Submitting Scope 1, 2 and select Scope 3 as an FI

Our company (an FI) would like to submit a science-based target for review. Our original idea was to submit a Scope 1, 2 and select Scope 3 (travel) target but upon reading the Financial Institution guidance, we would need to include Scope 3 (investments and lending) emissions in our target This will be very difficult for us. Is it possible to just submit the Scope 1, 2 and select Scope 3 target without the Scope 3 investments and lending, and still have it validated by SBTi?

Hi @mattgunness and welcome to the community,

Apologies for the late response.

No, that is not possible under SBTi for Financial Institutions. Most financial institutions emissions primarily come from scope 3 and in particular investment and lending portfolios. This is why investment and lending portfolios are in focus for SBTi for Financial Institutions. Hence, financial institutions need to set targets for all asset classes included in the guidance table 5.2 (p 55-57).

As some assets classes and sectors are currently harder to set targets for than others, e.g. due to data limitations, there are different levels of coverage required for different asset classes and sectors, and you can use different methods to achieve the required targets. You see the asset classes, coverage required and methods allowed in table 5.2 in the guidance (p 55-57).

For instance, one of the methods’ (Portfolio Coverage) only data input is if a company has an SBTi-approved SBT or not, which you can easily find in the Companies Taking Action table (or from select data providers). This should be relatively straight forward to calculate. This method then requires the FI to set an interim target (next 5 years) that is aligned with achieving 100% portfolio coverage by 2040, at the latest.
This is one example of how financial institutions can set targets despite data limitations.