The SBTi Corporate Net-Zero Standard V2.0, explained

The SBTi, and why a full revision

If a business sets or reports corporate climate targets, the Science Based Targets initiative is difficult to avoid. It is the body that decides what counts as a credible, science-aligned target, and its validation has become the global benchmark for serious net-zero commitments.

Set up in 2015, the SBTi exists to make science-based target setting standard business practice. It defines what a credible target looks like in line with current climate science, gives companies the technical guidance to get there, and independently validates the targets they set. Its flagship Corporate Net-Zero Standard launched in 2021 and quickly became the reference point for what net zero means in practice.

More than 11,000 companies worldwide now hold SBTi-validated targets. It remains a voluntary framework, but for a growing number of investors, clients and regulators, SBTi alignment has moved from a differentiator to a baseline expectation.

On 11 June 2026, the SBTi published Version 2.0 of the Corporate Net-Zero Standard. It is the largest revision since the first standard arrived in 2021, and it takes effect on 1 February 2027.

The reason for a full revision is set out plainly in the standard itself. A decade of working alongside companies taught the SBTi that commitment is not the hard part – delivery is. Company after company set targets in good faith and then ran into the same obstacles: supply chains they had limited information about and could not fully control, technologies not yet available at scale, investment cycles that did not line up with target periods, and Scope 3 emissions that depended on thousands of suppliers and customers at very different stages. V2.0 responds to that experience.

The headline shift is from setting targets to delivering them, with the evidence to prove it.

Version 2.0 explained

In summary

V2.0 is the SBTi's most comprehensive framework to date. Under it, every company sets targets over a five-year cycle. Validation is no longer a one-off credential – it’s the start of a repeating cycle of action, annual reporting and renewal.

Here’s what you need to know about V2.0 and how to comply.

First: Category A and Category B - and who falls into each

V2.0 sorts companies into two categories, with different obligations attached to each. Category A covers large companies in any country, plus medium-sized companies in high-income countries such as the UK. Category B covers small companies everywhere, plus medium-sized companies in lower-income countries. Category A carries the fuller set of obligations. Category B keeps the same core requirements with proportionate flexibility.

The thresholds, taken directly from the standard, work as follows:

A few practical points sit behind the table. Thresholds are assessed on consolidated group figures, converted to euros, and averaged across the two most recent financial years. A company's category is fixed for the full five-year cycle and redetermined when it sets new targets.

Before, the SBTi has a separate track for SMEs with a completely different standard; the new approach consolidates and simplifies this. However it still really matters which category you fall into. Where the two categories diverge most:

One point that is worth catching early: even a Category B company's largest clients are likely to be Category A, whose Scope 3 targets now run on a significance basis. That makes good supplier emissions data part of their compliance, whether or not the smaller company sets its own SBTi targets. This means that strong carbon data is becoming a commercial expectation, not only a reporting one.

What follows works through the standard in the order a business would tackle it.

The process: how to comply with V2.0

Measure: target base year assessment (Chapter 2)

Everything starts with a defensible footprint. Under V2.0, the target base year is the most recent year for which a company holds a comprehensive emissions inventory, ideally aligned to its financial reporting period. This replaces the fixed historical base year used in Version 1, so a target reflects where the business actually sits rather than a snapshot from years earlier. A company can still communicate its targets relative to an earlier reference year if it wants continuity.

The inventory must be built to the GHG Protocol across Scopes 1, 2 and 3, and a set of supporting metrics is reported alongside it, including total electricity consumption, the share of low-carbon electricity, and any emissions-intensive activities. An emissions-intensive activity is any Scope 3 category that represents 5% or more of total Scope 3 emissions, along with high-emitting commodities such as steel, cement and FLAG (forest, land and agriculture).

This is the first point where the categories diverge. Category A companies must obtain independent third-party assurance over their base year data, to a minimum of limited assurance. For Category B companies this is recommended rather than required.

Set targets: target setting (Chapter 3)

Every company sets separate near-term targets for Scope 1 and Scope 2, each over five years and each covering 100% of the relevant emissions. The combined Scope 1 and 2 target from Version 1 is gone. Near-term Scope 3 targets are required for Category A and optional for Category B.

