How Do I Describe My Company's Climate Change Targets in an ESG Report?

"We don't have climate targets" — a simple, trackable goal counts

When SMEs reach the climate targets section of their ESG report, it's tempting to assume this requires the kind of sophisticated, science-based commitments seen in large corporate sustainability reports — detailed Scope 3 breakdowns, supplier engagement programmes, formal net-zero pathways.

In reality, a climate target simply needs to state where you want to improve, by how much, and by when. Even a modest goal, like "switch office electricity to a renewable tariff within the next year," is a legitimate starting point.

If you already have a general sense of "we should reduce energy use" or "we should think about our business travel," you're most of the way there. The job in this section is to make that sense of direction specific and measurable.

What is this question actually asking?

This section asks for measurable climate targets, typically covering:

• Emissions reduction percentages (Scope 1, 2, and sometimes 3)
• Renewable energy adoption goals
• Energy efficiency improvements
• Net-zero commitments, where relevant

For each target, a strong answer includes:

• A specific metric
• A timeframe
• Who is accountable for tracking it

You don't need every category—focus on what's genuinely relevant and measurable given your company's size and the data you can realistically collect.

Good climate targets are measurable

The same principle applies here as with any ESG target: state what will improve, by how much, by when, and how you'll know if you've succeeded.

Compare these two statements:

"We want to reduce our carbon footprint."
(Vague — not a target)

"Achieve 100% renewable electricity across all offices by 2027."
(Measurable — a real target)

The second version gives a clear way to check progress.

Wherever possible, include:

• Percentages
• Baseline years
• Deadlines
• A named person or role responsible for tracking it

Common climate target areas

Scope 1 and 2 emissions reduction

This covers direct emissions (like company vehicles) and indirect emissions from purchased electricity and heating.

This is often the most practical starting point for SMEs, since Scope 1 and 2 data is usually the easiest to measure—utility bills and fuel receipts are a reasonably accessible starting point.

A realistic target might be a percentage reduction over several years, with a clear baseline year.

Scope 3 emissions reduction

This covers indirect emissions across the value chain, including:

• Business travel
• Employee commuting
• Purchased goods and services

Scope 3 is typically the hardest category to measure accurately, especially for smaller companies without dedicated data systems.

It's entirely reasonable for an SME to set a more modest or narrower Scope 3 target than a large enterprise—for example, focusing specifically on business travel or commuting, where data is more readily available, rather than committing to a broad percentage reduction across all Scope 3 categories before you have reliable measurement in place.

Renewable energy transition

This covers shifting electricity consumption toward renewable sources through:

• Renewable tariffs
• Direct procurement agreements
• Certified renewable contracts

This is often one of the more achievable and clearly measurable targets for an office-based SME.

A straightforward "100% renewable electricity by [year]" target is both meaningful and realistic for many small companies.

Energy efficiency improvement

This covers reducing overall energy use through:

• Equipment upgrades
• Office improvements
• Behavioural changes

A per-employee or per-office measure can work well here since it accounts for company growth over time.

Supply chain engagement

This covers encouraging suppliers to set their own emissions reduction targets.

For most SMEs, a formal supplier engagement programme covering a specific percentage of procurement spend may not be realistic to measure or manage.

A more proportionate version might be a simpler commitment, such as prioritising suppliers who can demonstrate basic environmental practices, without a precise spend-based percentage target.

Structure and accountability matter

For each target, briefly note:

• The specific metric or goal
• The timeframe (short-term, medium-term, or long-term)
• Who is accountable for tracking and reporting progress

You don't need a dedicated sustainability lead or quarterly tracking systems to have credible accountability.

For a smaller company, "our office manager reviews energy bills annually and reports informally to the team" is a legitimate and honest structure.

What matters is that someone is genuinely responsible, not that the process mirrors a large enterprise's climate governance.

Grouping targets by time horizon can also help:

Short-term

Achievable within a couple of years, like switching to renewable electricity.

Medium-term

Requiring sustained effort, like a percentage reduction in Scope 1 and 2 emissions.

Long-term

Bigger ambitions, like net-zero commitments.

Not every company needs targets across all three horizons, and a long-term net-zero commitment isn't required to have a credible climate section.

Many SMEs will have meaningful short- and medium-term targets without yet committing to a specific net-zero date.

Keep targets realistic and proportionate

It's tempting to borrow ambitious, precise-sounding targets from a large company's ESG report—a 50% Scope 1 and 2 reduction, a 30% Scope 3 reduction, supplier engagement covering 70% of spend.

These numbers only mean something if your company can actually measure and track them.

If you don't currently have reliable data on business travel emissions or supplier practices, a borrowed target risks being unverifiable rather than credible.

A better approach for most SMEs is to start with what you can reasonably measure today.

If you're tracking electricity and heating consumption, a Scope 1 and 2 target is achievable.

If you don't yet have good data on Scope 3 categories, it's more honest to set a target to start measuring a specific, manageable category (like business travel) before committing to a broad reduction percentage across the whole of Scope 3.

Avoid committing to a specific net-zero date unless there's a credible plan behind it. A vague "net zero by 2040" without supporting medium-term targets can look more like a slogan than a genuine commitment.

Common mistakes to avoid

Writing vague ambitions instead of measurable targets

"Reduce our carbon footprint" isn't a target.

"Reduce Scope 1 and 2 emissions by 50% by 2030 versus a 2022 baseline" is.

Copying precise targets you can't actually track

A specific percentage target is only meaningful if you have a way to measure progress against it.

Setting a broad Scope 3 target without reliable data

It's more credible to start with a narrower, measurable Scope 3 focus (like business travel) than to commit to a percentage across a category you can't yet measure.

Forgetting baseline years

A percentage reduction target needs a clear starting point to mean anything.

Committing to net zero without supporting targets

A net-zero date needs credible short- and medium-term targets behind it to be meaningful, not just an aspirational headline.

How Wardn helps

Wardn provides a structured template with example wording covering common climate target areas:

• Emissions reduction
• Renewable energy
• Energy efficiency
• Supply chain engagement

You can adapt the template to reflect goals your company can genuinely track and work toward.

The same structure can be reused and updated year after year, making it straightforward to show progress against previous targets as your data and ambitions develop.

Frequently asked questions

Do we need a net-zero target to complete this section?

No. A credible climate section can consist entirely of short- and medium-term targets, such as renewable energy adoption or Scope 1 and 2 reductions, without committing to a specific net-zero date.

A net-zero commitment is only meaningful with credible supporting targets behind it.

Should we set a Scope 3 target if we don't have good data yet?

You can, but it's often more honest to start with a narrower, measurable slice of Scope 3—like business travel or commuting—rather than a broad percentage reduction across a category you can't yet reliably measure.

What makes a climate target measurable rather than just an ambition?

A measurable target states:

• What will improve
• By how much or to what rate
• By when
• Who is responsible for tracking it

"Reduce emissions" is an ambition.

"Achieve 100% renewable electricity by 2027" is a target.

Do we need a sustainability lead to track these targets credibly?

No.

For a smaller company, it's entirely reasonable for an office manager or founder to informally track progress, such as reviewing annual utility bills.

What matters is that someone is genuinely accountable, not the formality of the process.

What's the most common mistake companies make with climate targets?

Copying specific, precise-sounding targets—especially around Scope 3 and net zero—from larger organisations without having a way to actually measure or verify progress against them.

It's better to set a smaller, trackable target than an impressive one you can't follow up on.

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