What to Expect from the Updated SBTi Corporate Net Zero Standard
The Science Based Targets initiative (SBTi) is in the final stages of revising one of the most important frameworks in corporate climate action: the Corporate Net-Zero Standard (CNZS).
The newly released Version 2.0 Second Consultation Draft outlines the most substantial shift since the standard first launched in 2021. And while the draft is still open for feedback, the direction is clear: more integrity, more consistency, more transparency, and more ongoing accountability.
If your company is setting, renewing, or planning to validate science-based targets, these changes will affect your timelines, your data strategy, and how you approach decarbonization across your operations and value chain.
At Green Project, we’re already preparing our clients for what’s coming. This guide breaks down the major updates, what they mean in practice, and how companies can set themselves up for a smooth transition.
When Do the New Rules Apply?
The biggest headline is timing. SBTi has confirmed that the updated CNZS v2.0 will not replace v1.3 until January 1, 2028.
That means:
- You can still validate new targets under v1.3 + Near-Term Criteria v5.3 until December 31, 2027.
- Existing near-term targets will stay valid through their current timeframe.
- Any company that needs to revalidate after 2028 (for example due to a target cycle ending, M&A activity, or significant structural changes) will need to meet the new v2.0 rules.
The extra year gives companies more breathing room, but it also signals how complex and far-reaching the changes are.
Category A vs. Category B Companies: Tailored Rules by Size and Geography
Another major shift is that SBTi now distinguishes companies based on size and location.
Category A
- Large companies or mid-sized companies in high-income countries.
- They face stricter requirements across the board, including mandatory transition plans, assurance, Scope 3 near-term targets, and shorter validation windows.
Category B
- Small and micro companies, and mid-sized companies in lower-income countries.
- They receive more flexibility and support, including longer deadlines and optional Scope 3 targets.
What This Means in Practice
Category A companies should expect:
- 12 months from Entry Check -> Initial Validation
- Mandatory transition plan within 12 months
- Mandatory third-party assurance
- Mandatory Scope 3 near-term target(s)
- Required contributions to “ongoing emissions responsibility” starting 2035
- Responsibility to help Category B suppliers build capacity
Category B companies get more optionality, but they’ll still need to build foundational systems, especially for supplier engagement and Scope 3 visibility, as expectations rise across the market.
This tiered approach acknowledges global equity while still pushing the entire ecosystem toward higher-integrity decarbonization.
From One-and-Done to Continuous Alignment
Under CNZS v1.3, companies validated their targets once and only returned to SBTi when they needed to set new ones.Version 2.0 introduces rolling compliance.
Every company will now follow a full cycle:
- Entry Check: Confirms readiness and intent to set targets.
- Initial Validation: The first full validation; now due within 12 months for Category A and 24 months for Category B.
- Renewal Validation: Required at the end of each target cycle (typically every 5–10 years). This includes reassessing your base year, recalculating targets if needed, and proving progress.
- Ongoing Performance Assessments: Companies must monitor and demonstrate progress during their target cycle, not just at the end.
- Spot Checks: SBTi may initiate these at any time based on complaints, concerns, or missing disclosures.
Why This Matters
Companies will need:
- Better internal data systems
- Predictable annual reporting workflows
- Up-to-date inventory and target documentation
- Supplier engagement programs that run continuously, not episodically
This entire model creates a higher bar for transparency and ongoing alignment, and drives demand for tools that keep companies audit-ready year-round.
Transition Plans Become Central, and Mandatory for Many
SBTi is aligning with global expectations that net zero commitments must be backed by real strategies, not just long-term numbers.
Category A companies must publish a transition plan within 12 months of validation.
Each plan must include:
- Concrete actions and timelines
- Milestones for retiring, upgrading, or phasing out carbon-intensive assets
- Strategy for fossil-fuel phaseout
- Assumptions and dependencies
- A financing approach
- Scope 3 strategies at the activity, supplier, or commodity level
- Governance and board-level approval
Why This Matters
Transition plans bring climate strategy into the core of business operations: capex cycles, procurement, product development, energy strategy, and supply-chain partnerships.
Category A suppliers must also support Category B suppliers, creating new expectations around training, engagement, and resourcing across value chains.