Scope 1 offers three routes: an absolute emissions reduction on a straight-line trajectory to the net-zero year, a sector emissions-intensity reduction (for activities such as steel, cement or chemicals), or an asset transition target for companies whose capital stock does not turn over on a linear path. Where the intensity or asset transition route is used, a long-term target is also required.

Scope 2 moves toward low-carbon electricity over time. Companies can set a low-carbon electricity alignment target, an absolute location-based reduction target, or both. Low-carbon electricity includes renewables and nuclear, as well as generation fitted with carbon capture and storage. Procurement is expected to sit in the same system as consumption, with flexibility for power purchase agreements and load aggregation, and existing contracts grandfathered. Hourly matching of supply to demand is encouraged, and the largest electricity users are required to report the share of consumption matched on an hourly basis.

Scope 3 moves from a single coverage percentage to a significance-based approach. Companies can make limited, justified exclusions to focus on material emissions and the areas where they have influence, for example any category below 5% of total Scope 3, or activities over which they have no practical control. They then choose from three options: an overarching emissions reduction target (a linear contraction to roughly 10% residual emissions or less by 2050), a supplier or customer alignment target (growing the share of tier 1 suppliers or customers setting and progressing against science-based targets), or category- and activity-specific targets for concentrated or high-emitting sources. Long-term Scope 3 targets are optional across the board.

Plan and act: governance, transition plan and implementation (Chapters 1 and 4)

Targets now have to be owned and delivered, not just set.

On governance, the highest level of governance within a company, the board or its equivalent, must formally approve the targets and assume accountability for developing, submitting and implementing them, and must join up carbon strategy with commercial strategy.

On planning, all companies develop and maintain a board-approved transition plan. It sets out the actions and timeframes needed to deliver the targets, the emissions sources covered, the key assumptions and dependencies, and a high-level path to net-zero by 2050 at the latest. Where relevant, it also covers phasing out revenue from unabated fossil fuels and a plan to decarbonise emissions-intensive activities. Category A companies must disclose the plan publicly, when targets are validated or up to 15 months later. Category B companies are strongly encouraged to do the same.

On action, V2.0 introduces an implementation hierarchy that defines what credible delivery looks like. Direct actions come first: cutting emissions at source within operations and value chains, through efficiency, fuel switching and supplier engagement. Where emissions sit in shared systems such as grids, supply sheds or logistics networks, companies can act within those systems, supported by market instruments under defined guardrails. Sector-level actions are a last resort where the options above are constrained. Actions and instruments have to meet minimum integrity criteria, including additionality. The type of claim a company can make depends on the outcome: a company-level claim where the action changes its own physical inventory, and a system contribution claim where the action works at the activity-pool or sector level.

Track progress (Chapter 5)

Under Version 1, validation was effectively a credential. A company set a target, had it validated, and that was the headline event. Under V2, the separate five-year review has been retired, because every target is now set on a five-year basis to begin with. The cycle is built into the target itself.

Under Version 1, validation was effectively a credential. A company set a target, had it validated, and that was the headline event. Under V2, the separate five-year review has been retired, because every target is now set on a five-year basis to begin with. The cycle is built into the target itself.

Years 1 to 4. The company publishes an annual progress report covering its emissions inventory, progress against each target, and any changes to the transition plan, including the barriers it has hit and what it is doing about them.

Year 5. The company completes an end-of-cycle assessment, a structured evaluation of how the cycle went, supported by a full-scope inventory and, for Category A, third-party assurance to substantiate it.

Next cycle. The base year moves forward to the latest data, and fresh near-term targets are set. Those targets reflect actual past performance: fall short in one cycle, and the next is set to make up the ground.

This is what people mean when they say V2.0 ends the "set and forget" era. It rewards businesses with credible data and a real plan, and exposes those that treated a validated target as the finish line. It also sits alongside the assurance direction in CSRD and other frameworks, so the work increasingly counts more than once.

Take responsibility for ongoing emissions (Chapter 6)

The final chapter deals with the emissions that persist while a company works toward its targets. The new Ongoing Emissions Responsibility programme is a voluntary recognition mechanism for taking action on those emissions, through reductions, removals or other climate actions such as research funding or adaptation and resilience finance. Ambition can run from 1% to 100% of ongoing emissions, across three recognition levels.

The framing is deliberate. These contributions complement reducing a company's own footprint, they do not substitute for it. Any high-integrity credits used here must be permanently retired, cannot be double counted, and cannot count toward Scope 1, 2 or 3 targets or be netted from the inventory.

