SBTi’s Net Zero Standard 2.0 and What it Means for SMEs

SBTi Corporate Net-Zero Standard 2.0: What SMEs Need to Know

The Science Based Targets initiative (SBTi) has released the latest draft of Version 2.0 of its Corporate Net Zero Standard, signaling an evolution from simply setting targets to demonstrating credible implementation and measurable progress. While the revised standard remains grounded in climate science, it introduces a more practical and flexible approach and a few changes for small and medium-sized enterprises (SMEs).

Some Changes for SMEs

Among the most significant proposed changes for SMEs is a shift toward shorter target cycles (5 years rather than a 10 year option). In addition, separate emission reduction targets for Scope 1 and 2 emissions are required rather than an aggregated target. Further, companies will be expected to report regularly on progress and to clearly distinguish between actual emissions reductions and any use of carbon credits or other environmental attribute certificates.

The draft also introduces greater flexibility in addressing Scope 3 emissions, allowing companies to focus on the categories that matter most to their overall footprint and to use a broader range of metrics and actions to drive reductions. In this new version, it is still optional for SMEs to set reduction targets, but they nonetheless need to measure and reduce Scope 3 emissions. It is advised that companies focus on significant emissions categories (≥5% of total scope 3, categories 1 to 14), with exclusions on emissions that are not material.

For SMEs, these changes recognize the reality of limited staff and data resources. The new framework encourages businesses to prioritize the actions that will have the greatest impact and to demonstrate continuous improvement over time. At the same time, SMEs should prepare for enhanced transparency and a stronger expectation that climate commitments translate into concrete operational changes.

Organizations that already have validated 10-year targets do not currently need to revise them solely because of the release of Version 2.0. V2.0 validation opens February 1, 2027 and is required for all new submissions from February 1, 2028. Existing targets remain valid under the rules in place when they were approved, and SBTi is expected to provide transition guidance as the new standard is finalized. For now, SMEs should view the proposed five year target cycle as the direction of future practice and begin building the systems needed to update targets and track progress more regularly. In essence, companies can continue using V1 until January 2028. Existing targets set for 2030 or later remain valid until the next target cycle (2030-35).

Key Takeaways for SMEs

The biggest change under Version 2.0 is not the emissions reduction math for Scope 1 and 2. The bigger shift is that SBTi is moving from a target-setting framework to an implementation framework. SMEs will increasingly be expected to show:

1. They understand their emissions profile.

2. They are reducing operational emissions (Scopes 1 and 2).

3. They are prioritizing the reduction of material value-chain (Scope 3) emissions.

4. They are taking practical actions where they have influence.

The Value of Setting a Science-Based Target

Setting a science-based target demonstrates a company's commitment to aligning its greenhouse gas emissions reductions with the latest climate science. The updated framework places greater emphasis on credible, measurable decarbonization strategies, transparent reporting, and ongoing performance improvement, helping organizations move beyond ambition to meaningful action. By establishing science based targets, companies can strengthen stakeholder confidence, prepare for evolving regulatory and investor expectations, enhance resilience to climate-related risks, and identify opportunities for operational efficiencies and innovation. A robust science-based target also provides a clear roadmap for integrating climate action into business strategy and achieving long-term value creation.

How We Can Help

We can support you throughout the science-based target journey, from establishing a comprehensive greenhouse gas inventory and assessing emissions to developing targets that align with the requirements of SBTi Version 2.0. We can identify practical emissions reduction opportunities, engage internal stakeholders, and build implementation roadmaps that balance ambition with operational realities. Beyond target development, we can provide ongoing guidance on emissions tracking, reporting, and continuous improvement..

🌿 For more information and assistance, reach out to Achieve Sustainability for a free consultation here or email us at info@achievesustainability.ca.

Sources

SBTi. (2026a, June). Continuing Use of Corporate Net-Zero Standard Version 1.3.1 and Transition to Corporate Net-Zero Standard Version 2.0. In Science Based Targets Initiative. https://files.sciencebasedtargets.org/production/files/Continuing-Use-of-Corporate-Net-Zero-Standard-Version-1.3.1-and-Transition-to-Corporate-Net-Zero-Standard-Version-2.pdf

SBTi. (2026b, June). The New Corporate Net-Zero Standard Version 2.0. Science Based Targets Initiative. https://sciencebasedtargets.org/corporate-net-zero-standard-v2#3698068

SBTi. (2026c, June 11). Introducing the SBTi Corporate Net-Zero Standard Version 2.0. Science Based Targets Initiative. https://sciencebasedtargets.org/blog/introducing-the-sbti-corporate-net-zero-standard-version-2-0

SBTi. (2026d). SBTi Corporate Net-Zero Standard Version 2.0. In Science Based Targets Initiative. https://files.sciencebasedtargets.org/production/files/Corporate-Net-Zero-Standard-version-2.pdf

SBTi Services. (2026, June). Guide for Companies in the Transition to Corporate Net Zero Standard Version 2.0. In Science Based Targets Initiative. https://docs.sbtiservices.com/resources/GuideTransitionCorporateNetZeroStandardV2.pdf