Recently, just in time for the COP27 conference, Leverage officially joined the Science Based Targets Initiative (SBTi) to work together to reduce greenhouse gas emissions. As of November 22, 2022, a total of 4,060 companies and financial institutions around the world have applied to join SBTi, and the scientific carbon targets of 1,957 companies have been officially recognized by SBTi. Among them, there are 121 enterprises in mainland China, and 44 enterprises have officially recognized the scientific carbon targets of SBTi, and Leverage is one of them.

Leverage promises to achieve a 42% reduction in Scope 1 and Scope 2 emissions in line with the 1.5°C development trajectory in 2030, and achieve a net 95% reduction in Scope 1, Scope 2 and Scope 3 emissions in line with the 1.5°C development trajectory in 2035 Zero emission goal. This move fully demonstrates Leverage's leadership in the fight against climate change and its ambition to continue action to reduce emissions.

SBTi (Science-Based Targets Initiative) is a global initiative jointly launched by the Center for Global Environmental Information (CDP), the United Nations Global Compact (UNGC), the World Resources Institute (WRI) and the World Wide Fund for Nature (WWF). It can improve the ambition of enterprises, and promote enterprises to adopt more active emission reduction actions and solutions, and jointly cope with global climate change.

Setting science-based carbon targets through SBTi helps businesses identify the necessary reductions their businesses need to meet the Paris Agreement's goal of limiting warming to 1.5 degrees Celsius, thereby achieving their own carbon neutrality goals.

The benefits of enterprises joining SBTi are mainly reflected in two aspects: business and brand value. First, science-based carbon targets lay a solid foundation for a company's long-term climate change strategy and can enhance its competitive advantage in the transition to a low-carbon economy. According to the latest research results of the Science-Based Carbon Targets initiative, the establishment of science-based carbon targets by enterprises can help enhance brand reputation, improve investor confidence, and meet regulatory requirements. It is also conducive to driving internal innovation within the company, helping companies save costs and enhance corporate competitiveness, etc. .

In the future, with the changes of some key influencing factors, the development of scientific carbon targets will also be of great significance to more Asian enterprises. For example, the continuous expansion and tightening of carbon border regulation mechanisms in European and American countries, the development of domestic carbon policies, and the growing sustainable awareness of domestic consumers are all linked to SBTi, which requires enterprises to plan in advance. Understand the basis of their own emissions, and formulate emission reduction targets and paths in line with enterprise development.

The Science-Based Carbon Targets initiative aims to promote companies and financial institutions to set carbon emission reduction target frameworks based on climate science and align with the global temperature control goals of the Paris Agreement. This will benefit from:

Enhance Brand Reputation

One of the most important business interests has more credibility with stakeholders.

Enhance Confidence for Investors

Companies with SBTs tend to be less risky for long-term investments because they can demonstrate that their planning is based on the latest available science.

Enhance Business Resilience and Corporate Competitiveness

Setting scientific carbon targets requires companies to refocus on the low-carbon economy, take advantage of opportunities other than cost savings and avoid the risk of stranding assets.

Promote Innovation Drive

Science-based targets incorporate a long-term vision, so companies take the long-term view beyond the limitations of common greenhouse gas reduction solutions. New technologies and new financing options are likely to emerge in the corporate environment, with a focus on preparing for the arrival of a low-carbon economy.

Cost Saving

It helps companies to realize the simplification and efficiency of business operations, thus saving costs for enterprises.

Meet Future Regulatory Requirements

Science-based targets can help businesses adapt to changing policies and send a stronger signal to policymakers, enabling businesses to exert greater influence over policy decisions. Enterprises have set science-based carbon targets. Once the government intensifies climate action in the future, enterprises can better deal with its regulation and adjustment.

The process for standard enterprises with more than 500 employees to apply to join SBTi is as follows:

Step 1: Submit the Letter of Commitment for Signing

The letter of commitment states that the company will strive to set science-based emission reduction targets or have targets that have been set independently verified.

Step 2: Develop a Science-Based Target

Once a business has signed a commitment letter, it will have up to 24 months to develop, validate and submit a SBT.

Step 3: Submit for Target Review

After the target is set, the enterprise needs to fill in the science-based carbon target submission form. The SBT management team will verify the plausibility of the target against the SBT criteria and inform the company if the target has been formally approved or additional amendments are required.

Step 4: Declare Your Goals

After confirming that the target of the enterprise complies with the SBT standard, the enterprise and its target will be publicized on the official website of the SBT.

Step 5: Disclosure

Companies should disclose their emissions on an annual basis and monitor progress against targets. Disclosure channels include: CDP, corporate annual report, sustainable development report and company website.

For SMEs with less than 500 employees, the application process is faster.

First, register online, fill in basic information and select emission reduction goals. Second, by filling out the form and signing the terms and conditions, the business needs to commit to:

01 To achieve the selected targets within the specified time frame in accordance with the provisions of the Greenhouse Gas Protocol;

02 Measure and reduce Scope 3 emissions in accordance with the "Corporate Value Chain (Scope 3) Accounting and Reporting Standard" of the Greenhouse Gas Protocol;

03 Publicly report on an annual basis your corporate Scope 1 and Scope 2 GHG inventory and progress against published targets.

Successfully setting scientific carbon targets can greatly improve the reputation of sustainable development of enterprises; SBTi advocates new technologies and new thinking that are innovative, more efficient, and more environmentally friendly. There is a great opportunity to innovate and help companies save costs and help companies avoid potential regulatory and business risks, and even stand out in the market and enhance competitiveness; in the process of setting carbon targets, companies can systematically monitor and track the environment and related economic performance, so that long-term operation of the enterprise is healthier.