SBTi in practice: science-based targets and Scope 3

A major customer or investor asked whether you have an SBTi target. You replied that you would look into it, and now you are facing a process you have never done before. SBTi (Science Based Targets initiative) is the world’s most widely used validation body for science-based climate targets, and its Corporate Net-Zero Standard defines how a company sets targets aligned with the Paris Agreement. This article walks through what SBTi requires, how Scope 3 targets are set, and how the V2 standard transition timeline affects a company starting the process now.

What SBTi is and why it matters

Science Based Targets initiative is a joint initiative of CDP, UN Global Compact, World Resources Institute, and WWF that validates companies’ climate targets for alignment with the Paris Agreement 1.5 °C pathway. More than 9,000 companies worldwide have committed to the SBTi process or have already had their targets validated.

SBTi’s strength is that it is independent and technically rigorous. A company’s published target of “we will be carbon neutral by 2030” means nothing without external validation. SBTi validation gives the target credibility with investors, customers, employees, and partners.

In 2026, SBTi is gaining particular prominence through CSRD reporting and supply chain requirements. Large companies are requiring SBTi targets from their suppliers, and lenders are favouring SBTi-validated companies in credit decisions.

The SBTi process in four steps

The SBTi process follows the same structure for all companies regardless of size. There is a simplified route for SMEs that accelerates the process.

1. Commit. The company announces its commitment to the SBTi process. After this, the company has 24 months to submit targets ready for validation.

2. Develop. The company calculates its emissions (Scope 1, 2, and material Scope 3) and develops targets in accordance with the required methodology. This is in practice the most labour-intensive step, and a consultant typically helps here.

3. Submit and validate. The company submits its targets to SBTi for validation. SBTi reviews the methodology, coverage, and level of ambition. Validation typically takes 30–60 days.

4. Communicate and disclose. The validated target is published on SBTi’s website and through the company’s own channels. The company reports annually on progress.

What Scope 3 targets require under V1.3

Under Corporate Net-Zero Standard V1.3, a Scope 3 target is mandatory if Scope 3 emissions exceed 40% of total emissions (Scope 1+2+3). In practice this applies to nearly all companies, from service businesses to manufacturing.

The target must cover at least 67% of total Scope 3 emissions. Coverage is calculated category by category, including the largest categories until the 67% threshold is met.

The target level must be compatible with the 1.5 °C pathway. In practice this means a near-term target of at least 4.2% annual reduction (Scope 1+2) and equivalent ambition for Scope 3. A net-zero target for 2050 (or earlier) is mandatory.

Corporate Net-Zero Standard V2: transition timeline

SBTi published Corporate Net-Zero Standard V2.0 in June 2026. The previous V1.3.1 standard continues to apply during the transition period, and validation under V2.0 will open gradually during 2027.

The transition timeline is:

Targets under V1.3.1 and new V1.3.1 applications remain valid until 31 December 2027. A company with a validated V1.3 target can continue reporting under that standard.
Validation under V2.0 opens early 2027 and becomes mandatory for new targets from early 2028. Targets set before that date can be validated under V1.3.1.

The most significant changes in V2.0:

Scope 3 coverage shifts from 67% total coverage to a materiality-based approach. Targets must in principle be set for all categories that represent at least 5% of total Scope 3 emissions. This would extend coverage for most companies.

The category-specific approach also brings differentiated target methodologies (e.g. sector-specific approaches for industries such as forests, food, and finance). SBTi’s Net-Zero documentation contains the details of V2.0.

In practice: companies starting the SBTi process now can still validate under V1.3.1 until the end of 2027 and transition to V2.0 at the next update, or opt directly for V2.0 if the timeline allows. We will review your situation at the start of the project and recommend the most suitable route.

What the SBTi process costs and how long it takes

SBTi validation is subject to a fee. The fee varies depending on company size and process type. Check the current fees on SBTi’s own website before starting the process.

The SBTi process typically takes the following time:

Preparing the emissions calculation and building Scope 3 coverage: 3–6 months if no baseline calculation exists.
Developing targets and obtaining internal approval: 2–4 months.
SBTi validation: 30–60 days from submission, typically longer if comments and revisions are required.

In total, a realistic timeline is 6–12 months from commitment to publication of the validated target.

NGS’s role: preparation, not validation

SBTi is not a consultant but a validation body. The consultant’s role is to prepare the calculation and targets so that the application passes on the first attempt.

NGS’s role typically includes:

Performing the emissions calculation (Scope 1, 2, and material Scope 3) for the baseline year.
Building Scope 3 coverage and category-level figures so that they meet SBTi’s requirements.
Selecting the target methodology (absolute contraction, intensity-based sector models, FLAG, etc.) and performing the calculation.
Preparing and submitting the application to SBTi.
Supporting during the validation process if SBTi requests clarifications.

The client retains management approvals, internal communications, and ongoing monitoring. NGS cannot guarantee that validation will be approved, as the decision rests with SBTi, but carefully prepared applications typically pass without significant revision requests.

Frequently asked questions

Is SBTi mandatory?

There is no legislative obligation. In practice, the requirement comes through other channels: a major customer requires an SBTi target from its suppliers, an investor evaluates its portfolio companies by SBTi status, or a parent company’s net-zero target requires supplier commitment.

Is a Scope 3 target required?

Yes, if Scope 3 emissions exceed 40% of total emissions. Under V1.3, the target must cover 67% of Scope 3. In the V2 draft, the threshold shifts to a category-specific 5% materiality threshold. For most companies Scope 3 exceeds 40%, so a Scope 3 target is needed.

How long does the SBTi process take?

A realistic timeline is 6–12 months from commitment to publication of the validated target, if an emissions calculation is not already in place. If a baseline has already been prepared, the process can be faster.

What does SBTi cost?

SBTi charges a validation fee that varies according to company size and process type. Check current fees on the SBTi website. In addition there are consulting and internal costs, which are typically the larger share of the total cost.

Can an SBTi target be lost?

Yes. SBTi can revoke a target’s status if a company fails to report progress, does not update its baseline under changed circumstances, or does not meet methodology requirements at the point of revision.

Does an emissions calculation need to be ready before starting the SBTi process?

In practice, yes. SBTi requires a baseline-year emissions calculation completed within the last 12 months. Scope 1+2 and material Scope 3 must be calculated before targets can be built.

SBTi preparation without missteps

We ensure that your calculation and targets meet SBTi’s requirements before the application is submitted. Application approved on the first attempt.

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