The Science Based Targets initiative (SBTi) is extending the timeline for revising its Corporate Net Zero Standard, aiming for broader consultation. The decision follows internal disagreements over the role of carbon credits in addressing Scope 3 emissions. Companies rely on the standard to align their climate targets with global warming mitigation goals. The organization now plans a more thorough approach, incorporating additional expert input and multiple consultation phases.
SBTi initially introduced its Corporate Net Zero Standard in 2021 to provide companies with a framework for setting science-based decarbonization commitments. In early 2023, it announced plans to update the standard, with a possible revision by 2025. However, controversy emerged in April 2024 when SBTi proposed expanding the use of environmental attribute certificates (EACs), such as carbon credits, to address corporate value-chain emissions. The proposal triggered significant backlash, including internal opposition from staff members, who expressed concerns about the integrity of the standard.
What led to the timeline extension?
Originally scheduled for public consultation in 2024, the draft standard will now be available for review no earlier than March 2025. This change follows internal disputes that escalated into public criticism, with employees reportedly calling for leadership changes. The previous CEO, Luiz Amaral, resigned in July 2024, citing personal reasons. His departure coincided with growing concerns about the organization’s stance on carbon credits.
How will expert input shape the new standard?
To refine the revised standard, SBTi has established Expert Working Groups addressing five key areas. These include carbon credit usage within Beyond Value Chain Mitigation (BVCM) activities, strategies for Scope 2 and Scope 3 emissions, Carbon Dioxide Removal (CDR) approaches, and methods for ensuring data accuracy and claim verification. The organization intends to conduct at least two rounds of public consultation before finalizing the standard.
The controversy around carbon credits centers on their effectiveness in achieving genuine emissions reductions. While proponents argue they provide a viable offset mechanism, critics claim they allow companies to delay substantial internal reductions. Following backlash, SBTi has indicated it may reconsider its approach to carbon credits in the upcoming standard.
To minimize disruptions for businesses already aligning with the existing standard, SBTi stated that new commitments will remain consistent with previous targets. This approach seeks to maintain corporate engagement while refining methodologies for emissions accounting and mitigation.
Tracy Wyman, Chief Impact Officer at SBTi, commented:
“Reaching net-zero is never going to be straightforward. But the guidance to get businesses there should be. The additional consultations announced today will support the development of a revised Corporate Net-Zero Standard that works for businesses and accelerates climate action.”
The extended review process reflects the complexities of corporate decarbonization strategies and the challenges in balancing ambitious targets with practical implementation. The debate over carbon credits highlights broader concerns in sustainability reporting, with critics advocating for stricter measures to prevent potential greenwashing. As the SBTi refines its approach, companies will need to navigate evolving standards while ensuring transparency in their emissions reduction plans.
