Science-based targets for nature “provide value in the form of risk mitigation” as well as “improved reputation and competitive advantage”, according to pilot companies ahead of the Science-based Targets Network (SBTN) concluding the test in May.
Another pilot company commented it was “an enormous step forward” toward a standardisation of how nature is integrated into companies’ strategies.
Some 17 companies representing sectors and supply chains significantly impacting nature joined the pilot scheme in May 2023 to help determine the optimal balance between the target’s rigor and feasibility. To date, the pilot companies have contributed a total of over 20,000 data points to the project.
“Science-based targets for nature aim to set the bar for ambitious and measurable corporate action on nature. Insights gained from SBTN’s corporate pilot program have been invaluable in helping us manage the optimal balance between rigor and feasibility, ahead of a broader roll-out to more companies later this year,” said Erin Billman, executive director at SBTN.
“We are calling on all companies to prepare to set science-based targets for nature, which will equip them with the necessary guardrails to know they are taking enough of the right actions, in the right places, at the right time across their value chains. The benefits of doing so can go beyond risk management, with some pilot companies reporting that the target-setting process has helped raise their sustainability ambitions and gain easier access to financing.”
Billman concluded: “There is no net zero without credible action on nature. As the window shortens to reverse climate change, companies must increase action to protect nature and put it at the heart of corporate decision making. The business case for taking integrated action to address nature and climate together has never been clearer.”
Insights
One of the key insights from pilot companies was the value they place on the science-based target for nature as a risk management tool to increase resilience, but also the opportunities beyond this.
GSK shared the scientific approach that SBTN brings has deepened their understanding of the organisation’s impacts and dependencies on nature, and helped to refine and prioritise the action they are taking to meet their existing nature targets – what they describe as a testament to the “immense value of the framework”.
Pilot companies also held an appreciation of the interoperability of SBTN with other related sustainability initiatives, with Alpro emphasising its alignment with the Taskforce for Nature-related Financial Disclosures (TNFD).
Additionally, companies acknowledged the pilot’s impact on their nature ambitions, and felt encouraged to expand their scope of measuring their environmental impacts from solely direct operations to include upstream.
Conor McMahon, global net zero and nature lead at Nestle, said: “Piloting science-based target for nature has helped us identify areas where we can strengthen our existing climate focused initiatives, such as our forest positive and regenerative agriculture programs, to better respond to nature-related risks and opportunities across out value chain.”
Finally, companies were also able to report measurable benefits from the use of the targets for nature, uncovering hidden risk within the supply chain and acting in locations where it really matters.
For example, one company discovered an issue with the use of herbicides within a specific basin, adversely impacting water quality. As the scope of freshwater quality targets expand in the future, the company will be able to set a science-based target to address this issue. In the meantime, they are taking steps to collaborate with suppliers to mitigate this negative impact.
Challenges
However, pilot companies also identified some challenges when aligning with the SBTN’s targets for nature, with investors increasingly expecting companies to take ambitious measures to mitigate their impact on nature.
According to the SBTN, the methods aim to find the equilibrium between what is currently feasible for companies and what will elevate the level of ambition of action for nature. Striking this balance remains an ongoing challenge that requires continual optimisation.
An example of this challenge, highlighted by the pilot, is the necessary place-based emphasis of science-based targets for nature, and therefore the need for upstream traceability. Companies face obvious challenges to get full visibility, with data collection and data quality presenting notable hurdles.
Another challenge is in having a critical number of employees with relevant professional skills, such as lifecycle assessment, spatial analysis and environmental data analysis. SBTN are preparing additional resources to support companies through the onboarding journey, with the forthcoming Corporate Manual considered a key resource.
Looking ahead
Pilot companies will submit their targets for validation by 1 March 2024, with the first validated targets to be published before the end of June alongside a detailed report outlining key learning and insights from the pilot.
The SBTN said that, in anticipation of the broader roll-out, they will continue their collaborative efforts to further align with other related sustainability frameworks including TNFD, while, in 2025, companies should expect additional coverage of science-based targets for nature. This will include the first ocean targets as well as expanded targets on freshwater pollution and land.