SBTi is replacing its one-time validation model with a cyclical process

There are now tree approaches to reduce Scope 1 Emissions:

1. Reducing emissions on a linear pathway to net-zero
2. Increasing the share of low-carbon activities over time
3. Implementing Asset Decarbonization Plans, a company-specific carbon budget linked to investment and retrofit decisions

This latest draft expands to a full framework where electricity purchases (Scope 2) now come with stricter integrity rules:

• Companies must reach 100 % low-carbon electricity by 2040.
• Energy contracts must be geographically matched to where power is used.
• Hourly matching of renewable generation and consumption will phase in from 2030 (50 %) to 2040 (90 %). This means companies should align when their renewable electricity is generated with when they use it.
• Eligible generation sources must be new or re-powered within 10 years, tightening to 5 years by 2035. This means when you buy renewable energy or certificates, they must come from power plants that are newly built or re-powered (upgraded) within the last 10 years.
• “Low-carbon electricity” is defined as ≤ 0.024 kg CO₂ per kWh.

1. Focus on significant sources
   The old rule - covering 67 % of total Scope 3 emissions - is gone. Now, companies must target all categories that represent at least 5 % of their total Scope 3 footprint.
2. Three target-setting types:
   • Emissions intensity targets - cut CO₂ per unit of product or service.
   • Activity alignment targets - increase the share of sourcing or transport already meeting SBTi benchmarks.
   • Counterparty alignment targets - ensure suppliers and customers have validated science-based targets, with expectations cascading through the chain.
3. Limited use of high-quality environmental attribute certificates. (EACs)
   EACs act like receipts proving that a credible low-carbon action happened somewhere in the value chain. This flexibility allows companies to choose the approach that best fits their influence - from direct operational control to supplier engagement.

• Category A companies (large companies, and medium-sized companies in high-income countries) are required to address part of their ongoing emissions with removals from 2035 onwards. This is designed to increase progressively each year until net-zero is reached.
• Every other company takes part in a two-tiered recognition system:
  • Recognized
    Requirement: Take responsibility for at least 1 % of ongoing emissions.
  • Leadership
    Requirement: Take responsibility for 100 % of ongoing emissions.

One of the biggest changes between the March and November drafts is that SBTi moved from guidance to governance. The March 2025 draft outlined principles for monitoring and reporting, but left most of the “how” undefined.
The November 2025 draft turns those principles into enforceable requirements that determine how companies prove progress, get re-validated, and talk about their achievements publicly.

• Performance tracking:
  Introduces quantitative formulas (Annex C) for assessing progress against targets.
• Assurance:
  Independent third-party verification is now mandatory, at least at a “limited assurance” level (i.e. an independent verifier checks your emissions and target-progress data and finds no evidence of major errors).
• Renewal validation:
  Required every five years to update targets and confirm ongoing alignment.
• Claims framework (Annex D):
  Sets approved language for what companies can publicly claim - from “target validated” to “net-zero achieved.”
• Disclosure:
  All validated companies must publish their target data and progress within six months of validation.