SBTi Releases Corporate Net-Zero Standard Version 2.0 With Best-Efforts Framework

The Science Based Targets initiative published Corporate Net-Zero Standard Version 2.0, introducing a best-efforts compliance framework allowing companies to remain certified even if targets are not fully achieved, provided they demonstrate transparent reporting on barriers and mitigation actions. The update also introduces differentiated requirements by company size and national context, and three new approaches for Scope 1 target setting.

SBTi V2 introduces a two-category company system: Category A covers large companies from all countries and medium-sized companies from high-income countries, while Category B covers small companies from all countries and medium-sized companies from lower-income countries. All companies must set near-term 5-year Scope 1 and 2 targets, while only Category A companies must also set near-term Scope 3 targets and disclose transition plans with limited assurance of base year data. Scope 1 target-setting options include absolute emissions reduction, emissions intensity reduction and an asset transition approach.

The new standard introduces three Scope 3 target-setting approaches: an overarching emissions reduction target; a supplier and customer alignment target based on the share of Tier 1 suppliers and customers setting science-based targets; and a category- or activity-specific target for companies with concentrated high-emitting value chain activities. Companies can make justified exclusions on a limited basis where a Scope 3 category accounts for less than 5% of emissions or where practical influence is lacking.

A new Ongoing Emissions Responsibility framework provides companies with a voluntary mechanism to support carbon removals to neutralize residual emissions, with this becoming mandatory for Category A companies from 2035. The standard also introduces an implementation hierarchy prioritising direct emissions reduction over shared-system mechanisms and sector-level actions. SBTi CEO David Kennedy said the standard provides a framework for companies to manage transition risk and gain competitive advantage while contributing to international climate objectives.

Key figure — Category A companies required to set Scope 3 targets and disclose transition plans