SBTi Updates: From Declaration to Delivery

For years, the climate target has sat at the center of corporate climate work.

Building on the Paris Agreement in 2015, the Science Based Targets initiative has given companies a framework for setting decarbonisation targets aligned with climate science.

Near-term reductions by 2030.
Net zero by 2050.
A science-based pathway.
A public commitment to a safer future.

These commitments matter. A target can give direction, create accountability and pull an organisation out of drift. It can help allocate budget, focus leadership attention and turn decarbonisation into a business priority.

But a target is not the transition itself.

A target does not change a boiler, redesign a product, reroute freight, renegotiate a supplier contract or choose one material over another.

That is the quiet force of SBTi’s Corporate Net-Zero Standard V2.0, released earlier in June 2026.

The updated standard makes clear that the focus is moving beyond declaration to delivery.

A New Order of Action

At the heart of the updated standard is an implementation hierarchy.

The idea is simple: not all climate action carries the same weight.

Companies are expected to prioritise actions that directly reduce emissions from their own operations and value chains before turning to more indirect forms of action.

“Companies shall prioritize activity-level actions to reduce emissions from their operations and value chains before pursuing more indirect action.” — CNZS-C21

In practice, this means starting with the things a business can actually change.

First, Reduce at Source

The first priority is activity-level action: reducing emissions directly at source.

That could mean improving efficiency, switching fuels, electrifying equipment, changing materials, redesigning operations, reducing waste, rethinking logistics or working with suppliers to change how goods and services are produced.

This is where climate work stops being a target on a page and starts becoming business decisions.

Because emissions are not abstract. They are embedded in procurement, energy, freight, facilities, product design, operations and capital decisions. They sit inside the ordinary choices a company makes every day.

A good emissions inventory should not only produce a number. It should show where emissions are concentrated, which sources matter most, and where action can reduce both emissions and risk.

Then, Work within Shared Systems

Not every emissions source can be reduced immediately by one company acting alone.

Some sit inside wider systems: aviation, shipping, agriculture, construction materials, grid infrastructure and commodity markets. A single company may influence these systems, but not fully control them.

This is where activity-pool or sector-level action becomes relevant.

Where direct reductions are not yet feasible, companies may need to support lower-carbon alternatives across shared systems, sectors or value chains.

Value chains are made up of hundreds, sometimes thousands, of relationships. Collaboration across them will be crucial. No company can decarbonise a complex value chain by sending one supplier questionnaire and hoping for the best.

But this is not a loophole.

System-level action should sit behind a clear understanding of what can be reduced directly, what cannot yet be reduced, and why.

Finally, Be Clear About Compensation

Compensation sits outside the core task of reducing emissions inside the business and value chain.

This does not mean climate finance has no role. It does. But compensation cannot be asked to carry the weight of transformation if the business itself has not begun to change.

Offsets, removals, certificates and other forms of climate finance need to be treated carefully and transparently. They should not blur the line between what has been reduced in the company’s own operations and value chain, and what has been compensated for elsewhere.

The integrity lies in the sequence:

Reduce emissions inside the business and value chain wherever possible.
Be transparent about the emissions that cannot yet be reduced, and why.
Support wider system change where direct action is constrained.
Then account clearly and separately for any compensation, removals, certificates or climate finance used in relation to ongoing or residual emissions.

The test is simple: has anything actually changed, or has the accounting just got more complicated?

Credible Targets Need Credible Data

The updated standard also makes something explicit that has always been true: credible targets require credible data.

“Companies shall account and report a GHG emissions inventory aligned with the GHG Protocol Standards.” — CNZS-C5

Your base year inventory is the foundation everything else is built on.

If the inventory is weak, the target will be weak.

If the data is too high-level, the reduction plan will be too high-level.

If material Scope 3 categories rely mainly on estimates, the business may not know which actions will actually move the result.

Building a more accurate inventory gives a business the confidence to make targeted decisions: to know where emissions are concentrated, where change is possible, and where action can create genuine impact.

That is particularly important in Scope 3.

For many companies, a significant share of their emissions profile sits in Scope 3. It is often where the most important reductions need to happen, and also where measurement is hardest. Value chains are complex, supplier data varies in quality, and broad averages can hide what is really changing in the market.

At The Lever Room, Scope 3 measurement has been central to our carbon management programme since its inception. Our focus is on helping organisations measure full value chain emissions and build inventories that do more than satisfy reporting requirements. They help companies understand the systems they rely on, the suppliers they influence, and the commercial decisions that shape their climate impact.

Better Scope 3 Data Enhances Decision Intelligence

The difference between an estimated inventory and a decision-ready inventory can be significant. One New Zealand’s carbon reporting offers a useful example.

Like many telecommunications businesses, a large part of One NZ’s footprint sits beyond its direct operations. It is shaped by the products it sells, the infrastructure it depends on, and the global technology companies within its value chain.

