Who Is Setting Science Based Targets?

Science based targets (SBTs) are often considered the “gold standard” when setting emission reduction targets and getting targets verified by the Science-Based Target initiative (SBTi) has increasingly become part of many organizations’ sustainability work. But adoption is not evenly distributed across the corporate landscape.

To understand trends in target setting, I analyzed companies in the SBTi dataset with near-term and net-zero targets to understand:

·         What types of companies are setting these targets

·         Where they are located

·         Which sectors are represented

·         What target years they have chosen

The results show that certain markets, sectors, and company types are leading adoption. For sustainability leaders considering SBTs, these patterns may offer useful insights into where peer adoption is strongest and how companies are approaching target setting.

Key takeaway 1: Near-term targets extend beyond large companies

Number of science-based targets set (near-term targets on the left and net-zero targets on the right) by region

Near-term target setting is done by companies of all sizes. Small and medium enterprises (SMEs) account for slightly more than half of companies with near-term targets, while larger corporate organizations make up the remainder. Net-zero targets, on the other hand, tend to be set by larger companies - nearly three quarters of companies with net-zero targets are classified as corporate organizations (which have over 500 employees).

For smaller companies considering an SBT, the growing number of SME target setters provides useful evidence that target setting is not exclusively a large corporate practice. However, longer term net-zero commitments may be harder for smaller companies to set (due to a number of reasons, including constraints on time and resources to achieve a more difficult targets, additional SBTi fees and verification processes to set net-zero targets, etc.).

Key takeaway 2: Europe is leading adoption

Number of science-based targets set (near-term targets on the left and net-zero targets on the right) by company type

Nearly half of companies setting near-term targets are based in Europe, followed closely by companies in Asia. The geographic concentration is even stronger for net-zero targets. Nearly two thirds of companies with net-zero targets are based in Europe, compared with less than one fifth in Asia.

This concentration in Europe may be the result of a number of factors, including stronger climate regulations, investor expectations, more advanced corporate climate strategies, etc. Target setting (particularly in the near-term) is also accelerating in Asia, as climate regulations are being implemented in a number of countries and investor and public expectations are growing. For companies in these regions, setting SBTs may be necessary to stay competitive. For companies in other regions, such as North America, SBTs are not yet common practice, and companies that choose to set them may have an opportunity to differentiate their sustainability work by setting verified targets.

Key takeaway 3: SBT adoption is concentrated in a small group of sectors

Number of science-based targets set (near-term targets on the left and net-zero targets on the right) by top 10 sectors

Professional services, electrical equipment, software, food and beverage, and construction and engineering are among the sectors with the largest numbers of target setters. The top ten sectors account for roughly 60% of companies with both near-term and net-zero targets.

Interestingly, there’s a healthy mix of service-based companies (professional services and software) alongside more emissions intensive industries (such as construction). Service-based companies often don’t have a lot of direct emissions and instead have a large percentage of their footprint in their value chain. Companies with significant value chain emissions who are considering SBTs may look to some of these sectors as leading examples.

Key takeaway 4: Target years are most commonly 2030 and 2050

Number of science-based targets set (near-term targets on the left and net-zero targets on the right) by selected target year

Not surprisingly, the target years selected by companies have consolidated around two key years: 2030 for near-term targets and 2050 for net-zero targets. These are big milestones in many government climate strategies and/or climate regulations, so it makes sense that companies may try to align their targets to these years (plus they are nice easy years for communication in ESG reports!). A smaller group of more ambitious companies have focused on 2040 as a net-zero target year – only a handful of organizations attempt net-zero emissions any earlier.

Companies may decide to align to these years when setting targets to make it easier for external stakeholders, such as investors, to compare targets between peers. However, the appropriate target year selected should ultimately depend on a company's emissions profile, sector, starting point, reduction opportunities, and ability to implement its strategy. In addition, it should be noted that because companies need to set near-term targets at least five years out, 2030 is no longer a viable target year for companies who haven’t set targets yet.

What does this mean for companies considering an SBT?

Analyzing what companies are setting targets may help those considering targets understand whether SBTs are being best practice in their region or sector. For example, European organizations or companies providing professional services may want to set SBTs just to stay competitive.

For others, such as companies in North America or in less represented sectors like aerospace, mining, or utilities, setting SBTs offer an opportunity to differentiate from peers. And smaller companies may want to stick to setting near-term targets for now, letting larger companies tackle the more difficult net-zero commitments (note that the newer version of the SBTi standards released in 2026 will require setting both types of targets when it takes effect in 2028).

The companies leading SBTi adoption are helping establish a new reference point for corporate climate ambition. Understanding who those companies are can help others decide whether, when, and how to take the next step.