SBTi updates net-zero standard

The Science Based Targets initiative has published Version 2.0 of its Corporate Net-Zero Standard, revising the framework used by companies to set climate targets and increasing expectations around implementation, transparency, and progress reporting.

The new standard, released on 11 June, updates the corporate climate framework first launched in 2021. SBTi says the revised model reflects differing business contexts while maintaining alignment with climate science.

The updated standard places greater emphasis on delivery. Target setting remains central, but companies are expected to show how targets are being implemented, where barriers exist, and how progress is being managed over time.

Key features include a clearer hierarchy that prioritises direct emissions reductions across operations and value chains, alongside additional recognition for companies taking action on ongoing emissions. The standard also introduces “best efforts” target setting, under which companies remain expected to use available levers while being transparent about implementation barriers and mitigation steps.

Companies can begin submitting targets for validation under Version 2.0 in the first quarter of 2027. Organisations already working towards targets under Version 1, or renewing targets in the near term, should continue using the current Corporate Net-Zero Standard Version 1.3.1. Version 1 will remain open for target submissions until the end of 2027.

The update follows two rounds of public consultation, pilot testing, expert working group input, approval by SBTi’s independent Technical Council, and adoption by its Board of Trustees. SBTi says the standard builds on more than a decade of experience supporting over 11,000 companies to set science based targets.

The revised framework arrives during a difficult period for corporate climate planning. Companies are being asked to reduce emissions across operations, purchased energy, products, logistics, suppliers, and financed or enabled activity. Scope 3 emissions remain the hardest part of the agenda because supplier capability, customer behaviour, product design, infrastructure, and data quality all affect delivery.

That complexity has widened the gap between public climate commitments and operational progress. Targets set several years ago often assumed faster policy support, cleaner energy access, supplier readiness, technology deployment, or customer adoption than has materialised. SBTi’s new framework acknowledges some of those constraints while keeping pressure on companies to provide evidence of action.

The revised approach is likely to draw close scrutiny from sustainability teams, investors, campaign groups, and legal advisers. Greater flexibility could make the framework more usable for companies in hard to abate sectors or complex value chains. It could also prompt concern that weaker delivery may be presented as credible progress if transparency and validation are not sufficiently robust.

Corporate sustainability is entering a less forgiving phase. Companies are now being judged less by the ambition of their commitments and more by evidence of capital allocation, supplier engagement, product decisions, and measurable emissions reductions. Governance questions have already intensified around carbon accounting standards, including the pressure highlighted after a recent GHG Protocol governance dispute.

The new standard will influence internal governance as well as external disclosure. Climate targets cut across finance, procurement, operations, legal, product, investor relations, risk, and technology functions. A credible net-zero plan requires decisions about energy contracts, supplier standards, product substitution, logistics networks, capital expenditure, research and development, data systems, and executive accountability.

Boards will need to understand whether current targets remain suitable under the revised framework, whether the company should submit under Version 1.3.1 or prepare for Version 2.0, and how the transition period affects external commitments. Target pathways now influence annual reports, sustainability disclosures, lender conversations, customer tenders, and investor engagement.

The update also reinforces the need for stronger environmental data. Companies preparing for Version 2.0 will need reliable information on emissions sources, supplier performance, implementation barriers, and progress against milestones. That places pressure on data architecture, assurance processes, and supplier collaboration, particularly where information still sits in spreadsheets, procurement records, estimates, or unverified third party datasets.

Decarbonisation is increasingly tied to resilience, access to capital, customer eligibility, energy exposure, and supply continuity. Companies that can show credible progress may be better placed in tenders, financing discussions, recruitment, and investor relations. Those with weak evidence face greater scrutiny, even where headline targets appear ambitious.

The revised standard does not make net zero easier. It sets a clearer test of whether companies can connect commitments with operational delivery. The next phase will show whether additional flexibility supports faster progress or creates a more contested market for corporate climate credibility.