Introduction
The Science Based Targets initiative (SBTi) released the second version of its Corporate Net Zero Standard on 11 June.
The update moves away from a “one-size-fits-all” set of requirements applied to all organisations to a tiered approach based on a company's emissions profile, financial capacity, size and geography.
It also raises the bar on execution. Targets alone are no longer enough; organisations also need to show how they plan to meet them.
The rules don't come into full effect until February 2028, but the assessment work starts now. Organisations need to understand which category applies to them and map what a transition plan will require in practice.
Closing the gap between setting targets and actual carbon reduction
Under version 2.0, companies submitting carbon targets are now required to develop and monitor a transition plan. This closes the gap between target-setting and actual carbon reduction.
In practice, companies need to show how decarbonisation actions across the short, medium and long term will deliver against validated targets, and identify who is accountable for driving and overseeing progress.
The requirement is more demanding than previous versions, but it also gives companies a structured way to identify operational risks and inefficiencies.
Different organisations, different standards
Rather than applying the same requirements across organisations, the standard now distinguishes between organisations with greater emission exposure and financial capacity from those with a smaller footprint.
Different organisations, different standards
Rather than applying the same requirements across organisations, the standard now distinguishes between organisations with greater emission exposure and financial capacity from those with a smaller footprint.
Category A covers larger, more carbon-intensive organisations. They face stricter requirements: public disclosure of transition plans, independent assurance of greenhouse gas inventories, and more demanding performance indicators on emissions accounting coverage.
Category B is designed for organisations with a smaller footprint, including SMEs and companies operating in lower-income countries. The requirements are lighter, with more flexibility on how targets are structured and reported.
Knowing which category applies before committing to a submission timeline is important, as it determines disclosure and assurance obligations.
Keeping targets current
Previous targets were anchored against a fixed baseline year, typically the oldest year with reasonably complete data. In practice, that often meant measuring progress against figures that no longer reflected how a company actually operated.
Carbon baselines will now be readjusted every five years. The intent is to make decarbonisation an ongoing management process and ensure that targets reflect how a business actually operates today.
What organisations need to do next
SBTi opens validation under version 2.0 Q1 2027. Both this and the previous version are accepted until 31 January 2028. From 1 February 2028, V2.0 is mandatory:
If you already have validated targets, they stay valid to the end of the five-year review window. Move to V2.0 when you renew, or from Q1 2027.
If you are mid-way through setting targets, continue under V1.3.1. SBTi says submit now, don’t wait. You keep current flexibilities (such as combined Scope 1 and 2) and the targets stay valid.
If you haven’t set targets and plan on submitting them in 2026, use V1.3.1. If you are submitting in 2027 or later, plan for V2.0. The core requirements remain inventory and base year, two or more near-term targets, and a decision on a net-zero goal.
What this means in practice
Version 2.0 shifts the focus from setting targets to delivering on them. It requires companies to embed a decarbonisation strategy into their operations, governance and investment decisions.
SBTi's own research found that 91% of surveyed companies said science-based targets had a positive impact on their organisation, with 80% reporting stronger investor relations and 72% citing improved resilience to future regulatory change.
For companies that haven't yet built those practices, the 2028 deadline is a practical forcing function.
