What is SBTi?
The Science Based Targets initiative is a partnership between CDP, the UN Global Compact, the We Mean Business Coalition, World Resources Institute, and WWF. It validates corporate greenhouse gas reduction targets against 1.5°C and net-zero science. By June 2026, when the Corporate Net-Zero Standard V2 (CNZS V2) was published, over 11,000 companies and financial institutions held validated SBTi targets, representing approximately 41 percent of global market capitalisation across 86 territories and 52 sectors.
While SBTi has made significant progress, it hasn’t always been linear; around 200 companies were reported delaying, revising, or withdrawing participation in 2025. This was a small fraction of the net 40% growth in validated targets over the same period, but a signal of the practical tensions the standard is navigating. Near-term target requirements were eased in April 2026 to address the growing gap between what the standard required and what companies could credibly commit to, and a 2024 analysis found a majority of SBTi-aligned companies were still missing their Scope 3 trajectory. SBTi’s influence nonetheless remains significant with validated targets now referenced in ESG ratings, lender covenants, and procurement frameworks, making SBTi the leading standard-setter in corporate climate target-setting. How it treats land, forests, and carbon credits shapes a significant share of global demand for nature-based solutions.
SBTi operates two distinct but interconnected frameworks relevant to forests, including the FLAG (Forest, Land and Agriculture) guidance, which sets emissions reduction and removal targets for companies with significant land-sector emissions and the Corporate Net-Zero Standard (CNZS), which governs all companies’ overall net-zero pathways, including the role of carbon credits.
FLAG makes forests and land part of the corporate target itself: land-intensive companies must set separate science-based targets for their land-sector emissions and removals, following the mitigation hierarchy. The contested no-deforestation deadline has moved from December 2025 to December 2030, and version 1.2 (March 2026) aligns FLAG with the GHG Protocol’s new land-sector accounting standard. The result is mandatory demand for land-based removals, but a narrow removals focus that undermines demand for REDD.
Open as full pageCNZS V2 (June 2026, effective February 2027) replaces Beyond Value Chain Mitigation with Ongoing Emissions Responsibility (OER): a tiered, accountable channel for corporate climate finance beyond the value chain. Credits still cannot count toward reduction targets, and REDD is eligible throughout, but from 2035 large companies face a mandatory removals obligation and at the net-zero year only removals qualify. Every company must publicly declare whether it participates, and a “no” requires a published explanation.
Open as full pageConservation groups welcomed OER’s recognition of nature-based solutions, but the framework never requires anyone to finance the protection of standing forests. Removals are mandated from 2035, avoided deforestation and degradation are merely permitted. Natural climate solutions, dominated by forests and avoided deforestation, could provide 37% of the cost-effective mitigation needed by 2030 with the right incentives. The Q4 2026 consultation on the SBTi Claims System is where a specific role for high-integrity REDD can still be shaped.
Open as full pageAccounting in the GHG Protocol land sector standard
The GHG Protocol Land Sector and Removals Standard (LSRS), published 30 January 2026 with implementation guidance (v1.1) following in June 2026, is effective 1 January 2027. It provides the first standardised global framework for companies to account for agricultural land-sector emissions and CO₂ removals, covering land-use change, land management emissions, biogenic CO₂, and non-CO₂ gases from agriculture. It also establishes accounting requirements for technological removals including Direct air capture with CO2 storage (DACCS) and Bio-energy with Carbon capture and storage (BECCS). FLAG v1.2 explicitly aligns with the LSRS, and companies with existing SBTi targets in FLAG-relevant sectors must align their inventory accounting at their five-year review period.
Forest carbon accounting, however, was not included in this version. This is a significant omission given forests account for the majority of land-sector mitigation potential identified by Griscom et al. (2017), and avoided deforestation represents some of the largest available pathways. GHG Protocol has launched a Request for Information on how forest carbon accounting can best feature in a future update, but until that revision is complete, there is no standardised corporate accounting category for forestry-sector emissions or removals under the LSRS. For companies seeking to source or claim forest-based removals, this creates a structural gap between the project-level carbon standard and the corporate accounting layer that FLAG and SBTi build on.
SBTi’s trajectory points in the right direction with mandatory land-sector targets for FLAG companies, formal recognition of nature-based solutions through OER, and increasing alignment with the GHG Protocol accounting layer. The demand signal, when it materialises at scale from 2027, will be real. But the framework as designed creates a structured obligation for removals and a permissive pathway for forest protection without ever requiring, or specifically incentivising at scale, the financing of standing forests that are under immediate threat.
There is still opportunity to push for change, including in the upcoming consultation on the SBTi Claims System, expected by the end of this year (2026). If the eligibility and recognition criteria that emerge give high-integrity REDD, particularly CCP-labelled credits from projects or jurisdictional programmes, a specific and prominent role within OER, rather than leaving it as one permitted option among many in a framework pointed toward removals, the outcome for forest finance would be different. The NCS Alliance’s argument, that there is no net zero without nature, and that nature needs structured demand at the scale of the corporate capital that SBTi can mobilise, needs to be made again at that stage.
The same foundational question applies here as in Article 6.4: the integrity of any forest carbon credit that flows into SBTi-aligned corporate demand depends on the quality of the counterfactual baseline, for removals projects and for projects avoiding deforestation now. Getting the baseline right at the level of rigour that compliance and corporate standards now require is the prerequisite for everything else. That is where belian comes in.
Key references
- SBTi, FLAG Science-Based Target-Setting Guidance, Version 1.2 (March 2026)
- SBTi, Corporate Net-Zero Standard V2.0, Criteria (11 June 2026)
- SBTi, “Nature and CDR: How SBTi’s Ongoing Emissions Responsibility framework incentivizes both” (2026)
- GHG Protocol, Land Sector and Removals Standard (January 2026)
- NCS Alliance, Statement on the release of SBTi CNZS V2 (June 2026), via WBCSD
- NCS Alliance, Response to SBTi CNZS V2 consultation (August 2025), via WBCSD
- IETA, Response to SBTi CNZS V2 second consultation (December 2025)
- CI, EDF, TNC, WCS, Joint statement on the SBTi Net-Zero Standard, via Nature4Climate
- Sylvera, “The SBTi CNZ V2.0: Analysis of what comes next” (June 2026)
- AlliedOffsets, “SBTi V2.0 and the Voluntary Carbon Market: What the Data Actually Shows” (June 2026)
- Griscom et al. (2017), “Natural Climate Solutions,” PNAS 114(44)
References last reviewed: August 2026.
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