SBTi and CSRD
SBTi (Science Based Targets initiative) validation is the most efficient pathway to satisfying CSRD's 1.5°C alignment requirement. SBTi-validated targets directly satisfy ESRS E1-4 science-alignment requirements — reducing the documentation burden significantly. Here is how SBTi and CSRD intersect.
SBTi (Science Based Targets initiative) validation is the most efficient pathway to satisfying CSRD's 1. SBTi validation directly satisfies the following ESRS E1-4 requirements:.
What SBTi validation covers for ESRS E1-4
SBTi validation directly satisfies the following ESRS E1-4 requirements:
Science alignment: SBTi validated targets are confirmed as consistent with the 1.5°C pathway by an independent body — no further documentation of alignment methodology is required. The validation reference replaces the need for internal scientific justification.
Target methodology: SBTi specifies the allowed target metrics (absolute reduction, intensity reduction with absolute supplement), target boundary (scopes covered), and minimum ambition level. All SBTi-validated targets automatically meet the ESRS E1-4 target methodology requirements.
Scope 3 coverage: SBTi requires Scope 3 targets where Scope 3 represents more than 40% of total Scope 1+2+3 emissions — which applies to most companies. The Scope 3 target must cover at least two-thirds of Scope 3 emissions. This directly satisfies ESRS E1-4 Scope 3 target requirements.
Third-party validation: ESRS E1-4 requires disclosure of whether targets have been externally validated. SBTi provides exactly this — an independent, publicly recognised validation that is referenced in the ESRS disclosure.
What SBTi does NOT satisfy: ESRS E1-1 transition plan (SBTi validates targets, not the plan to achieve them); ESRS E1-3 actions and resources (funded actions must be separately disclosed); ESRS E1-6 GHG emissions (base year and current year metrics); and ESRS E1-9 financial effects.
The SBTi validation process — timeline and requirements
For companies preparing for CSRD compliance, the SBTi timeline must be factored into the overall compliance programme:
Step 1 — Commitment (Month 1): Submit a commitment letter to SBTi — publicly committing to set science-based targets within 24 months. This is free and publicly listed on the SBTi website. The 24-month window begins from commitment date.
Step 2 — GHG inventory (Months 2–6): Complete a base year GHG inventory covering Scope 1, 2, and material Scope 3. SBTi requires a complete base year inventory before target submission. For CSRD companies, this is the ESRS E1-6 base year disclosure — the two requirements align.
Step 3 — Target development (Months 3–9): Develop near-term (5–10 year) and long-term (net zero) targets using SBTi target-setting tools. Near-term Scope 1 and 2 targets: minimum 4.2% annual absolute reduction. Scope 3 targets: cover material categories at an equivalent ambition level.
Step 4 — Submission (Month 9–12): Submit targets to SBTi with documentation. SBTi review takes 3–6 months.
Step 5 — Validation (Months 12–18): SBTi validates and publishes approved targets. From this point, the validation is referenced in ESRS E1-4 disclosures.
For Wave 2 CSRD companies with FY2027 first reports: committing to SBTi now (2026) gives 18 months for validation before the first CSRD report — achievable if the process starts immediately.
SBTi Corporate Net-Zero Standard v2.0 — what is changing
The SBTi Corporate Net-Zero Standard v2.0 is in development — with significant implications for corporate climate target-setting.
Expected changes in v2.0: Strengthened Scope 3 requirements — higher minimum coverage of Scope 3 categories and stricter near-term Scope 3 reduction ambition. Updated definition of qualifying carbon removals — stricter permanence and additionality criteria for land-based removals. Revised near-term target ambition for high-emission sectors — some sectors may face steeper required annual reductions. Updated alignment with IPCC AR6 carbon budget estimates.
For companies with existing SBTi validation: monitor SBTi announcements on transition timelines. Existing validated targets will have a transition period to the v2.0 standard — typically 2–3 years from v2.0 publication.
For companies committing now: commit under the current standard and validate before v2.0 is finalised. This provides a validated target for CSRD disclosure and a transition period to upgrade to v2.0.
For ESRS E1-4 disclosure: reference the specific SBTi standard version your targets were validated under. As v2.0 emerges, disclose your plan to transition to the updated standard — demonstrating ongoing alignment with evolving science.
Frequently asked questions
Do we need SBTi validation for CSRD compliance?
No — SBTi validation is one pathway to demonstrating 1.5°C alignment under ESRS E1-4, but not the only one. Companies can demonstrate alignment using IEA NZE sector pathways, IPCC carbon budget approaches, or other scientifically grounded methodologies. SBTi is the most widely recognised and requires least additional documentation — but it is not mandatory.
Can we submit to SBTi before completing our full CSRD materiality assessment?
Yes — SBTi target-setting is independent of CSRD materiality assessment. However, your base year GHG inventory must be complete before SBTi submission. Most companies complete the GHG inventory as part of CSRD ESRS E1-6 data collection — the two processes align naturally.
What happens to our CSRD disclosure if our SBTi targets are rejected?
Disclose the rejection and the reason — if SBTi found your targets insufficiently ambitious, this is a material disclosure under ESRS E1-4. Explain what revisions you are making and the timeline for resubmission. A rejected SBTi application with a credible improvement plan is better than no engagement with science-based target setting.