carbon ‘budgets’ – time frames allocated to certain reduction goals. Most recently the UK government set the fifth budget, running from 2028 to 2032, with the target of a 57% GHG reduction compared to 1990 levels.
So what role do individual businesses play?
In the UK, nearly one quarter of national emissions come from industry. At the moment, there are various mandatory compliance schemes that require businesses to measure and report their energy consumption and carbon emissions. Based on current trajectories, these schemes are unlikely be enough to meet the required reductions set out in carbon budgets. To meet long-term goals it will be necessary for businesses to go beyond legislative requirements. Part of that process involves setting carbon reduction targets that contribute to the overall national GHG emissions targets.
Science based targets (SBTs) are long-term emission reduction targets at a business level which are aligned with climate science. Setting a science based carbon reduction target can help align individual company ambitions with broader goals. The targets address what we collectively need to do to limit global temperature increases to below 2 degrees Celsius from pre-industrial levels.
The success of corporate SBTs in delivering carbon reductions to help the UK meet our national carbon target will rely on a widespread commitment from businesses to cut emissions in line with climate science. So how many of the UK’s 100 largest public companies have currently committed to science-based targets? Six. We are a long way away from reaching the level of carbon reduction commitments required.
Aren’t science based targets difficult to meet though?
SBTs can stretch your business. However, our annual Sustainability Reporting Performance of the FTSE 100 research revealed that of those companies setting SBTs, four are exceeding their aims, and the other two are on course to meet them. Compare that to the FTSE 100 as a whole where just 19% are exceeding their targets, and 35% have either missed their targets, or have not set them.
By setting SBTs, organisations are forced to establish a long-term plan to deliver against ambitious targets. This drives forward well-developed sustainability strategies and builds abilities to deliver emission reductions. Ambitious long-term targets also drive innovation, deliver cost savings, and build your company’s resilience against climate risk.
Bearing in mind that the cumulative results of current carbon and energy legislation are unlikely to achieve national GHG reduction objectives, there may be further regulatory impacts on the industry sector. Setting a science based target now will increase your resilience to new climate regulation and policies.
There is plenty of time until 2050 isn’t there?
No. To enable the UK to meet its carbon target, year on year emission reductions are needed within each budget period. The time for your company to act is now. 2015 was a common target year for many carbon reduction plans. Take this opportunity when setting new targets to ensure they are in line with climate science to achieve meaningful carbon reductions and increase resilience to future climate risks.
Read our SBT factsheet to find out more about how EcoAct can support you to set and achieve a science based emissions reduction target.