From 2035, the SBTi intends to make ongoing emissions responsibility mandatory, including neutralising residual emissions at net-zero using eligible carbon removals, matched by durability so that long-lived emissions are balanced by long-lived removals. This future requirement is signalled primarily for Category A companies and will be reviewed in the next major revision of the standard.

How V2.0 differs from Version 1

The thread running through every change is accountability. Version 1 asked a company to set a credible target. Version 2 asks it to set a credible target, show how it will deliver it, prove its progress each year, and back the numbers with independent assurance if it is a larger business.

The shifts that make the biggest practical difference:

• The base year moves to the most recent complete year, rather than a fixed historical year.
• Targets run on a five-year cycle with annual reporting and an end-of-cycle assessment, replacing the one-off validation and five-year review.
• Scope 3 becomes significance-based: every category at 5% or more of total Scope 3 needs a target, in place of the previous 67% threshold.
• A transition plan and board accountability become part of validation, where governance was largely implicit before. Category A companies publish their plan.
• Limited assurance of base year and target data is required for Category A, where no assurance was required before.
• Ongoing Emissions Responsibility replaces Beyond Value Chain Mitigation, with removals responsibility signalled for Category A from 2035.

 The detail, side by side:

Timeline: when companies can align, and when they must

V2.0 is being phased in with a genuine transition window rather than a hard switch-over. The short version: companies can start aligning now, and must be aligned for any new submission from 1 February 2028.

When companies can align. Now. Companies do not need to wait for the mandatory date to start working to V2.0, and there are good reasons not to. Some of the framework is already usable under Version 1, such as setting targets from a recent base year rather than a fixed historical one. From 1 February 2027, a company can submit a full set of targets against V2.0 if it chooses to. For most businesses the sensible move is to keep setting targets on the current timetable while building the data, governance and transition plan to V2.0 specification from the outset, so the next cycle has nothing to retrofit.

When companies must align. From 1 February 2028, V2.0 is mandatory for every new target submission. Existing validated targets are not affected straight away: they remain valid until their target year or their five-year review point, whichever comes first, at which stage new targets are set under V2.0. In practice that means a company with 2030 targets keeps delivering them, then sets its next cycle, 2030 to 2035, under V2.0 from 2028. Looking further ahead, the post-2035 ongoing emissions responsibility requirement is the one fixed date in the standard that applies regardless of when a company first sets targets.

The takeaway is that the work done now is not wasted. Whether a business enters under Version 1 or prepares to lead under Version 2.0, the base year, data, governance and planning it puts in place are what the next cycle is measured against.

How Seedling can help

V2.0 raises the bar in three places at once: the quality of the data, the structure of the targets, and the discipline of reporting on them every year. That is what our platform and our team are built for.

Full-scope, audit-ready data. Everything starts with a defensible footprint. We build a full Scope 1, 2 and 3 inventory to the GHG Protocol, with accounting integrations and supplier engagement tools that bring primary data into the numbers rather than re-keying it. With limited assurance arriving for Category A companies, we structure the inventory the way an assurer expects to see it, with clear boundary documentation, traceable activity data and a clean audit trail.

SBTi-aligned target setting. We set near-term Scope 1 and Scope 2 targets separately, apply the significance test to identify the Scope 3 categories that need a target, and select the right method for each, from absolute reduction to the new supplier, customer and activity-specific approaches.

Reduction planning and ongoing progress. A target without a plan does not pass V2.0, so we help build the transition plan and the reduction actions behind the numbers, then track delivery against them. When the annual report and end-of-cycle assessment come around, the evidence is already in place.

Expert guidance alongside the software. The judgement calls around category thresholds, Scope 3 exclusions, assurance readiness and transition planning benefit from someone who knows the standard inside out. Our Carbon Impact Lead, Henry Jones, is one of only a small number of SBTi Certified Experts in the UK, so the guidance is grounded in the standard. Seedling is a B Corp carbon management platform trusted by more than 500 businesses, with over 500,000 tonnes of CO2e measured and a 95% client retention rate year on year.

Whether a business is setting targets for the first time, renewing an existing set, or weighing up whether to enter under Version 1 or prepare for V2.0, we can map the route through it.

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