Dive Brief:

• The Science Based Targets initiative finalized updates to its Corporate Net-Zero Standard Thursday, which establishes differentiated target-setting for companies based on size and sector, as well as additional target setting options across scope 1, 2 and 3 emissions.
• The newest version of the standard includes a program for continued assurance and introduces mandatory governance, board accountability, transition planning and disclosure. The update also sets a new tiered emissions responsibility for companies — which includes voluntary recognition of corporate climate commitments — and a requirement for larger organizations to purchase carbon removals from 2035 onward.
• Version 2 of SBTi’s net-zero standard has been in the works since April 2024, and the organization issued public consultation drafts in March and November 2025. The standard will be ready for companies to use for target-setting beginning in February 2027, SBTi said Thursday.

Dive Insight:

SBTi said the second version represents a “major revision” of the Corporate Net-Zero Standard; 42% of the included sections are entirely new, and the other 58% represent modifications to the existing approach, according to a document summarizing changes.

The release comes shortly after SBTi said it will make a strategic pivot and look to become a “transformation partner” over the rest of the decade by creating tailored approaches to decarbonization, increasing its implementation focus, expanding across additional high-emitting sectors and regions and creating interoperability and reducing fragmentation.

Companies have told SBTi that they need help with implementation, “and that’s what the Corporate Net-Zero Standard Version 2.0 is designed to do,” SBTi CEO David Kennedy said in a June 11 press release.

“Businesses now have a great opportunity to manage their transition risk and strengthen resilience in a fast-changing world,” Kennedy said. “The Standard provides a framework to achieve this in practice across a wide range of contexts, through aligning climate science with actions that they can and should take to transform their businesses.”

As SBTi looks to increase its role as a “partner” in the corporate net-zero transition, the standard also introduces an implementation hierarchy for how companies should undertake decarbonization actions. The standard requires companies to prioritize activity-level actions to reduce emissions before pursuing a more indirect action and also covers market instruments and electricity purchasing.

As part of the changes outlined, SBTi will now require companies to receive internal approval to pursue science-based targets, instead of requiring them to make a public proclamation. The organization said in a conclusions document that the change was made to “mitigate potential barriers to adoption, as well as reputational or legal risks associated with public net-zero commitments before they are substantiated with targets and plans.”

Version 2 of the standard also separates scope 1 and scope 2 emissions accounting and target-setting. Companies will now have three emissions-based target setting options for scope 1 emissions, or emissions from organization-owned sources. Companies will also have the option of creating absolute emissions reduction targets, emissions intensity reduction targets or targets based on asset transition.

The new standard will give companies two options for setting scope 2 emissions targets, or targets based on emissions from the decarbonization of purchased electricity, heat, steam and cooling: one based on emissions reduction targets or an option requiring companies to increase their share of low-carbon electricity use, contracting or matching over time.

Large and medium-sized companies in high-income countries — considered Category A companies — will be required to “support eligible carbon removals” that are equivalent to at least 1% of their ongoing emissions across scopes 1, 2 and 3, beginning in 2035. SBTi said in the conclusions document that the requirement, “combined with broader emissions scope coverage and a minimum long-lived removals component — signals clear future expectations for companies and balances stakeholder concerns.”

SBTi Chair Francesco Starace said in the foreword that the updated standard “is designed to be a navigation tool for companies to manage their transition risk and unlock economic benefits in the world as it actually is.”

“The most important shift in Version 2.0 is this: It is an action framework designed to help decision-making,” Starace said. “For boards and CFOs, that means targets connected directly to strategic planning and investment cycles. For operations and procurement teams, that means clearer and more actionable guidance on what counts and how to prioritize. For sustainability leads, a standard that can be embedded into core business processes and defended at board level as a tool for managing transition risk and creating value.”

Over 11,000 companies have already set or validated targets under prior SBTi standards, and SBTi said those targets will remain valid through their target cycle. The target-setting organization said it expects to release a renewal policy in Q4 of this year that will incorporate elements from version 2 into guidance for companies already in the system. 

Companies with target commitments or renewals due in 2026 or 2027 are recommended to continue using version 1.3 of the net-zero standard and move to version 2 in their next target cycle.