SBTi Net-Zero Standard Version 2.0 (Consultation Draft): What’s Changing and What Businesses Should Know
In November 2025, the Science Based Targets initiative (SBTi) released the second consultation draft of its updated Corporate Net-Zero Standard (Version 2.0). This is one of the most important updates to the global net-zero architecture since the original 2021 Standard, and it signals major shifts in how companies will be expected to set, validate and renew science-based targets in the years ahead.
I’ve spent the past few days deeply reviewing the draft, and in this article tackle the task of demystifying. Here’s how I will break it down:
What Version 2 changes (in clear terms)
How it differs from Version 1
What companies should be watching
Why this matters for corporate climate strategy
Whether you’re new to SBTi or already operating with validated near-term and long-term targets, this draft marks a meaningful evolution.
What Version 2.0 Is Trying to Achieve
In its current draft form, Version 2.0 aims to strengthen the net-zero framework by:
Clarifying ambition and aligning with the latest climate science
Expanding credible mitigation levers, such as asset-level decarbonisation
Embedding a cyclical validation model (Entry Check → Initial Validation → Renewal Validation)
Driving continuous improvement and accountability through periodic reassessment
Creating stronger links with transition planning and internal governance
These updates indicate a clear move toward greater rigour, transparency, and long-term accountability for companies.
Version 1 vs Version 2: What’s Changing?
Below is a breakdown of what I think are the most significant updates.
(a) A New Cyclical Validation System
Version 1 relied on a single validation process with periodic updates. Version 2 introduces a three-stage cyclical model:
Entry Check – readiness and baseline assessment
Initial Validation – full assessment against the Standard
Renewal Validation – reassessment of progress and re-validation of targets every cycle
Plus spot checks may occur at any time! This is a major accountability upgrade. Companies will now be required to demonstrate ongoing progress, not just set-and-forget targets.
(B) Category A vs Category B Companies
Version 2 splits companies into two categories:
Category A – large companies, and medium-sized companies in high-income countries
Category B – medium companies in middle- and low-income regions, and all small & micro companies
Category B receives proportionate flexibility, acknowledging capacity constraints. This is one of the biggest structural changes and has implications for timelines, assurance expectations, and data requirements.
(C) Expanded Scope 1 Target-Setting Options
Version 1 primarily relied on linear reduction pathways. Version 2 adds three new approaches:
Linear reduction pathway
Increasing share of low-carbon activities
Asset Decarbonization Plans (ADPs) allowing companies to decarbonise assets based on technology readiness and bespoke carbon budgets
This is a major improvement, especially for hard-to-abate sectors.
(D) Stronger Rules for Scope 2 and the Use of EACs
Version 2 explicitly notes ongoing updates to the GHG Protocol Scope 2 guidance, and signals stricter expectations for electricity market instruments. This suggests that companies relying heavily on market-based certificates may need to rethink strategy.
(E) Much More Detailed Scope 3 Architecture
Version 2 expands Scope 3 guidance by:
Defining activity pools (a new structural element)
Requiring clear reporting on activity-, supplier-, and sector-level impacts
Creating more clarity around intensity vs absolute targets
Increasing requirements for transparency
This provides more structure, but also more complexity.
(F) New Framework for “Taking Responsibility” for Ongoing Emissions
Version 1 offered limited guidance on voluntary contributions. Version 2 introduces:
Optional recognition labels (Recognised, Leadership)
Requirements to fund mitigation outcomes or climate finance
A post-2035 mandatory requirement for Category A companies
Clear disclosure rules for mitigation volumes and financial contributions
This is one of the most significant conceptual updates.
(G) Stricter Rules on Integrity, Verification and Third-Party Assurance
Version 2 emphasises:
Verifiability of performance
No use of beyond-value-chain outcomes to meet inventory reductions
Mandatory third-party assurance for Category A companies
Strong rules on base year recalculations
This increases credibility but adds additional burden.
What This Means for Companies Today
While this is still a draft, several themes are clear.
Expect More Accountability and More Frequent Reporting
With renewal validation and tighter rules, companies must shift from “we set targets” to:
“we demonstrate ongoing progress”
“we adjust when circumstances change”
“we disclose transparently”
Companies With Weak Scope 3 Strategies Need To Strengthen Them
The expanded Scope 3 architecture means:
better data
strong supplier engagement
clearer prioritisation
more structured alignment pathways
…will be essential.
Voluntary Climate Finance Is Becoming Mainstream
The new recognition system is a precursor to:
wider voluntary contribution frameworks
stronger expectations for beyond-value-chain mitigation
This signals a philosophical shift. Companies are expected to contribute to global climate solutions, not just reduce their own footprint.
Companies in Hard-to-Abate Sectors Gain More Flexibility
The new asset-based pathways give industries like steel, chemicals, cement and aviation a more realistic way to set credible targets.
What I Will Be Watching as the Consultation Continues
A few areas stand out as particularly impactful:
The final definition of “taking responsibility” and the thresholds for recognition
Alignment with upcoming GHG Protocol updates (especially for Scope 2)
How SBTi manages the administrative burden for SMEs (Category B)
The rollout timeline for Version 2 and how quickly Version 1.3 will be phased out
This draft is dense, ambitious, and still evolving, but it marks a major step toward a more mature, credible net-zero standard.
As someone who advises companies on net-zero pathways and ESG strategy, I see this update as both a challenge and an opportunity. Challenge, because it raises expectations, clarifies ambiguity, and demands more transparency. Opportunity, because companies that respond early with structured, science-aligned strategies will be positioned as leaders long before Version 2 becomes the formal standard.
For now, this consultation draft is a clear signal. Credible net-zero strategies are entering a new chapter.
If you want support interpreting the changes or preparing for Version 2, feel free to reach out.