That complexity is exactly why Scope 3 measurement matters.

For One NZ, improving the quality of data behind purchased products, including customer devices, meant the inventory could move beyond broad averages and better reflect the specific products moving through the business.

That matters because value chains are not static.

When manufacturers such as Apple and Samsung reduce the emissions associated with their own operations and products, that progress can flow through into the inventories of the companies that sell, use or rely on those products.

This is part of the collective power of science-based targets.

A single company’s decarbonisation does not stop at its own boundary. When suppliers reduce emissions, customers can see that progress reflected in their Scope 3 footprint. When customers ask for better data, suppliers have a stronger commercial reason to improve. Over time, the target becomes more than a commitment made by one organisation. It becomes a signal moving through the value chain.

For One NZ, using more product-specific data helped create an inventory that more accurately reflects the state of the technology sector and the direction it is moving in.

It shows where emissions are today.
It captures where suppliers are improving.
It helps the business understand which commercial choices influence emissions over time.

This is what good Scope 3 measurement should do. It should expose the real systems a company is part of, the progress already underway, and the decisions that can accelerate it.

The Plan Becomes the Proof

Under V2.0, setting a target will require more than ambition.

The new reduction plan requirements mean companies will need to look more closely before they commit: testing the pathway, understanding what delivery would involve, and showing that the target is backed by a credible plan.

That plan does not need to pretend everything is solved. In fact, a plan that pretends everything is solved probably should not be trusted.

The useful plans are usually the honest ones. They distinguish between actions already underway, actions that require investment, actions dependent on suppliers, actions waiting on technology or infrastructure, and actions that remain unresolved.

That honesty matters. It helps climate work move out of the sustainability team and into the decisions that shape emissions: procurement, finance, operations, product, logistics, legal, risk and leadership.

A lease is signed.
A fleet is renewed.
A supplier is selected.
A product is redesigned.
A market is entered.

These are all climate decisions, whether or not they are labelled that way.

What This Means for Companies

For companies that already have science-based targets

For companies that already have science-based targets, this is a moment to look beneath the surface.

• Does the current inventory support the ambition?

• Is the reduction pathway specific enough?

• Are Scope 3 assumptions robust?

• Are claims clear about the difference between reductions, system-level action and compensation?

• Can the business explain what has already changed, what is planned, and what remains difficult?

Companies with 2030 targets should continue to use Version 1 for the current target cycle. The priority is to strengthen the evidence base behind existing targets, while preparing for the next cycle. From 2028, these companies should start setting targets for the next period, typically 2030–2035, to allow sufficient lead time for implementation. In the meantime, and for the remainder of the current target cycle, relevant innovations from the Corporate Net-Zero Standard V2.0 are expected to be available to users of Version 1.

For companies preparing to set science-based targets

For companies preparing to set science-based targets, timing matters.

Version 2.0 has now been published. SBTi Services is expected to open validation against V2.0 in Q1 2027. Companies setting targets in 2026 are expected to continue using the currently applicable standard, V1.3.1. Submissions under V1.3.1 remain open until 31 January 2028. After that, V2.0 becomes mandatory for all new submissions.

That may sound like a generous amount of time.

It is not.

Improving data, building internal ownership, understanding Scope 3 and aligning climate ambition with commercial strategy all take longer than most companies expect.

The organisations that wait until submission may find they are not short on ambition. They are short on evidence.

Climate Work as Commercial Intelligence

There is a narrow way to read the updated standard: as another set of requirements to interpret, document and submit.

There is also a more useful way to read it: as a signal that climate work is maturing.

Good carbon data can show where a business is exposed to energy volatility, supplier risk, customer scrutiny, regulation and shifting market expectations.

A good reduction plan can help prioritise investment, strengthen tenders, protect customer relationships and make sustainability claims more defensible.

A good target can become a management tool. Not a sentence on a website, but a way of deciding what the company builds, buys, sells, funds and leaves behind.

Where to Start

Start with the foundation.

Review your base year inventory. Test the quality of your data. Identify material emissions sources. Understand where estimates are doing too much work. Map the actions that can reduce emissions directly. Separate what is within your control from what depends on wider systems. Be clear about where compensation fits, and where it does not.

Then turn the target into a plan the business can actually use.

At The Lever Room, we help organisations build the evidence, strategy and reduction plans behind credible climate commitments. That includes carbon measurement, Scope 3 analysis, SBTi preparation, transition planning, climate claims and commercial sustainability strategy.

We specialise in full value chain measurement, helping companies move beyond high-level estimates to inventories that are accurate, useful and commercially relevant.

Because under V2.0, credibility will not come from the target alone.

It will come from the quality of the data behind it, the strength of the plan around it, and the decisions that follow.