An increasing number of companies are committing to net-zero, with corporate pledges now covering 88% of global emissions. Still, progress is tainted by inconsistent approaches.
The Science-Based Targets initiative (SBTi) provides the framework for companies to set emission reduction targets aligned with climate science, supporting the goal of limiting global warming to 1.5 °C.
To strengthen its guidance, the SBTi is now revising its Corporate Net-Zero Standard. The new V2.0 draft, a major revision from the current standard, will transform how companies set and achieve Science-Based targets. The final version of the standard is expected to come into force in 2027.
1. Climate transition plans are mandatory.
Discover how to write an effective climate transition plan in this step-by-step guide.
Implementation disclosure is now compulsory, and companies must publish
climate transition plans within 12 months of committing to SBTi.
2. Companies are now classified into two categories.
Category A: Large and medium-sized companies operating in higher-income geographies, which are required to follow all criteria.
Category B: SMEs and companies in lower‐income regions, that have more flexibility on starting requirements. Both categories will still be required to reduce emissions to net-zero.
3. Third-party assurance is required.
Category A firms may be required to obtain third-party assurance for their emissions inventories, as well as, to substantiate progress between years.
4. Companies must set separate targets for Scope 1 and 2.
Businesses are now compelled to set distinct targets for direct (Scope 1), and indirect purchased energy (Scope 2) emissions. Scope 2 targets will be further split into location-based and market-based (or zero-carbon) targets.
5. Indirect mitigation is allowed under specific conditions
Under specific and time-limited scenarios market-based mechanisms, e.g. environmental attribute certificates, will be allowed to be used to drive emission reductions.
6. Target boundaries focus on high-impact value chain emissions
Instead of a fixed percentage, firms must now focus on all high-impact value chain emissions, defined as emissions categories representing over 5% of total emissions.
7. Carbon removals must be integrated earlier
The draft introduces three options for addressing residual emissions on a continuous basis. Residual emissions will continue to be defined for almost all companies as less than 10% of base year emissions.
8. Validation & progress reporting become stricter
A three-stage validation model (Entry, Initial, Renewal) will ensure continuous performance checks and target renewal, reinforcing accountability across the target cycle.
What these changes mean for your organisation
The revised standard signals a need to accelerate corporate decarbonisation while maintaining the rigour needed to meet the Paris Agreement’s goals.
If you want to start your SBTi journey but are unsure where to begin, our team is here to guide you every step of the way. We have a proven track record of supporting leading companies in setting and validating their science-based targets.
If you have more questions about climate transition plans and how to navigate the complexities of the SBTi framework, reach out to our climate lead: Ole Høy Jakobsen.
Learn from DEIF’s proven path to SBTi validation
We supported DEIF throughout the SBTi submission process, offering tailored guidance, addressing review questions, and ensuring a seamless experience. Our track record of 100% success rate in obtaining SBTi approval enabled DEIF to solidify its position as a leader in corporate climate action.
Read more
- SBTi (2025) SBTi Corporate Net-Zero Standard Version 2.0
- Our guide to the SBTi Guidelines
- A Climate Transition Plans explainer
Develop your climate transition plan
Under the updated SBTi standard, implementing a climate transition plan will become mandatory. Our decarbonisation series walks you through how to build one, step by step.
Author details
Eamon Murphy
Senior Consultant
