More and more companies are joining the fight against climate change by committing to adopt a science-based emission reduction target to limit the increase in global average temperature to below 2 degrees Celsius (3.6 degrees Fahrenheit). This commitment is part of an initiative, named Science Based Targets, led by the World Wildlife Fund, CDP (formerly the Carbon Disclosure Project), the World Resources Institute, and the United Nations Global Compact. According to CDP, more than 80 percent of the world's 500 largest companies established emission reduction or energy-specific targets in the 2014–15 financial year; however, thus far, only 65 companies have made the science-based target commitment.

Under the initiative, "[t]argets adopted by companies to reduce GHG emissions are considered 'science-based' if they are in line with the level of decarbonization required to keep global temperature increase below 2˚C compared to preindustrial temperatures, as described in the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC)." CDP has identified at least two methodologies available to companies to support them in setting these targets. One is the "Sectoral Decarbonization Approach," which "divides the annual global GHG emissions budget at the sector- and then company-specific level by calculating each company's share of total sector activity and determining their individual emissions budgets." The other is the "3% Solution," which is "based on the idea that U.S. corporations should cut their carbon emissions by about 3 percent each year to achieve the 2020 carbon reductions scientists say are needed."

Science Based Targets identifies several benefits to companies that make the commitment, including: (i) building credibility and reputation, (ii) saving money and increasing competitiveness, (iii) driving innovation, and (iv) influencing and preparing for shifting public policy. One company, for example, that committed to reduce the carbon footprint of its manufacturing 25 percent by 2020 over a 2002 baseline has already cut its energy use and saved $425 million in avoided energy costs. Also, another company that researched the 3% Solution methodology estimated that companies could save up to $190 billion in 2020, if followed.

Leaders of the initiative hope to have 100 companies signed on by year's end, ahead of the UN Climate Change Conference in Paris in December 2015. They hope to have 250 companies with science-based targets by 2020. Companies interested in potentially making the commitment can learn more here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.