Formal Complaint: Science Based Targets Conflicts of Interest

As an original instigator of the Science Based Targets initiative (SBTi), it deeply saddens me to report that I have submitted the below formal complaint to the SBTi Executive Board.

[Note: In light of the grossly insufficient response from SBTi, I submitted a follow-up Memorandum on 24 March 2021 — see here — and the SBTi Executive Board finally agreed to meet with me on 19 August — more than a half year after I initiated this action — with no substantive actions resulting. In February 2022, the one-year anniversary of the submission of the Complaint, with the issues still unresolved, I wrote an Open Letter to Science Based Targets Initiative Rightsholders — see here — proposing Necessary Remedies to SBTi’s Betrayal of the Public Trust. Developments since then are documented on my LinkedIn feed — see this post for links to all activity to that point. I look forward to SBTi resolving these problems.]

Dear Science Based Targets Executive Board:

As an original instigator[1] of the Science Based Targets initiative (SBTi) and a member of SBTi’s Technical Advisory Group (TAG) since its inception, I’m writing to submit a formal complaint and make a formal request for the SBTi Executive Board to investigate apparent technical shortcomings and governance lapses, and to take steps to adjudicate and resolve these issues. The issues, which other TAG members and I have been expressing concerns over since the beginning without satisfactory response, have now been validated objectively in a scientific study by Anders Bjørn and his Concordia University colleagues, which has just been published as an accepted manuscript in the peer-reviewed journal Environmental Research Letters.[2]

Specifically, Bjørn et al raise two key and intertwining technical problems: (mis)alignment with the “latest climate science” and what they call “emissions imbalances” — i.e., collective carbon footprints under- or overshooting the carbon budget — or, metaphorically, slices of the pie amounting to less or more than a single pie.

The findings of Bjørn et al point to intertwining governance concerns: potential self-dealing and conflicts of interest. These concerns arise in particular because SBTi explicitly recommends two of the seven methodologies under its purview, both of which SBTi partners had a hand in creating:

• The Sectoral Decarbonization Approach (SDA) “was developed by CDP, WRI and WWF,” according to the SBTi Foundations of Science-Based Target Setting.[3]
• The Absolute Contraction Approach (ACA) that SBTi attributes[4] to Mars, which produced the approach in collaboration with WRI.[5]

The other assessed methodologies, all of which SBTi explicitly recommends against, were created external to SBTi[6] — including the first science-based carbon metric ever created, the Center for Sustainable Organization (CSO) Context-Based Carbon Metric, which Ben & Jerry’s piloted in 2006.[7]

Bjørn et al identify a confounding irony in SBTi’s recommendations of which methods to employ:

The SBTi currently recommends ACA and SDA over the other methods (SBTi 2020c). As mentioned (Section 1), the reasoning behind this recommendation is not entirely clear, but emission imbalance appears to play a role.[8] However, our results indicate that concerns over emission imbalance should favour the CSO and SDA methods, rather than ACA and SDA (Figure 3g). [Emphasis added]

Indeed, the study states that the

CSO method, followed by the SDA method, has the overall lowest emission imbalance across all scenarios.

The SBTi Executive Committee should be very concerned about this finding on at least three fronts:

• first, the very fact that the methodology with the strongest results on emissions imbalance is actively being recommended against, while methodologies with weaker results are being exclusively recommended;
• second, that a scientific study cannot find clarity over the reasoning why these “recommendations imbalances,” as we might call them, are even instituted in the first place; and
• third, and most importantly: that the two methodologies that are exclusively recommended by SBTi are the products of SBTi partners, while the methodologies that are recommended against are all created independent of SBTi, raising significant self-dealing and conflict of interests concerns.

I should add here that several of us on the SBTi TAG have similarly been confounded over the logic behind SBTi’s recommendation anomalies, and we have engaged in good faith efforts requesting comprehensible explanations, but have met with dead ends every time we’ve pursued such answers, as the materials in the Appendix to this formal complaint demonstrate.

Moving from emissions imbalances to (mis)alignment with the latest climate science, the Bjørn et al study points out that in order for “a target to be approved by the SBTi, it should be ‘in line with what the latest climate science says is necessary to meet the goals of the Paris Agreement — to limit global warming to well-below 2°C above pre-industrial levels and pursue efforts to limit warming to 1.5°C’.”[9] They go on to state: “Strictly speaking, the SDA method is also currently not applicable with ‘the latest climate science’, since it relies on sectoral emission scenarios predating the IPCC’s Special Report on Global Warming of 1.5 °C,” or SR15 as this Special Report commonly abbreviated.[10]

This issue — that SDA relies on scenarios by third parties (namely the International Energy Agency, or IEA) — has been voiced as a concern since the very beginning of SBTi by several TAG members, including myself. Specifically, the fact that the sector scenarios have been incomplete in terms of covering all sectors that make up the global economy at various times (and indeed, the Bjørn et al study notes that SDA currently does not cover “Coal mining, oil and gas refining, [and] agriculture”) raises concern that, in lay terms, slicing the pie without knowing how big all the slices will be make it difficult if not impossible to add up to one pie.

