Yesterday’s Science Based Targets initiative release on Scope 3 GHG emissions, as part of revisions to its Corporate Net-Zero Standard, was not what many voluntary market actors would have wished for.
A quick recap: In its Scope 3 discussion paper (available here: https://t.ly/H6l_d), SBTi provided a pathway for consideration of GHG mitigation reduction/removal units under different approaches:
(i) Use towards value chain mitigation claims
(ii) Use towards GHG residual emissions
(iii) Use in support of Beyond Value Chain Mitigation claims.
The outcome of the paper was that further work is required, and such guidance is not expected to be concluded before Q4/2025!
This does not help hashtagVoluntaryCarbonMarkets and will further delay private sector climate finance mobilisation – which we should all agree is unacceptable given the state of the hashtagClimateCrisis, with countries continually experiencing record temperatures and extreme weather events.
The lack of substantive outcomes and a robust timeline to incentivise corporate action provides a ‘canary in the coalmine’ moment for SBTi. While creating further market uncertainty, it also potentially undermines the organisation’s legitimacy and relevance to deliver sustained corporate action on climate change.
In this vacuum, government-led regulated schemes, such as CORSIA, provide much clearer policies, direction and rules of engagement that are not exposed to self-regulatory systems that lack authority and constantly fight for credibility and legitimacy.
Earlier this week, Air New Zealand announced it was withdrawing from SBTi and removing its 2030 carbon intensity reduction target. For the aviation, there are particular challenges in marrying corporate net zero targets with those mandated through CORSIA – which, unlike SBTi, establishes a legal obligation for clear and robust decarbonisation of the sector.
CORSIA is currently in its pilot Phase 1, but in 2028 will become fully operational. Countries like Brazil are already passing internal regulation to support the implementation of CORSIA, with pecuniary penalties in case of non-compliance.
Of course, the international aviation industry is not representative of the whole economic sector, and gaps still persist. But as International Carbon Action Partnership (ICAP) recently highlighted, the number of national and regional carbon pricing schemes are rapidly growing around the world.
Pedro Carvalho, Head of Policy and Markets, EcoSecurities