SBTi: the new Corporate Net-Zero Standard V2
SBTi has updated the Net-Zero standard. Companies with validated targets must revalidate by 2027. A summary of what changed, the practical impact and a revalidation roadmap.
Why V2 came along
Version 1.0 of the Corporate Net-Zero Standard, published in October 2021, was criticised for allowing unlimited use of carbon credits in some target categories and for not differentiating hard-to-abate sectors enough. V2 addresses that criticism with stricter rules, detailed sector pathways and wider Scope 3 coverage.
The revision also took in five years of validation experience: some V1 criteria proved impractical in real operations, while others left gaps that allowed weak targets to carry the SBTi mark.
What changed
Scope 3 targets become mandatory
It used to be mandatory when Scope 3 was ≥ 67% of total emissions. The threshold has now dropped to ≥ 40%. In practice, many more companies are required to set a Scope 3 target, with coverage across every material category.
A cap on neutralization
At most 10% of residual emissions may be neutralized through credits. And only with removals (ARR, biochar, DAC, BECCS), not avoidance. REDD+ no longer counts towards the net-zero residual.
Sector pathways
Specific paths for cement, steel, aluminium, chemicals and aviation. Companies in those sectors no longer use the generic 1.5°C pathway; they must align to their sector's path, calibrated to real technological constraints.
Mandatory reassessment every 5 years
Validated targets have to be revalidated every 5 years, even when performance is on track. This stops targets from going stale as the science moves.
BVCM encouraged
V2 formally introduces Beyond Value Chain Mitigation: climate investment beyond the company's own emissions, complementary to internal decarbonization. REDD+ fits here, with a narrative clearly separated from neutralization.
Who has to act
| Company | Action |
|---|---|
| Targets validated up to 2025 (V1) | Revalidate by December 2027 |
| Submitting a new target now | Submit straight under V2 |
| On the SBTi journey but not yet submitted | Model directly against V2 criteria |
| Hard-to-abate sector | Apply the specific sector pathway |
| Scope 3 between 40% and 67% | A Scope 3 target is now mandatory |
Operational revalidation roadmap
- Gap diagnosis (1 month): assess the current target against V2 criteria; identify gaps in Scope 3, neutralization and the sector pathway.
- Baseline refinement (2 months): make sure the base inventory is verified; review the organizational boundary.
- Pathway modelling (1-2 months): apply the sector methodology where it applies; calculate the reduction curve.
- Transition plan (1 month): document capex, governance and interim milestones.
- Drafting the commitment (2 weeks): in the format SBTi requires.
- Submission and validation (6-12 months): the SBTi queue.
- Public communication: align with the annual report, CDP, IFRS S2 and ESRS E1.
How Mangue helps
We support the whole SBTi journey: baseline definition, pathway modelling (including sector pathways), drafting the commitment, submission and revalidation. We have delivered more than 25 validated targets, approved first time with no qualifications.
For hard-to-abate companies we offer a technology feasibility analysis and a pathway adjusted to the sector's real constraints, not a generic formula.
- Assess your Scope 3 materiality now: above 40%, a target becomes mandatory under V2.
- Add removals (ARR, biochar) to the portfolio even if you use only avoidance today (REDD+); V2 requires removals for the net-zero residual.
- Hard-to-abate companies (cement, steel, chemicals) must align to their specific sector pathway, not the generic 1.5°C one.
- Mandatory reassessment every 5 years: plan a recurring process, not a one-off event.
- Prepare the revalidation narrative early; the SBTi validation queue runs 6 to 12 months in 2026.
Perguntas frequentes
Is my V1-validated target still valid?+
It remains operationally valid, but it has to be revalidated under V2 by December 2027. Companies that do not revalidate lose their 'Targets validated' status on the SBTi website.
What changed in the Scope 3 methodology?+
It used to be mandatory when Scope 3 was ≥ 67% of total emissions. The threshold has dropped to ≥ 40%. More companies are caught, the target scope is typically wider, and granularity per category is now required.
Can I use REDD+ for the net-zero residual?+
No. V2 requires removals (ARR, biochar, DAC, BECCS). REDD+ is avoidance; it can be used in BVCM (Beyond Value Chain Mitigation) but does not count towards the net-zero residual.
What is BVCM?+
Beyond Value Chain Mitigation. Climate investment beyond the company's own emissions, with no neutralization claim attached. Encouraged by SBTi V2 as a complement to internal decarbonization. It allows the use of avoidance credits (REDD+) with a robust narrative.
What does validating an SBTi target cost?+
The SBTi validation fee runs between USD 4,950 and USD 14,500 per validation (2026), depending on company size. The main cost is internal work plus consulting, usually USD 30k-150k for a mid-sized company in the first cycle.
- SBTi
- Science Based Targets initiative. A global initiative (CDP + UN Global Compact + WRI + WWF) that validates corporate emission reduction targets aligned with climate science.
- Corporate Net-Zero Standard
- The SBTi standard for corporate net-zero targets. V1 published in October 2021, V2 in 2024.
- 1.5°C pathway
- The emission reduction path needed to limit global warming to 1.5°C. It typically requires an absolute reduction of 4.2% per year for Scopes 1+2.
- Hard-to-abate
- Sectors where decarbonization is technically difficult: cement, steel, aluminium, chemicals, aviation and deep-sea shipping.
- BVCM
- Beyond Value Chain Mitigation. Climate investment beyond the company's own emissions, with no neutralization claim.
- Sector pathway
- A decarbonization path specific to one sector, calibrated to its technological and market constraints.
- Net-zero
- More than a 90% reduction in absolute emissions by the target date, plus neutralization of the residual with removals.
- Corporate Net-Zero Standard · Science Based Targets initiative
- Corporate Net-Zero Standard (documento) · Science Based Targets initiative
Frameworks mencionados neste artigo
IFRS S1 & S2 Roadmap
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