SBTi and CSRD: How science-based targets influence sustainability reporting

What is SBTi?

The Science Based Targets initiative (SBTi) is an organization that enables companies and financial institutions around the world to contribute to combating the climate crisis.

The SBTi develops standards, tools, and guidance that help companies set greenhouse gas (GHG) reduction targets aligned with climate science – with the aim of limiting global warming and achieving net-zero emissions by 2050 at the latest.

It was founded through a collaboration between the World Resources Institute, CDP, the United Nations Global Compact, and the World Wide Fund for Nature (WWF).

At the heart of the initiative are Science-Based Targets (SBTs) – clearly defined climate goals based on the latest scientific findings. They specify by how much and by when companies must reduce their emissions, and how this can be achieved using the SBTi framework. This provides a concrete and actionable path to align with the 1.5°C goal of the Paris Agreement.

What are the benefits of SBTs?

SBTs are considered “science-based” because they align with the current state of climate research and support the goal of limiting global warming to 1.5°C above pre-industrial levels.

The following applies: companies that reduce their greenhouse gas emissions (GHG emissions) in line with science not only protect the climate, but also strengthen their own business model.

SBTs offer companies a plan for a climate-compatible future - and pay off in several areas:

• they make companies resilient to new regulations,
• strengthen the confidence of investors,
• promote innovation and competitiveness,
• reduce costs in the long term,
• and demonstrate a concrete commitment to climate protection to customers who are increasingly concerned with sustainability.

In short: science-based targets ensure that sustainability is measurable - and makes economic sense.

Who should take a closer look at the SBTi?

For many companies, it is worth taking a closer look at the SBTi: as an internationally established framework, it offers a solid basis for credible climate targets. Many use the SBTi as a methodological guide, but consciously decide against making a public commitment - primarily due to the high effort and costs involved.

A formal commitment to the SBTi requires a full emissions inventory, including Scope 3 emissions, and detailed reduction plans for key categories. After committing, companies have 24 months to submit and validate their targets – without a guarantee of approval. In our experience, even companies with strong internal strategies often need over a year to complete the process.

For everyone else, the SBTi criteria still provide a valuable structure for internal orientation – even without certification.

Relation to CSRD

The CSRD does not require companies to define a 1.5°C-aligned climate target – however, it does require them to disclose whether their targets are aligned with this benchmark.

Both the CSRD and the Science Based Targets initiative (SBTi) share the goal of ambitious and transparent GHG reduction – ideally in line with the Paris Agreement. The key difference lies in their methodological approach: The CSRD defines a reporting framework, specifying what information must be disclosed about climate targets – but leaves the design and implementation largely up to the companies themselves. The SBTi, on the other hand, not only sets the target ambition but also outlines a detailed pathway – including requirements for data quality, interim targets, and Scope 3 calculations.

As a result, many organizations use the SBTi as a methodological reference to define climate goals under the CSRD – even without a formal SBTi commitment. The SBTi framework provides robust, 1.5°C-aligned benchmarks, which are helpful for internal alignment and reporting.

A formal validation, while optional under the CSRD, involves significant effort and costs – and is therefore not mandatory for compliance.

Net-Zero Guidance revisions

The SBTi is currently revising its Net-Zero Standard, with new simplifications announced – especially for small and medium-sized enterprises (SMEs). The updated version 2 is expected to be published in the first quarter of 2026.

The current draft includes the following proposed changes – which are still under review and may be adjusted before final publication:

• Mandatory short-term targets: Companies will be required to set near-term targets covering a maximum of five years. Long-term targets remain optional.
• Separate targets for Scope 1 and Scope 2: Previously, combined targets could be achieved largely through renewable electricity procurement. In the future, companies will need to take distinct action on fuel use, electrification, and clean energy sourcing.
• Mandatory location-based Scope 2 targets: Market-based reductions will face stricter quality criteria. Greater emphasis will be placed on onsite generation or power purchase agreements (PPAs) with clear additionality.
• Budget-based reduction pathways: Companies may use a budget-based approach for Scope 1 emissions, focusing on cumulative emissions rather than linear reductions. This allows greater flexibility for investment planning.
• No Scope 3 targets for mid-caps in emerging markets: According to the draft, these companies will no longer be required to set near-term Scope 3 targets. The focus will shift to operational emissions.

Until the final standard is published, companies may continue using the current guidance. Targets set under the existing framework remain valid until 2030.

SBTi in Tanso

Tanso already enables companies to define climate targets aligned with the 1.5°C and 2°C pathways. SBTs can be set in the reduction module and tracked along the SBTi-paths. Measures can be planned, documented, and monitored in a structured way. Tanso also supports the definition of a base year – either as a specific reference year or a period with available data for future comparisons. This meets the SBTi requirement that a base year must be defined once at the company level.

Tanso thus provides a practical way to align with science-based climate targets – without the need for immediate formal commitment.