Investment firm NBIM advises SBTi to focus on straightforward strategies
Norges Bank Investment Management (NBIM), the investment manager for the Norwegian government pension fund with a total value of $1.7 trillion, has expressed support for the Science Based Targets initiative's (SBTi) net zero standards as part of its broader climate responsibility framework.
In a recent response to a consultation about SBTi's net zero standards, NBIM emphasized the need for credible targets, robust verification, and enforcement mechanisms, as well as careful scrutiny of carbon credit use. The investment manager also suggested that the current guidance, which exceeds 100 pages, presents a "significant barrier to adoption".
NBIM's 2025 Climate Action Plan articulates a commitment to drive portfolio companies toward net zero emissions by 2050, requiring them to set science-based short-, medium-, and long-term targets that cover Scope 1 (direct), Scope 2 (indirect from purchased energy), and material Scope 3 (value chain) emissions. They actively engage with companies to adopt credible transition plans and integrate climate considerations into investment decisions.
Regarding carbon credits, NBIM has not expressed opposition to their use but has emphasized that they must represent "additional and verified emission reductions". The investment manager also seeks to influence market standards and collaborate with other investors and stakeholders, which likely includes promoting rigorous verification and enforcement of net zero commitments.
The SBTi Financial Institutions Net-Zero Standard, newly finalized in 2025, includes requirements addressing fossil fuel activities and deforestation exposure, with clear steps to cease new fossil fuel financing—measures NBIM likely supports based on its climate goals.
NBIM also advised SBTi to prioritize the widespread adoption of net zero standards and suggested that auditors, investors, regulators, and civil society may be better suited to assess performance and hold companies accountable to the targets they set. The investment manager cautioned SBTi against expanding its remit to include the verification and enforcement of these targets.
The Science Based Targets initiative (SBTi) is a body that sets standards for net zero emissions targets for companies. SBTi has become a key benchmark for corporate net zero commitments, with over 4,000 companies having adopted its standards. The ongoing consultation remains open until 1 June, and NBIM's advice is among the considerations being reviewed.
- Recognizing the significance of environmental science in addressing climate change, Norges Bank Investment Management (NBIM) suggested that the Science Based Targets initiative (SBTi) should prioritize the widespread adoption of net zero standards, encouraging auditors, investors, regulators, and civil society to hold companies accountable for their targets.
- In the process of driving portfolio companies toward net zero emissions by 2050, NBIM's business strategy involves taking a proactive role in influencing market standards, promoting rigorous verification and enforcement of net zero commitments, and collaborating with other investors and stakeholders, including advocating for the use of carbon credits that represent additional and verified emission reductions.
