• SBTi’s revised Corporate Net-Zero Standard aims to bring more companies into science-based target setting, building on more than 3,000 companies with net-zero targets or commitments.
• The draft introduces new flexibility for scope 3 action, including green procurement and revenue-based targets for high-emitting value chains.
• The consultation runs from 18 March to 1 June, giving companies, investors, and climate stakeholders a chance to shape the final standard.

SBTi Opens New Consultation On Corporate Net-Zero Rules

The Science Based Targets initiative has opened public consultation on a draft update to its Corporate Net-Zero Standard, setting out proposed changes that could reshape how companies set, validate, and report climate targets.

The draft Corporate Net-Zero Standard V2 is designed to make science-based net-zero planning more practical for businesses while keeping direct emissions cuts at the center of corporate climate action. It also responds to one of the biggest challenges facing companies: how to address scope 3 emissions across complex value chains.

SBTi said the revised framework draws on the latest climate science, regulation, recognized standards, and business feedback. The aim is to support more companies worldwide in joining the more than 3,000 businesses that already have net-zero targets or have committed to setting them.

Through the consultation, SBTi is inviting companies and other stakeholders to test whether the proposals are both credible and workable. That balance will be closely watched by boards, investors, and sustainability teams that rely on SBTi validation to guide climate strategy.

Scope 3 Takes Center Stage

The draft standard directly addresses scope 3, the category many companies identify as the hardest part of net-zero target setting. Scope 3 covers value chain emissions, including suppliers, purchased goods, product use, transport, and other indirect emissions outside a company’s direct control.

More than half of businesses surveyed by SBTi cited scope 3 as their most significant challenge in setting net-zero targets.

In response, the draft proposes more flexible routes for action. Companies could set targets linked to green procurement or revenue generation, rather than only setting emissions reduction targets. The approach focuses on direct suppliers and emissions-intensive sectors, where companies often have the strongest influence.

For large corporates, this could sharpen expectations around supplier engagement and purchasing decisions. For investors, it may provide clearer insight into whether companies are using commercial influence to reduce emissions beyond their own operations.

Separate Targets For Scope 1 And Scope 2

The revised draft also separates scope 1 and scope 2 emissions to reflect the different challenges involved in cutting each category.

Scope 1 covers direct emissions from company-owned or controlled operations. Scope 2 covers indirect emissions from purchased electricity, steam, heating, and cooling. The proposed framework includes a commitment to move to low-carbon electricity no later than 2040.

That detail matters for companies operating across markets with very different energy systems. In regions where grid decarbonization is slower, corporate renewable power strategies, power purchase agreements, and electricity procurement will play a larger role in target delivery.

For executives, the message is clear: net-zero commitments will increasingly need to sit inside operational planning, procurement, finance, and energy strategy, rather than remain a standalone sustainability exercise.

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Carbon Removals And Climate Finance Enter The Frame

The draft maintains the central requirement for direct decarbonization. However, it also explores how companies can support climate finance and carbon removals beyond their own value chains.

SBTi said the draft includes options to address unabated and residual emissions. These include formal recognition for companies investing in Beyond Value Chain Mitigation and the possible introduction of interim carbon removal targets.

That proposal could influence how companies approach voluntary climate finance. It may also affect demand for high-integrity carbon removals, especially from corporates looking to show action beyond internal emissions cuts.

Still, the draft does not move away from emissions reduction as the core requirement. For investors and climate governance teams, that distinction will be important. Carbon removals may gain a more formal role, but they are not positioned as a replacement for cutting operational and value chain emissions.

Emerging Markets And SMEs Get Streamlined Requirements

SBTi is also proposing simplified requirements for medium-sized companies in developing markets and for SMEs.

The changes are intended to reflect different levels of capacity, data access, and resources. For emerging economies, this could help widen participation in voluntary corporate climate action without applying the same compliance burden faced by large multinationals.

That matters for global supply chains. Many smaller companies in developing markets face growing pressure from international customers to provide emissions data and align with net-zero targets. A streamlined pathway could help suppliers participate without being excluded by complexity or cost.

Progress Tracking Adds Accountability

The draft standard introduces a requirement for companies to assess and communicate progress against targets. The goal is to strengthen accountability and recognize companies making measurable progress on decarbonization.

This could raise expectations for annual reporting, internal governance, and board-level oversight. It may also help investors distinguish between companies with validated targets and those delivering against them.

SBTi said a transition pathway will be developed from the current Corporate Net-Zero Standard V1.2 and Near-Term Criteria V5.2. That pathway is intended to give companies confidence to continue setting targets under the existing framework while V2 is still being finalized.

The consultation runs from Tuesday, 18 March, to Sunday, 1 June. Feedback from public consultation, expert working groups, and pilot testing will inform the final standard.

For global companies, the draft is more than a technical update. It reflects the next phase of corporate climate governance, where emissions targets must connect more clearly to procurement, electricity strategy, supplier influence, climate finance, and credible progress reporting.