SBTi 2025

What does the SBTi’s Draft Corporate Net-Zero Standard Version 2.0 mean for companies?

In 2021, the Science Based Targets Initiative (SBTi) launched its first Corporate Net-Zero Standard, aimed at providing a clear and consistent definition of science-based net-zero targets for companies. Recently, SBTi has released a draft of its revised Corporate Net-Zero Standard for public consultation.

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Published on May 16, 2025

This revision comes at a crucial time, as the initial companies that set targets have now completed their validation cycles, requiring a reassessment and update of their goals. Moreover, the disparity between current global emissions and the necessary reductions remains alarming, making it more critical than ever to accelerate our efforts. The new standard aims to enable more companies to advance further and faster towards achieving net-zero emissions by addressing key issues in target setting and emission performance management.

What are the key changes in a nutshell?

The revised Corporate Net-Zero Standard introduces several key changes aimed at enhancing the rigor and practicality of emissions reduction efforts:

Governance and accountability
To enhance credibility and accountability, SBTi is introducing stricter governance measures such as a new governance model or tracking and communication requirements. These measures aim to prevent greenwashing and ensure that companies remain on track to meet their commitments.

Tracking and communication
The validation cycle now includes requirements for companies to assess and disclose their progress regularly. This enhancement aims to improve transparency and accountability, ensuring that stakeholders are well-informed about the companies’ advancements towards their net-zero goals in line with latest developments in the reporting space.

Target settings for scope 3 emissions
Scope 3 emissions, which include indirect emissions from a company’s value chain, have long been a significant challenge for corporations. The revised standard addresses this by using an impact-based prioritisation process rather than a minimum coverage as is currently the case: all significant categories (any categories representing more than 5% of total scope 3 emissions) or emissions intensive activities such as energy- and land-use-intensive industries will have to be considered. It places greater focus on nonemission metrics and targets without mandating specific coverage. This balanced approach aims to help companies concentrate on the most substantial sources of emissions within their value chains, striking a balance between feasibility and ambition.

Separate scope 1 and 2 targets
The standard now requires companies to set distinct targets for scope 1 and scope 2 emissions. Additionally, it includes guidance on scope 2 mitigation mechanisms and updates the absolute contraction approach to consider historical data. These changes enhance the robustness of the targets and provide a clearer path for companies to follow.

Climate removal and climate finance
The new standard continues acknowledging the importance of Beyond Value Chain Mitigation (BVCM) and climate finance, while maintaining a strong focus on the mitigation strategy by prioritising emission reduction. BVCM refers to mitigation actions or investments that fall outside a company’s value chain, including activities that avoid, reduce or greenhouse gas emissions from the atmosphere. The draft standard aims to incentivize companies to set science-based targets for reducing emissions within their operations and value chain, and to address the impact of emissions released during their net-zero transformation. Through consultation, the SBTi seeks to identify effective mechanisms to recognize and shape this leadership practice, to potentially drive increased investment in carbon removal technologies.

How can dss⁺ help

dss⁺ is uniquely positioned to support clients with comprehensive, end-to-end solutions for their decarbonisation challenges. We excel in identifying material risks and developing effective mitigation strategies.

We support our clients with:

Defining their decarbonisation pathways and roadmap, including the technical and financial planning
Enabling the implementation of scope 1 & 2 emissions reduction
Managing physical climate risk, including mitigation and emergency response plans
Enabling them to be “climate change-ready” by supporting the adaption of their organisational and governance model, empowering their leadership, ensuring the operating model is adapted and upskilling the workforce
Preventing climate transition risks by anticipating and adapting to evolving framework conditions such as compliance and reporting requirements
Identifying and developing value creation opportunities for the business along the decarbonisation journey

At dss⁺, we take pride in achieving sustainable results by addressing both practical and cultural challenges within organisations. Building on our legacy of sustainable transformation capabilities, our holistic approach ensures that we not only meet regulatory requirements but also foster a culture of sustainability that drives long-term success.