The Science Based Targets initiative (SBTi) has published an initial draft of its revised Corporate Net-Zero Standard for public consultation.

Currently 3,000 businesses worldwide have SBTi net-zero targets or have committed to set them. The draft standard aims to accelerate corporate decarbonisation by tackling the barriers to scope 3 action, maintaining focus on emissions reduction while exploring incentives to support scaling of climate finance and carbon removals, making it easier for companies in emerging economies to set targets and incentivising ambition and action through new model to validate and recognise progress against targets.

In greater details the draft proposals:

Splits out scope 1 and scope 2 emissions to reflect the unique challenges decarbonising each of these categories. Proposals include a commitment to move to low-carbon electricity no later than 2040.

Fields new options for tackling scope 3 emissions reductions with increased flexibility through options to set targets for green procurement and revenue generation, instead of setting an emissions reduction target. In focusing on direct suppliers and/or those in emissions-intensive sectors to align with net-zero, this proposal intends to focus action in the most emission-intensive activities and those where companies have the highest influence.

Creates opportunities to scale carbon removals and mobilise climate finance above and beyond the requirement for the direct decarbonisation to meet emissions reduction targets. This includes looking at formally recognising companies which are investing in Beyond Value Chain Mitigation (BVCM) and the introduction of interim carbon removal targets.

Tracks and communicates progress against targets introducing an assessment and communication of progress against targets requirement, to enhance accountability and recognise companies leading on decarbonisation.

Simplifies requirements for medium-sized companies in developing markets and SMEs through the introduction of streamlined requirements reflective of capabilities and resources, providing a springboard for universal voluntary corporate climate action.

To ensure a smooth transition from the SBTi’s existing Corporate Net-Zero Standard (V1.2) and Near-Term Criteria (V5.2), a comprehensive transition pathway will be developed. The public consultation will run from 18 March to 1 June, with stakeholders able to find more information in the SBTi’s Consultation Guide or through the associated webinar.

Francesco Starace, chair of SBTi said: “Working hand-in-hand with stakeholders across the ecosystem to seek and consider a diverse range of views, we aim to produce a standard that is both rigorous and practical, and works for businesses and the planet. With a limited carbon budget left, this is more important than ever. Companies can unlock long-term growth, drive transformation and build investor confidence by acting at pace to accelerate climate action.”

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