SBTi Expands Corporate Net-Zero Standard Revision to Address Carbon Neutralisation

The Science Based Targets initiative published an updated Terms of Reference for the revision of its Corporate Net-Zero Standard in September 2024, including plans to refine its approach to neutralisation of residual emissions. SBTi hosted workshops at Climate Week NYC and in London in September and October 2024 to inform the research.

SBTi's Corporate Net-Zero Standard, first published in 2021, requires companies that have achieved their long-term emissions reduction target to neutralise any residual emissions through permanent removal and storage of atmospheric CO2. The updated Terms of Reference for the ongoing revision include a specific focus on clarifying near-term actions companies can take toward the long-term goal of counterbalancing scientifically defined residual emissions. The standard remains unchanged pending completion of the revision process.

Neutralisation—determining how and when companies can use carbon dioxide removal and storage to address residual emissions at net-zero—is one of the most complex and contested areas in corporate climate target-setting. Clarifying the approach will have significant implications for how companies plan their decarbonisation trajectories and invest in carbon removal technologies. As global carbon markets and CDR methodologies evolve rapidly, authoritative guidance from SBTi on this topic is expected to influence both corporate strategy and investor expectations.

Insights gathered at the September and October 2024 workshops were to be incorporated into an SBTi research paper supporting the standard revision. A draft Corporate Net-Zero Standard was expected to be released for public consultation and feedback in the months following the announcement. The standard development follows SBTi's standard operating procedure and includes public consultation and expert review stages. The eventual clarification of neutralisation requirements will help companies design more robust long-term net-zero strategies.

Key figure — 2021 original publication year of the Corporate Net-Zero Standard V1