Assurance Requirements Expand Significantly
One of the most impactful changes is that Category A companies must obtain third-party assurance covering:
- Scope 1
- Scope 2
- Significant Scope 3 categories
To pass assurance, companies will need:
- High-quality activity data
- Clear boundary definitions
- Method documentation
- Pathway documentation (what pathway was selected and why)
- Supplier data that can withstand review
- Consistent treatment of base-year information across all targets
For companies already overwhelmed by Scope 3 data collection, this requirement may be the single biggest operational lift, and one that needs long-term planning now.
New Target-Setting Framework: More Structure, More Consistency
Some of the biggest operational updates include:
- Consistent target base year: Companies can no longer have different base years for different scopes. Your Scope 1, Scope 2, and Scope 3 targets must now share one base year.
- Separate targets for each scope: Combined Scope 1+2 targets are no longer allowed.
- Stronger sector standard requirements: The Power, FLAG, Buildings, and Automotive standards become mandatory where applicable.
- Clear target horizons:
- Near term: ≤ 5 years
- Mid term: ~10 years (still under discussion)
- Long term: by 2050
This framework makes targets clearer and reduces gaps or inconsistencies across business units.
Scope 1: More Methods, More Accountability
Companies now have three validated pathways for Scope 1 decarbonization:
- Emissions-based targets
- Alignment-based targets (share of low-carbon activities)
- Asset Decarbonization Plans (ADP): a major new approach
ADPs give each asset (plant, facility, fleet) its own carbon budget and retirement or retrofit schedule aligned with net-zero pathways. This method reflects the reality that heavy industry and transport cannot reduce emissions linearly.
For companies in heavy-emitting sectors, long-term Scope 1 targets are now mandatory. This will reshape asset planning, operational data systems, capital allocation, and procurement.
Scope 2: The Push Toward 24/7 Carbon-Free Electricity
SBTi is tightening Scope 2 requirements, moving beyond annual RECs and toward real-time alignment with clean electricity.
Key expectations include:
- 100% low-carbon electricity by 2040
- Electricity must meet a strict emissions intensity threshold (≤ 0.024 kg CO₂/kWh)
- Separate targets for heat/steam/cooling if they represent >5% of Scope 2
- Contractual instruments must meet new quality criteria:
- Geographic matching
- Temporal matching (hourly matching begins for major electricity users in 2030)
- Facility age criteria
- Demonstrated additionality
From 2030 onward, large electricity consumers (≥10 GWh in a single region) must begin phasing in hourly matching, eventually reaching 90% hourly alignment by 2040.
This represents a huge shift and a massive opportunity for companies to build more resilient, future-ready renewable energy strategies.
Scope 3: Higher Expectations, Smarter Flexibility
SBTi is refining the way companies set Scope 3 targets by focusing on materiality, influence, and integrity.
Key changes include:
- Targets required for any category ≥5% of total Scope 3
- Optional near-term targets for Category B
- Optional long-term targets for all companies
- Clear rules for justified exclusions
- Priority commodities (e.g., steel, aluminum, fertilizers, livestock products) must have their own targets
- Limited use of high-quality EACs is allowed when direct mitigation isn’t possible
EACs now have strict rules:
- Issued and canceled within the same 24-month period
- Geographically close to the activity
- Examples include SAF certificates, biomethane, low-carbon aluminum, green steel certificates, etc.
Critically, companies can now choose different target types based on their value chain, including intensity targets, supplier alignment, commodity alignment, ZEV transport targets, and more. This creates more flexibility while preserving integrity.
Ongoing & Residual Emissions: A New Layer of Responsibility
Perhaps the most transformational addition: SBTi is introducing a framework for how companies take responsibility for emissions they cannot eliminate during their transition.
There are two recognition levels:
- Recognized: ≥1% coverage of ongoing emissions; ~>$20/ton climate contribution
- Leadership: 100% coverage; ~>$80/ton with durable removal commitments
Category A companies must begin covering a portion of ongoing emissions by 2035, scaling up to 100% by 2050.
This does not replace abatement, and it cannot be double-counted toward Scope 1, 2, or 3 targets. It is a separate commitment to finance climate action aligned with integrity principles.
For companies thinking ahead, this is an early preview of what “high-quality net zero” will look like in the 2030s and beyond.
What This Means For You
CNZS v2.0 represents a major step toward more rigorous, meaningful climate action. And while the new requirements add complexity, they also add credibility to corporate net-zero commitments globally.
At Green Project, we’re preparing for this new era with tools designed to make the hard parts easier: automated data ingestion, aligned reporting frameworks, supplier engagement at scale, and assurance-ready documentation that grows with your climate ambition.