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 science-based targets?

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

Companies that reduce their greenhouse gas emissions in line with science not only protect the climate. They also strengthen their own business model. SBTs give companies a plan for a climate-compatible future, and they pay off in several areas:

• They make companies resilient to new regulations.
• They strengthen the trust of investors.
• They foster innovation and competitiveness.
• They lower energy and material costs and create planning security for future carbon pricing.
• They demonstrate concrete climate action to customers who pay more and more attention to sustainability.

In short: science-based targets make sustainability measurable and economically sensible.

Which companies should consider science-based targets?

For many companies, a closer look at the SBTi is worthwhile. As an internationally established framework, it provides a solid basis for credible climate targets. Many use the SBTi as methodological guidance but deliberately decide against a public commitment, mainly because of the high effort and cost involved.

An official commitment to the SBTi requires, among other things, a complete emissions inventory including Scope 3 emissions, as well as concrete reduction projects in the most relevant categories. Companies that take this step have 24 months after committing to submit a target and have it validated, with no guarantee that it will be accepted. Our experience shows that even companies with robust strategies often need more than a year for this.

For everyone else, the SBTi criteria still offer a valuable framework for self-orientation, even without certification.

Dr. Joachim Hildebrand, Head of Sustainability and Energy Management at SWF, describes what this can look like in practice:

"Tanso covers the entire journey for us: we calculate the corporate carbon footprint and then use the reduction module to prepare our SBTi target-setting. It is especially helpful that the emissions reduction compared with the 2024 base year is displayed directly in the tool."

SBTi and CSRD: How are they connected?

The CSRD does not obligate companies to define a 1.5°C-compliant target. However, it does encourage companies to do so, since they must disclose whether their target or targets are 1.5°C-compliant.

Both the CSRD and the Science Based Targets initiative (SBTi) share the goal of reducing greenhouse gas emissions ambitiously and transparently, ideally in line with the Paris Agreement. The difference lies in the methodological approach. The CSRD sets out a framework of disclosures that need to be tied to a target, but largely leaves the design and implementation to companies. The SBTi, by contrast, defines not only the target itself but also a clear path toward it, including requirements for the data foundation and interim milestones.

Many organizations use the SBTi as a methodological framework to define their CSRD climate targets and to have 1.5°C-compliant benchmarks, even without a formal commitment to the SBTi. An official validation adds additional effort and cost, and is not strictly required for the CSRD.

SBTi Corporate Net-Zero Standard V2.0: The most important changes

The SBTi is currently revising its net-zero guidance, with a range of announced simplifications for SMEs. The new Version 2 was released on June 11, 2026.

The most important changes in the SBTi Corporate Net-Zero Standard V2.0:

• Company categories A and B: a new differentiation by company size and geographic headquarters. For most European mid-sized companies, category A applies with stricter requirements.
• Scope 1 and Scope 2 assessed separately: both scopes must be reported separately with 100% coverage.
• New materiality test for Scope 3: all categories with a share of 5% or more of total emissions must be included, instead of fixed coverage quotas.
• Mandatory transition plan: category A companies must publish an implementation plan.
• Limited assurance: external verification of the GHG inventory becomes mandatory for category A.
• Dynamic base year: no more fixed historical base year. Instead, updates take place in every target-setting cycle.
• Ongoing Emissions Responsibility (OER): a new voluntary program for remaining emissions on the path to net-zero, partially mandatory for category A from 2035 onwards.
• Effective date: February 1, 2027. Until then, V1.3.1 remains valid.

Setting SBTi targets with Tanso

Tanso's software already allows companies to define reduction targets for 1.5°C and 2°C. SBTs can be stored in the reduction module and documented along the SBTi pathways. This makes it possible to plan and track measures in a targeted way. Tanso also supports the definition of a base year, either as a specific reference year or as a period with available data used as a benchmark for future developments. This meets the SBTi requirements, which state that a base year must be defined once, company-wide.Tanso therefore offers a way to orient your strategy toward scientifically grounded target values without having to make a full commitment right away.