What are FLAG emissions?

Quick Answer: FLAG emissions are greenhouse gas emissions (and removals) that arise from Forests, Land and Agriculture activities, including deforestation, livestock management, fertiliser use, and land use change. They account for approximately 22% of global greenhouse gas emissions annually (EPA). The Science Based Targets initiative (SBTi) now requires companies in land-intensive sectors, or those where FLAG emissions exceed 20% of their total footprint, to measure and set separate FLAG targets alongside their non-FLAG science-based targets.

What are FLAG emissions?

FLAG stands for Forests, Land and Agriculture. FLAG emissions are the greenhouse gases released (or removed) as a result of how land is used and managed, covering everything from converting a forest to farmland to the methane produced by livestock digestion.

The term FLAG is now the standard label for this category in corporate carbon accounting, though scientific literature also calls it AFOLU (Agriculture, Forestry and Other Land Use). The two terms describe the same underlying set of activities.

FLAG emissions are distinct from the fossil fuel combustion emissions that most carbon accounting focuses on. They arise from biological processes: changes in land cover, shifts in soil carbon, and the natural byproducts of agricultural production. This makes them more complex to measure, but no less significant.

What activities produce FLAG emissions?

FLAG emissions fall into two primary categories, each with distinct sources.

Land use change (LUC) covers emissions that result from converting land from one type to another. The most significant example is deforestation: when a forest is cleared for agriculture or development, the carbon stored in trees and soil is released into the atmosphere. Companies typically track these emissions over a 20-year window from the point of conversion, meaning a forest cleared a decade ago may still be generating reportable LUC emissions today.

Land management covers ongoing emissions from how land is actively used. This includes:

• Methane from enteric fermentation (livestock digestion)
• Nitrous oxide from nitrogen-based fertilisers and manure management
• CO2 from changes in soil carbon caused by tillage or cropping practices
• Emissions from biomass burning

A third component, land removals, captures carbon drawn back into the land through reforestation, improved soil health, or other nature-based processes. Companies report removals separately from emissions. They represent a genuine mitigation opportunity, though companies cannot simply use them to offset FLAG emissions under current SBTi guidance.

Why do FLAG emissions matter for carbon accounting?

FLAG emissions represent roughly 22% of global greenhouse gas emissions each year, according to the EPA's Global Greenhouse Gas Overview, a figure drawn from the IPCC's Sixth Assessment Report. That exceeds the entire global transport sector (15%) and sits close to heavy industry (24%). Despite this scale, FLAG emissions have historically been left out of corporate GHG inventories, largely because no standardised calculation methodology existed.

That started to change in September 2022, when SBTi released its FLAG Science Based Target-Setting Guidance alongside a draft version of what would become the GHG Protocol's Land Sector and Removals Standard. That standard has since been finalised: GHG Protocol published the Land Sector and Removals Standard on 30 January 2026, effective from 1 January 2027, replacing the earlier draft guidance. Together, SBTi's FLAG Guidance and the GHG Protocol Land Sector and Removals Standard now provide the first consistent methodology for companies to measure, report, and set targets for their FLAG emissions.

For companies with significant land-related supply chains, ignoring FLAG emissions means reporting an incomplete footprint. A food manufacturer that accounts for its factory energy use but not the deforestation embedded in its agricultural inputs is missing a potentially large share of its actual climate impact.

Which companies need to report FLAG emissions?

Not every business will have material FLAG emissions, but the scope is broader than many assume.

SBTi requires companies to set separate FLAG targets if they meet either of the following criteria:

• They operate in an SBTi-designated FLAG sector
• FLAG emissions account for more than 20% of their total Scope 1, 2, and 3 footprint

The designated sectors are: Forest and Paper Products (forestry, timber, pulp and paper, rubber); Food Production, covering both agricultural production and animal source; Food and Beverage Processing; Food and Staples Retailing; and Tobacco. Companies in these sectors must engage with FLAG guidance regardless of their emissions profile.

Other sectors that frequently cross the 20% threshold include apparel and textiles (particularly those using natural fibres such as cotton, wool, or leather), restaurants, construction and building materials, containers and packaging, and retailers with significant food or agricultural product ranges.