I voiced this concern yet again at the April 2019 Technical Advisory Group meeting, when SBTi was contending with how to align with the 1.5°C IPCC target laid out in SR15. I noted that the IEA lacked sector scenarios aligned to 1.5°C, and judging from history, there would be a significant lag time before IEA could be expected to create 1.5°C sector scenarios, making it impossible for SDA to align with 1.5°C for the foreseeable future. I characterized what SBTi was asking its TAG to do in this call as “jury rigging” — i.e. trying to fix a problem in a makeshift way.[11]

To make matters worse, IEA has been critiqued[12] (including by two of the members of the SBTi Executive Board) for failing to develop robust 1.5°C scenarios after the IPCC released SR15, and when IEA released its World Energy Outlook (WEO) 2020 in October 2020, it included a 1.5°C scenario (Net-Zero Emissions by 2050, or NZE2050) that “is not a full WEO scenario and so it does not come with the full set of data that accompanies the STEPS and SDS, making it difficult to fully explore the pathway.”[13] Specifically, NZE2050 only runs through 2030 (despite its name), and IEA has opted against releasing the full data sets that would be necessary to align SDA to NZE2050. So SDA is effectively incapable of aligning with the “latest climate science” until IEA sees fit to remedy this problem.

Table 2 in the Bjørn et al study lists the “global scenario” and “temperature goal classification.” The CSO methodology, which SBTi excludes, fares best here as well, as it employs the SSP1–1.9 from Coupled Model Intercomparison Project (CMIP6) that aligns with a 1.345°C temperature goal — even more ambitious than the IPCC 1.5°C goal. The only other methodology that aligns with the “latest climate science” (i.e. SR15) is ACA, which employs with “an emission scenario envelope derived from Huppmann et al. (2018)” that aligns with a 1.5°C temperature goal.[14]

So, the Bjørn et al study finds that the strongest methodology, both in terms of emissions imbalance, and in terms of alignment to the “latest climate science,” is the CSO methodology. Therefore, SBTi now finds itself in what we might call an “inconvenient” position of recommending against the very methodology that is the most robust!

Bjørn et al note that, in order to verify their interpretations of the methodologies, they “contacted the developers.” SBTi, on the other hand, did not contact the developers of the methodologies, several of whom have sat on the SBTi Technical Advisory Group. Furthermore, SBTi did not consult its TAG over the decision to skew its recommendations in favor of SDA and ACA, and against other methodologies. This is confounding, as this could be considered one of the most consequential technical decisions made by SBTi, after all.

In the absence of a transparent disclosure of reasoning for recommendations, one can only surmise why SBTi would limit its recommendations only to two methodologies, both of which happen to have been created by SBTi partners, and why it recommends against methodologies created independent of SBTi. However, this simple observation of “recommendation imbalance” skewing toward SBTi-created methodologies must raise the question of self-dealing and conflicts of interest.

When assessing conflicts of interest, one must consider real, potential, and perceived conflicts of interest.[15] Given that I explicitly raised the question of conflicts of interest as early as 29 March 2019, and again on 6 November 2019,[16] it seems safe to confirm perceived conflicts of interest. The Bjørn et al study confirms potential conflicts of interest.

In this formal complaint, I ask the SBTi Executive Board to investigate whether SBTi is enacting real, potential, and/or perceived conflicts of interest and self-dealing, and to report back on its determination within a month’s time, providing evidence to support its determination.

I also ask the SBTi Executive Board to instruct SBTi to redesign its recommendations regime so as to remove its recommendation against use of the strongest science-based methodology in existence, both in terms of alignment with the latest climate science, and in terms of emissions imbalance, according to the Bjørn et al study.

I will end by saying that I am deeply saddened by the course of events detailed in this formal complaint, as I believe SBTi has an ethical obligation to advance the most robust solutions to the climate crisis, and the evidence shows that it is derelict in this duty. That said, as an original instigator of SBTi, I continue to have faith that SBTi will live up to the potential that was planted in that conversation between Janet and me over a beer at the Ceres Conference (documented in the first footnote) almost a decade ago.

Thank you very much for your attention.

