The Science Based Targets initiative has had a dense first half of 2026. Two significant frameworks landed in quick succession, an updated version of the Forest, Land and Agriculture (FLAG) Guidance in March, followed by the long-awaited Corporate Net-Zero Standard Version 2.0 in June. Together, they reshape what credible corporate climate action looks like, and they carry direct implications for how nature-based projects like ours are valued, counted, and integrated into corporate strategies.
Here is what changed, and why it matters.
The land sector can no longer be treated as an afterthought
The SBTi’s FLAG framework was designed to close a long-standing gap: most corporate emissions inventories simply ignored land-use emissions, despite the fact that agriculture, forestry, and related sectors account for close to a quarter of global greenhouse gas output. FLAG changed that by requiring companies in land-intensive sectors to set science-based targets that cover this portion of their footprint, including both emission reductions and land-based carbon removals.
In March 2026, the SBTi published FLAG Guidance Version 1.2. The update is now in immediate effect, and any company submitting FLAG targets from 2026 onwards must comply with the revised requirements. Among the key changes: companies setting FLAG targets for the first time are granted up to two years post-submission to eliminate deforestation from their supply chains, but there is an absolute global cut-off date that applies regardless. The update also brings FLAG into alignment with the newly published GHG Protocol Land Sector and Removals Standard, an important step toward consistency across the frameworks that institutional buyers and sustainability teams actually use.
The practical takeaway is straightforward: land-sector decarbonisation is now a formal, auditable requirement for a growing list of companies, not an optional commitment to disclose in a sustainability report and quietly revisit later.
The Corporate Net-Zero Standard gets a structural overhaul
On June 11, the SBTi released Corporate Net-Zero Standard Version 2.0, its most substantive update since the original framework launched in 2021. The revision followed two years of public consultation and two draft versions. It introduces several changes worth understanding.
A best-efforts principle. One of the more pragmatic additions is explicit recognition that companies setting ambitious targets in good faith may face implementation barriers outside their control, supply chain constraints, technology gaps, long capital cycles. Under V2.0, companies that demonstrate genuine effort but fall short of a target can remain within the SBTi framework, provided they are transparent about barriers and the actions they are taking to address them. This does not lower the ambition bar; it acknowledges implementation reality.
Differentiated requirements by company size and geography. V2.0 introduces a two-category system. Category A covers large companies in all countries and medium-sized companies in high-income countries. Category B covers smaller companies and medium-sized companies in lower-income economies. Near-term Scope 3 targets remain mandatory for Category A companies; Category B companies are strongly encouraged but not yet required to go beyond Scope 1 and 2. This matters because it shifts Scope 3 pressure directly onto the larger buyers of agricultural commodities, manufactured goods, and land-intensive inputs.
Carbon credits get a clearer role, and a firm limit. Credits remain excluded from near-term Scope 1, 2, and 3 target compliance. What V2.0 introduces is a voluntary recognition mechanism called Ongoing Emissions Responsibility (OER), through which companies can demonstrate they are addressing the gap between current emissions and their net-zero trajectory through investments in carbon credits or other verified contribution pathways. In addition, large companies will be required to neutralise a minimum of 1% of their total footprint annually from a start date of 2035, rising progressively through to their net-zero year. This neutralisation must use high-integrity, independently verified carbon removals, not avoided emissions, not offsets.
Transition timeline. Version 1.3.1 remains the valid submission framework throughout 2026. From Q1 2027, companies can choose to submit under either version. From February 1, 2028, V2.0 becomes mandatory for all new target submissions.
What this means for reforestation and removals
The SBTi has been careful to keep the distinction between mitigation and removal intact. Credits cannot be used to claim reductions against scope targets. What V2.0 opens up is a growing, structured demand channel for verified carbon removals to support the OER mechanism, a voluntary programme today, a mandatory one from 2035 for large companies.
For land-based projects operating under rigorous methodologies, VERRA ARR standards, GHG Protocol-aligned accounting, verifiable additionality, this is the direction of travel: removals that are permanently retired, independently verified, and aligned with national climate frameworks. The FLAG Guidance further reinforces that for supply chains with direct land exposure, removals are part of the target architecture, not a compensatory afterthought.
At Investancia, our work in native reforestation and regenerative agroforestry in the Paraguayan Chaco sits at the intersection of these two frameworks. Our projects generate verified carbon removals from ecosystems that are among the most threatened on the continent. As the SBTi tightens what counts, and the OER mechanism begins to formalise corporate demand for high-integrity removals, the quality and traceability of the underlying project matters more, not less.
A note on timing
Both updates arrive during London Climate Action Week 2026, where the SBTi is also present. The convergence is not coincidental. The frameworks that define corporate climate credibility are moving forward, and the gap between strong commitments and credible delivery is narrowing. For buyers, investors, and project developers alike, the question is no longer whether land-based carbon will be part of net-zero strategies. It is whether the projects in your portfolio can withstand the scrutiny of a framework that was designed with permanence, additionality, and integrity as non-negotiables.
