SBTi 2.0: A More Realistic Path to Net Zero, or a More Complex One?
September 24, 2026
Climate Strategy & Policy
The release of the Science Based Targets initiative (SBTi)'s Corporate Net-Zero Standard Version 2.0 marked the most significant evolution of the framework since its launch in 2021. Rather than focusing solely on target setting, the new standard shifts attention toward implementation, accountability, and the practical realities companies face when pursuing net-zero commitments
For sustainability leaders, the key question is no longer whether SBTi remains the leading corporate climate framework. It is whether Version 2.0 can accelerate real-world decarbonization at a time when many companies are struggling to translate ambition into action.
From Target Setting to Delivery
One of the strongest aspects of SBTi 2.0 is its recognition that climate transitions rarely follow a linear path. The introduction of a "best-efforts" framework acknowledges that companies may face barriers such as technology limitations, supply chain constraints, or lack of available low-carbon solutions. Rather than excluding companies that miss interim targets, SBTi now allows them to remain within the framework if they can demonstrate transparent efforts and disclose implementation challenges
This change is important.
Many companies have struggled with factors outside their direct control, including slow technological development, limited availability of low-carbon materials, uncertain renewable energy infrastructure, and complex Scope 3 supply chains. Punishing companies for these realities risked creating a binary system where organizations either succeeded perfectly or abandoned the framework altogether.
This evolution strengthens the credibility of climate action by focusing on continuous progress rather than creating a binary pass-or-fail system. However, the success of this approach will depend heavily on how the forthcoming assurance framework defines what constitutes genuine "best efforts." If requirements are too loose, credibility may suffer. If they are overly restrictive, companies could continue facing the same barriers that discouraged participation under previous versions.
The Most Important Shift: Carbon Credits Enter the Conversation
Perhaps the most consequential development is SBTi's new Ongoing Emissions Responsibility (OER) framework. While emissions reductions remain the priority, the standard now formally recognizes the role of climate finance and carbon crediting in addressing emissions that companies continue to generate during their transition.
This is an important signal for the market.
Reducing emissions and financing climate action should be complementary strategies, not mutually exclusive choices.
For years, the climate debate has often framed emissions reductions and carbon credits as competing approaches. SBTi 2.0 takes a more pragmatic position: companies need both. Internal decarbonization remains essential, but financing mitigation and removal activities outside the value chain can also contribute to limiting global warming while companies continue their transition.
The new OER recognition system introduces three participation levels, ranging from "Engaged" to "Leadership," creating a pathway for companies to support climate action long before their net-zero year arrives.
Why Early Carbon Market Engagement Matters
While the inclusion of carbon credits is a positive step, there is a challenge that deserves far greater attention.
SBTi 2.0 creates a pathway that is likely to increase future demand for both mitigation and removal credits, particularly as the mandatory removal requirements for larger companies begin after 2035 and progressively increase toward net-zero target years
Yet there remains an unresolved question:
Will sufficient high-quality supply exist when that demand materializes?
The carbon market has repeatedly experienced periods where demand signals arrived too late to stimulate project development at the scale required. High-integrity nature-based projects, engineered removals, and durable carbon removal technologies often require years of development, permitting, financing, monitoring systems, and operational scaling.
Waiting until compliance-like demand emerges may prove risky.
A reasonable interpretation of SBTi 2.0 is that companies should begin engaging with carbon markets much earlier than the standard strictly requires. Early participation can:
- Support project development today.
- Improve future supply security.
- Generate learning and organizational capability.
- Help companies understand quality distinctions across carbon assets.
- Reduce future exposure to price volatility.
In other words, if companies believe removals will eventually become a strategic necessity, delaying engagement until the 2030s may be economically and operationally suboptimal.
The market needs demand signals before it needs credits.
A Standard Designed to Broaden Participation
Another major innovation is the introduction of differentiated requirements for large corporations and smaller businesses. By creating separate categories, SBTi aims to reduce barriers for SMEs and companies in emerging markets that have historically been underrepresented in science-based target-setting.
This could significantly increase participation as before, smaller companies have been underrepresented in science-based target initiatives because the financial and technical burden of compliance can be significant. Lowering barriers may substantially increase participation among organizations that previously viewed SBTi as unattainable.
However, it may also create a different challenge. Category A companies face more extensive requirements related to Scope 3 emissions, reporting, assurance, transition planning, and future OER obligations.
While these requirements improve rigor, they also increase complexity and cost. As organizations navigate overlapping frameworks such as CSRD, ISSB, and other climate disclosure regulations, some companies may question whether the benefits of SBTi validation remain sufficient to justify the additional effort.
The long-term success of Version 2.0 will therefore depend on whether companies perceive participation not only as a sustainability exercise, but as a source of risk management, competitive advantage, and investor credibility.
This creates an important strategic question:
Are the incentives strong enough to offset the growing complexity?
SBTi recognition remains valuable, but many companies now face multiple reporting frameworks, limited sustainability budgets, and increasing scrutiny regarding implementation costs.
The long-term success of Version 2.0 may depend less on scientific rigor and more on whether companies clearly perceive commercial, risk management, financing, and reputational benefits from participation.
What This Means for Carbon Markets
Perhaps the most important takeaway is that SBTi 2.0 is no longer simply a target-setting standard.
Market observers have noted that even achieving the entry-level OER recognition threshold could bring thousands of new buyers into voluntary carbon markets, while the longer-term removal requirements may become a powerful catalyst for investment in high-quality removals.
Yet demand alone will not solve the challenge. The market will need sufficient volumes of credible, high-integrity projects, particularly removals, to meet future corporate needs.
For project developers, carbon suppliers, and climate solution providers, the opportunity may therefore lie less in selling credits and more in helping companies build long-term carbon procurement, removal, and climate contribution strategies.
Final Thoughts
SBTi Corporate Net-Zero Standard 2.0 should not be viewed as a weakening of corporate climate ambition. Rather, it reflects a growing recognition that the path to net-zero is more complex than originally anticipated.
The framework's greatest strength may be its acceptance that companies need multiple tools to contribute meaningfully to climate goals: direct reductions, supply chain engagement, clean energy procurement, transition planning, and climate finance through high-integrity carbon markets.
For carbon markets, the most important takeaway may be that the future demand story is becoming clearer. The uncertainty is no longer whether companies will eventually need carbon removals and climate contributions. The uncertainty is whether enough organizations will engage early enough to help build the supply required for a credible net-zero economy.
