Scope 3: Flexibility and Data Quality —Two Key Elements of the New SBTi Corporate Net Zero Standard
- Federico Cavallucci
- Apr 24
- 3 min read
Updated: Apr 28
Blog by Federico Cavallucci, Senior Consultant for corporate climate strategies
The draft of the new SBTi Corporate Net-Zero Standard has been released and it brings about a comprehensive overhaul of the methodologies and tools used throughout the journey to net zero emissions, from commitment to target-setting to achieving those targets. The aim of updating the standard is to make it more relevant, robust, and practical, enabling more companies—large, medium, and small— than ever before to set and deliver ambitious, science-based targets. In this context, companies have long regarded scope 3 emissions as the greatest hurdle to set targets with the SBTi, for fear of not being able to achieve substantial progress with their scope 3 emissions. In response, the SBTi has introduced key updates on target-setting methodologies and overall mitigation strategy.
In our latest climate blog, our expert, Federico Cavallucci, weighs in on the SBTi’s Net-Zero Standard—let’s have a closer look at some of the key changes:
Prioritizing Emission-Intensive Activities
Instead of using a fixed percentage as blanket threshold for scope 3 emissions coverage, the new standard encourages companies to focus on the most emission-intensive activities within their value chain. This means looking at where the biggest impacts are and prioritizing those areas. For example, if the transport of purchased goods plays an important role in the scope 3 inventory, the targets would have to include this category. By prioritizing relevant emission sources and setting aside minor sources, a company can design a decarbonization strategy that is more focused and streamlined.
Carbon Removals
While removals are an integral part of net-zero targets, so far, the SBTi had been focused solely on removals from the net zero target year onwards, without mandating any removals before that date. The new draft of the standard introduces the requirement for a gradual scale-up of removals during the transition to net zero, as well as a mechanism to use removals to address any emissions overshoot after each target cycle, in an effort to fix shortfalls in progress against the targets. Besides the topic of removals, the standard introduces new incentives for companies to engage in climate protection projects and Beyond Value Chain Mitigation (BVCM) in their transition to net-zero. In a follow-up piece, we will be covering all the nuances behind removals and BVCM.
Flexibility in Target-Setting Methods
The standard draft offers different methods for setting scope 3 targets, including absolute emissions reduction, intensity reduction, and alignment metrics. This flexibility allows companies to choose the approach that best fits their operations and data availability. In the example of transport of purchased goods, a company might set a target to reduce the emissions intensity of maritime transport (tonnes of CO2e per tonne and nautical mile) and aggregate the remaining emissions from other types of transport in a single, separate scope 3 target.
Improving Data Quality and Reliability
The current standard gives only limited space to the topic of data quality, whereas the new draft standard requires companies to develop a plan to improve data quality over time. For larger companies, a requirement for third-party assurance of the GHG inventory is also introduced, with the aim of improving the quality of their GHG inventory.
Conclusion
In conclusion, the new SBTi Corporate Net-Zero Standard represents a significant advancement in the journey towards net-zero emissions. By prioritizing emission-intensive activities, offering flexibility in target-setting methods, and emphasizing the importance of data quality and reliability, the standard provides companies with practical and robust tools to set and achieve ambitious, science-based targets. It is important to keep in mind that the new standard, once confirmed, will be only active from 2027 onwards.
This should not deter you from setting SBTs: Near-term targets set in 2025 and 2026 under the existing rules will in fact remain valid for five years or until the end of 2030, whichever is earlier.
About the Author
Federico Cavallucci is a senior consultant for corporate climate strategies, specializing in carbon accounting and climate target development. With a dedicated focus on the manufacturing and energy sectors, he guides clients through their decarbonization journey, leveraging his expertise to implement sustainable practices and achieve climate goals. Prior to joining First Climate in 2022, Federico served as an environmental specialist at Saipem, where he focused on the company’s decarbonization strategy.
