There are companies in Mexico and Colombia that have spent two or three years telling their European clients they are “on the way to SBTi.” When the validation team reviews the file, the problem is always the same: the Scope 3 data lives in last year's spreadsheet, Procurement never answered the supplier questionnaire, and the emissions inventory never went through an external audit.
The commitment was real. The data was not.
This situation is more common than sustainability teams admit in a meeting. And it has concrete financial consequences: without SBTi validation, sustainable debt instruments, green bonds and the preferential credit lines from CAF or IDB stay out of reach.
In this article we answer the questions that circulate most on the topic: what exactly is SBTi? how does validation work? what changed with the new V2.0 standard in 2026? why do so many LATAM companies fail to pass the committee? and what does it take to turn a commitment into a target the market recognizes?
The answer begins with a premise few say out loud: without validated SBTi targets, sustainable capital does not reach your operations.
SBTi is the global mechanism that verifies whether a company's emissions reduction targets are consistent with climate science to limit warming to 1.5°C.
It is not an image certification or a marketing seal. The Science Based Targets initiative was created in 2015 by CDP, the United Nations Global Compact, the World Resources Institute (WRI) and WWF. Today, more than 11,000 companies worldwide operate under its methodology.
Validation means the company's reduction objectives were reviewed by external experts and meet the technical criteria of the GHG Protocol across Scope 1, 2 and 3. Without that process, any decarbonization target is, in the eyes of the capital market, a stated intention.
What sets SBTi apart from any other climate commitment is that it cannot be watered down: it is not enough to declare “we will cut emissions 30% by 2035.” The target must be consistent with a verifiable scientific pathway and cover the entire value chain.
SBTi states that in manufacturing industries, Scope 3 represents on average more than 70% of the total carbon footprint. That means that without primary supplier data, there is no possible target, only an estimate shaped like a target.
In practice, the Head of Sustainability knows this. The problem is that Scope 3 data depends on Procurement, and Procurement has other priorities. The supplier questionnaire ends up answered by 15% of the base, and the inventory reaches the committee built on sector averages that no one has validated in the field.
SBTi is not an environmental certificate. It is the passport to preferential rates.
SBTi turns a decarbonization plan into a verifiable financial asset. As long as targets have no external validation, capital markets treat them as intention, not as managed risk.
SBTi states that targets must align with 1.5°C pathways or well below 2°C. That has a direct correlation with access to sustainable debt instruments: green bonds, sustainability-linked loans and preferential credit lines from the Inter-American Development Bank (IDB) or the Development Bank of Latin America (CAF). Companies with validated SBTi targets access preferential conditions on these instruments.
Global sustainable finance surpassed $1 trillion in 2023, according to BloombergNEF. LATAM captures less than 5% of that flow, despite concentrating 10% of global emissions. The reason is not only a lack of projects: it is a lack of validation. Funds need to tell a credible commitment from one that is not. SBTi resolves that asymmetry.
There is also an effect on the CDP Score. Companies with validated SBTi targets tend to earn better CDP ratings, and fewer than 2% of the companies that report to CDP reach the A level. Without SBTi, reaching that band is practically impossible.
If you have not measured Scope 3, SBTi has nothing to validate.
What you gain with validation:
What it costs you if you are not prepared:
Most of the “cons” are not about SBTi itself. They are about the lack of data infrastructure to reach it. The bottleneck is always the same: Scope 3.
Not all climate targets carry the same weight with banks, regulators and buyers. This table compares the most common approaches:
SBTi targets are the only ones that combine methodological rigor, independent external validation and explicit recognition from international financial institutions. The rest works for internal reporting or corporate communications, but it does not move the cost of debt.
Bono's infrastructure is designed to move an industrial company to the top row of this table with real data: automating supplier information collection, generating auditable Scope 1, 2 and 3 inventories, and translating that data into the format the SBTi committee needs to validate.
