Developing the Corporate Net-Zero Standard

Project Background

The Corporate Net-Zero Standard was initially launched by the SBTi in October 2021 to address the growing need for a common understanding of science-aligned net-zero targets in the corporate sector. Since then, there have been two minor revisions of the standard, V1.1 and V1.2. The SBTi is now undertaking a major revision, which will result in V2.0 of the Corporate Net-Zero Standard.

The SBTi Corporate Net-Zero Standard V1.2 is the most recent and valid resource for companies to set net-zero aligned science-based targets.

About the Corporate Net-Zero Standard V2.0 Project

The development of the Corporate Net-Zero Standard Version 2.0 revision is being conducted according to the Standard Operating Procedure (SOP) for the Development of SBTi Standards. The update is happening in line with the regular review cycle, as outlined in the SOP, which must happen every two to five years.

The next major output of the Corporate Net-Zero Standard revision will be the draft Standard for consultation, which is expected by the end of 2024. This will be followed by a public consultation. The SBTi invites all stakeholders to participate and contribute their views.

The revised Corporate Net-Zero Standard will come into effect in 2026. No changes to the Standard, nor final decisions regarding its content, will be made before this point. Businesses wishing to set net-zero targets should continue to do so, using the current Corporate Net-Zero Standard V1.2.

The SBTi has four key goals for the revision of the Corporate Net-Zero Standard:

1. To align with the latest scientific thinking and best practice, such as from the IPCC and the UN Secretary General’s High Level Expert Group on the net zero emissions commitments of non-state entities (HLEG).

2. To address challenges related to scope 3 target setting and implementation.

3. To integrate continuous improvement and target delivery.

4. To improve structure and enhance interoperability with other SBTi standards as well as other relevant external frameworks and standards.

Deliverables of the Corporate Net-Zero Standard V2.0 Project

The deliverables of the SBTi Corporate Net-Zero Standard V2.0 (excluding research) are:

Final deliverables:

• Corporate Net-Zero Standard V2.0

• Updated Corporate Target-Setting Tool(s)

• Criteria assessment indicators

Interim deliverables:

• Public Consultation Draft Standard

• Public Consultation Feedback Report

• Pilot Testing Feedback Report

• Basis for Conclusions Report

The SBTi Corporate Net-Zero Standard V2.0 Project involves a significant number of inter-related research projects, including revision of target-setting emission pathways and methods, review of the scope 3 target-setting framework, research to assess target achievement (initially focused on scope 1 and 2), and a call for evidence on the effectiveness of Environmental Attribute Certificates (EACs) in corporate climate targets.

Technical outputs published on July 30th 2024:

• Scope 3 discussion paper: A discussion paper setting out the SBTi’s initial thinking on potential changes being explored around scope 3 target setting, including underlying principles and concepts. The paper is informative by nature and does not propose draft requirements or criteria.

• Evidence received on the effectiveness of Environmental Attribute Certificates: The release of all evidence received as part of the open call on the effectiveness of Environmental Attribute Certificates (without SBTi assessment).

• Synthesis report of evidence on the effectiveness of Environmental Attribute Certificates in corporate climate targets – Part 1: Carbon credits: A report presenting SBTi’s synthesis of the evidence submitted through the call for evidence on the effectiveness of carbon credits in corporate climate targets.

  • This is the first of the three distinct reports that will be published as outlined in the Terms of Reference; the reports on the other EAC instruments will be published at a later stage.

• Findings of independent systematic review on the effectiveness of carbon credits in corporate climate targets: A statement summarizing the assessment conducted by an independent third party on peer-reviewed academic literature on the effectiveness of carbon credits when used as a substitute for direct abatement. The statement summarizes the process followed, findings and limitations of this research exercise. The Annex describes in detail the methodology followed.

Stakeholder Engagement

The revision of the Corporate Net-Zero Standard V2.0 is being conducted by the SBTi. Stakeholder involvement is possible via the following channels:

• Project feedback form. Any stakeholder is welcome to submit feedback on documents that have been released over the course of the project.

• The SBTi will initiate structured outreach to get further technical input from the Technical Advisory Group (TAG) and Scientific Advisory Group (SAG), to support development of the first draft of the Corporate Net-Zero Standard V2.0.

• Public consultation. The revision to the Corporate Net-Zero Standard will go through one round of public consultation for a minimum of 60 days. Stakeholders will have the opportunity to submit feedback to the consultation questionnaire via a survey.

• Pilot testing. The revision to the Corporate Net-Zero Standard will undergo pilot testing.

These opportunities for stakeholder engagement will be communicated on the SBTi website, newsletter and social media platforms.

Resources

Relevant resources can be found below:

• Corporate Net-Zero Standard V2.0 Project Terms of Reference

• Standard Operating Procedure (SOP) for the Development of SBTi Standards

• Landscape Analysis: Measurement, Reporting and Verification (MRV) of Science-Based Targets Research Report

• Above and Beyond: An SBTi Report on the Design and Implementation of BVCM

• Scope 3 Discussion Paper

• Evidence received on the effectiveness of Environmental Attribute Certificates

• Synthesis report of evidence on the effectiveness of Environmental Attribute Certificates in corporate climate targets – Part 1: Carbon credits

• Findings of independent systematic review on the effectiveness of carbon credits in corporate climate targets and annex

• SBTi Glossary

Contact

For enquiries about the SBTi Corporate Net-Zero Standard, email the team at standards@sciencebasedtargets.org.

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