The practical implication is that a company outside the designated FLAG sectors still needs to measure its FLAG emissions to determine whether the 20% threshold applies. For some businesses, particularly those with animal-derived or crop-based inputs in their supply chain, FLAG emissions represent more than half of their total footprint once properly calculated. If you're setting targets more broadly, our guide to the SBTi Corporate Net-Zero Standard V2.0 covers how FLAG fits alongside your energy and industry targets.

How does FLAG target-setting work under SBTi?

Companies required to set FLAG targets must do so alongside their non-FLAG science-based targets, submitted and validated separately. A company cannot meet its SBTi obligations by setting a single combined target. For background on how SBTi validation works more generally, see what is the Science Based Targets initiative.

SBTi offers two target-setting approaches. The FLAG Sector Pathway is an absolute reduction approach covering all corporate land-related emissions and removals, and is the default for demand-side companies (those using FLAG commodities as inputs without producing them themselves). The Commodity Pathway is an intensity-based approach available to supply-side companies where a single commodity represents 10% or more of their FLAG emissions, covering 11 pathways: beef, chicken, dairy, leather, maize, palm oil, pork, rice, soy, wheat, and a combined timber and wood fibre pathway.

Worth flagging: the timber and wood fibre pathway has been suspended since 2023 pending revision. SBTi ran a pilot of the updated pathway through 2026, with a synthesis report and revised tool expected in Q2 2026, so companies in the forest and paper products sector should check current availability before relying on it.

All companies subject to FLAG requirements must also make a no-deforestation commitment as a condition of setting a FLAG target, in line with the Accountability Framework initiative.

What changed in FLAG Guidance v1.2 (March 2026)?

SBTi published Version 1.2 of the FLAG Guidance on 19 March 2026, the first substantive update to FLAG's core criteria since it became mandatory in April 2023. Two things changed:

Deadline for existing SBT holders to add a FLAG target: previously, companies with a validated science-based target but no FLAG target had six months from the GHG Protocol Land Sector and Removals Standard's publication (January 2026) to add one. Under v1.2, that window has been removed. Companies must now set a FLAG target by their mandatory five-year SBT review at the latest, and are encouraged to move sooner where possible.

No-deforestation deadline: the original requirement was a commitment date no later than 31 December 2025. Under v1.2, companies setting a FLAG target for the first time now have up to two years after submitting for SBTi validation to achieve no-deforestation, with a hard cap of 31 December 2030 for submissions made after 2028. Companies with an existing validated 2025 commitment can extend it to no later than 31 December 2028, but only alongside public disclosure of progress against the original commitment, including any barriers encountered. SBTi's stated preference is for companies to keep their existing commitment where possible rather than default to the extension.

Where do FLAG emissions sit within a GHG inventory?

For most companies outside of primary agriculture, FLAG emissions appear predominantly in Scope 3 Category 1: purchased goods and services. A food retailer's FLAG emissions, for example, will largely sit in the upstream supply chain embedded in the agricultural commodities it buys.

For companies with their own farming or forestry operations, FLAG emissions can also appear in Scope 1, covering on-site land management activities such as livestock herds or managed forests.

Under the GHG Protocol's Land Sector and Removals Standard, companies must report land use change emissions, land management emissions, and land removals as separate line items within their inventory. Companies cannot aggregate them into a single figure. This level of disaggregation is more demanding than standard Scope 3 reporting, and requires either activity-level data (such as commodity volumes and sourcing locations) or statistically-derived estimates where primary data does not exist. For a wider look at how this kind of supplier-level data gets collected in practice, see Seedling's guide to Scope 3 supplier engagement.

For companies working through this process, having a carbon accounting platform that can handle the separation of FLAG and non-FLAG emissions within Scope 3 categories reduces the risk of double-counting or misclassification. Seedling supports full Scope 1, 2, and 3 measurement aligned with the GHG Protocol, including the data capture needed to identify where FLAG emissions are likely to be material in a company's footprint.

The land sector also holds significant mitigation potential: the IPCC's Sixth Assessment Report estimates the AFOLU sector could contribute 20 to 30% of the global mitigation needed to limit warming to 1.5°C or 2°C by 2050. That makes accurate FLAG measurement not just a compliance requirement, but a genuine input into any credible decarbonisation plan.