Sincerely,

Bill Baue

[1] I engaged Janet Ranganathan of WRI as early as Spring 2012 on the Greenhouse Gas Protocol’s lack of tie-in to the climate science of the carbon budget, and continued to engage with her and Pankaj Bhatia (including traveling from Massachusetts to Washington DC specifically to meet with them both in Summer 2012) through 2013, at which point WRI convened a meeting with me, Pankaj, Mark McElroy of the Center for Sustainable Organizations, John Sottong of EPA, Marty Spitzer of WWF, and Nigel Topping of CDP, which resulted in agreement to pursue what became SBTi. I was asked to join the Technical Advisory Group at the outset, and have served on it ever since.

[2] Bjørn A Lloyd S & Matthews D (2021) From the Paris Agreement to corporate climate commitments: Evaluation of seven methods for setting “science-based” emission targets. Environmental Research Letters. Accepted Manuscript. 11 February 2021. https://iopscience.iop.org/article/10.1088/1748-9326/abe57b According to lead author Anders Bjørn, the final published version will include some minor changes, including ones resulting from conversations with Andres Chang and Chris Weber of SBTi.

[3] SBTi, Foundations of Science-Based Target Setting, Version 1.0, April 2019. https://sciencebasedtargets.org/resources/files/foundations-of-SBT-setting.pdf

[4] See the SBTi “Methods” page as recently as April 2020 (https://web.archive.org/web/20200416020800/https://sciencebasedtargets.org/methods/) when the description of the “absolute-based approach” ends: “Mars was one of the first companies to use this method to determine its science-based target” and links to Mars’ Website (https://web.archive.org/web/20190305160043/http://mars.com/global/sustainable-in-a-generation/healthy-planet/climate-action).

[5] WRI collaborated with Mars in developing this approach: Putt del Pino, S., C. Cummis, S. Lake, K. Rabinovitch, P. Reig. 2016. From Doing Better to Doing Enough: Anchoring Corporate Sustainability Targets in Science. Working Paper. Washington, DC: World Resources Institute and Mars Incorporated. http://www.wri.org/publications/doing-enough-corporate-targets

[6] SBTi recommendations are weighted against what it calls economic intensity (or more accurately economic allocation) methodologies, which includes C-FACT, CSI, CSO, and GEVA. The 3% Solution, which was created by SBTi partners CDP and WWF and others, was not assessed in the Bjørn et al study, as its target year is 2020.

[7] Ben & Jerry’s. 2006. 2006 Social & Environmental Assessment Report. https://www.benjerry.com/about-us/sear-reports/2006-sear-report#globwarmsocfootprint

[8] Bjørn et al later state: “Given these pros and cons of individual methods, the SBTi should be transparent about the reasons underlying its method recommendations.”

[9] SBTi. 2020. Science-Based Target Setting Manual. Version 4.1. April 2020. https://sciencebasedtargets.org/resources/files/SBTi-manual.pdf

[10] IPCC 2018 Global Warming of 1.5 °C eds V Masson-Delmotte et al. https://www.ipcc.ch/site/assets/uploads/sites/2/2019/06/SR15_Full_Report_Low_Res.pdf

[11] Wikipedia. Jury rigging. https://en.wikipedia.org/wiki/Jury_rigging

[12] See https://web.archive.org/web/20190517055724/https://www.iea.org/media/news/2019/JointletterIEAApril2019.pdf

[13] Simon Evans & Josh Gabbatiss, “Solar is now ‘cheapest electricity in history’, confirms IEA.” Carbon Brief. 13 October 2020. https://www.carbonbrief.org/solar-is-now-cheapest-electricity-in-history-confirms-iea

[14] Strictly speaking, the ACA is not truly a “science-based” methodology, as IPCC scenarios don’t follow straight lines. Huppmann D, Kriegler E, Krey V, Riahi K, Rogelj J, Rose S K, Weyant J, Bauer N, Bertram C, Bosetti V, Calvin K, Doelman J, Drouet L, Emmerling J, Frank S, Fujimori S, Gernaat D, Grubler A, Guivarch C, Haigh M, Holz C, Iyer G, Kato E, Keramidas K, Kitous A, Leblanc F, Liu J-Y, Löffler K, Luderer G, Marcucci A, McCollum D, Mima S, Popp A, Sands R D, Sano F, Strefler J, Tsutsui J, Van Vuuren D, Vrontisi Z, Wise M and Zhang R. 2018. IAMC 1.5°C Scenario Explorer and Data hosted by IIASA

[15] Ryerson University Research Ethics Board. 2015/2017. Guidelines for Managing Real, Potential, and Perceived Conflicts of Interest. https://www.ryerson.ca/content/dam/research/documents/ethics/guidelines-for-managing-real-potential-and-perceived-conflicts-of-interest.pdf

[16] Appendix available upon request.