The SBTi validation process has three formal stages: commitment, development and submission. But before the first there is one that SBTi does not name explicitly and that consumes the most time: having the data.
Step 1: Auditable inventory before the commitment.
SBTi allows 24 months to submit targets after the commitment. That window runs out when the inventory is not ready from the start. Bono automates the collection of Scope 1, 2 and 3 data by connecting operational consumption, energy bills and supplier questionnaires in a single platform. The result is an inventory that follows the GHG Protocol and is ready for external audit before signing. We have seen that companies that start without this step lose between 8 and 14 months in corrections.
Step 2: Primary supplier data.
SBTi states that in manufacturing, Scope 3 exceeds 70% of the total footprint. Without primary data from Tier 1 suppliers, the target submitted to the committee is built on estimates that the validation team detects in the first review. Bono's infrastructure includes the Enterprise Supply Chain module, which sends structured forms to suppliers, consolidates responses and generates the data in the technical format SBTi accepts.
Without validated SBTi targets, sustainable capital does not reach your operations. The first step to avoid it is to have the value-chain figure, not to estimate it.
Step 3: Preparing the file for the committee.
The new Net-Zero V2.0 standard, published in June 2026, requires documented transition plans, annual progress reports and verifiable governance. Bono generates the technical report in the format SBTi requires, with reduction pathways calculated from the company's real data. A manufacturing company in Mexico with four plants cut its committee preparation time from 18 months to 7 months after implementing Bono's data infrastructure.
The three economies face the same pressure, but from different angles.
Mexico.
The European Union's Carbon Border Adjustment Mechanism (CBAM) applies carbon-intensity-adjusted tariffs to exports of steel, aluminum, cement and fertilizers from 2026. Mexican companies that export to Europe and do not have their emissions measured and verified are already absorbing that cost. SBTi is the most recognized way to prove that the reduction is real, not declarative. Mexico's Voluntary Carbon Market also requires verifiable metrics that SBTi makes possible.
Colombia.
Law 2169 of 2021 on energy transition sets carbon neutrality targets for 2050. The carbon tax in force already raises the cost of emissions-intensive operations. Colombian companies that export to European buyers face CSRD scrutiny, which requires their counterparties to report value-chain emissions. A supplier without auditable data falls out of that chain. SBTi gives Colombian companies the language their European buyers already demand.
Chile.
The Framework Law on Climate Change (Law 21.455) sets the carbon neutrality target at 2050. The carbon tax in Chile is $5 USD per tonne of CO2 emitted. CORFO Verde offers preferential financing lines for decarbonization projects, with eligibility criteria that depend on verifiable data. A validated SBTi target is the technical argument that opens those lines.
SBTi validation turns your decarbonization plan into a financial asset, in all three countries.
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Today it is not mandatory in any LATAM country. But the European CSRD requires companies reporting under that standard to request emissions data from their suppliers. SBTi is the reference those companies use to assess how serious a supplier is. If you export to Europe or supply a multinational, the pressure has already arrived indirectly.
SBTi allows 24 months from signing the commitment to submitting targets. The real time depends on the state of the emissions inventory. Companies with Scope 1, 2 and 3 measured and auditable can submit in 8 to 12 months. Those that start the inventory after the commitment rarely finish on time.
For most manufacturing companies, yes. SBTi requires including it when it represents more than 40% of total emissions, and SBTi states that in manufacturing it exceeds 70% on average. In practice, without supplier data, the target is not valid. Bono automates exactly that value-chain data collection.
V2.0 marks a fundamental shift: commitment alone is no longer accepted. SBTi now requires documented transition plans, verifiable annual progress reports and stronger internal governance. Targets submitted under V1.3 remain valid until the end of their time horizon. Those submitted from 2026 onward must meet the new criteria from the start.
Every quarter without validated SBTi targets is costlier capital, contracts you do not win and preferential credit lines that end up in the hands of a competitor that does have the data.