The Natural Climate Solutions Alliance’s perspective on the role of high-integrity carbon credits and natural climate solutions
SBTi’s Corporate Net-Zero Standard Version 2 is a milestone, but not because it changes the core message – reducing emissions is still the priority. What’s new is the Standard finally addresses a question businesses have been asking for a while: what do you do about the emissions still left while you’re getting to net zero?
That’s Ongoing Emissions Responsibility (OER). It starts from a simple observation – even an ambitious decarbonisation pathway keeps generating emissions for years – and says companies have some responsibility for those emissions along the way, not just for the destination.
We’ve been talking to businesses across sectors since the Standard came out. The technical detail matters, but conversations keep circling back to the same few questions: what does OER actually mean for us, does it change how carbon credits fit in, and where do natural climate solutions come into this. Here’s what we’re hearing most.
What’s actually changed?
Before Version 2, corporate climate strategy was mostly about reduction targets and a long-term net zero date. Version 2 adds a second track alongside that: keep reducing, but also take responsibility for what’s left in the meantime. OER doesn’t replace reductions or soften them – it sits next to them. The practical effect is that the conversation moves from “what’s our target” to “how are we actually delivering on it.”
Do carbon credits replace emissions reductions now?
No – the one thing worth remembering if you take nothing else from this piece. Deep reductions across operations and the value chain are still the foundation; that expectation hasn’t loosened. High-integrity credits sit alongside that work, not instead of it. Picture it this way: cutting emissions is turning off a tap. OER is about what you do with the water still flowing while your hand is on the valve.
Where do natural climate solutions fit?
Natural climate solutions do more than reduce or remove emissions. Well-designed projects – whether protecting forests, restoring ecosystems or improving land management – can deliver measurable climate benefits alongside outcomes for biodiversity, water security, local livelihoods and more resilient ecosystems. Climate and nature are deeply interconnected; the natural systems that regulate the climate are often the same ones that underpin supply chains and communities.
Importantly, SBTi’s definition of verified mitigation outcomes – the activities companies can use to address ongoing emissions – explicitly includes protecting, restoring and enhancing natural carbon sinks, alongside verified emissions reductions and removals. Project types such as REDD+ are therefore within scope, provided they meet the Standard’s integrity criteria (more on this below).
One important nuance is the distinction SBTi draws between long-lived and short-lived carbon removals. From 2035, the mandatory OER requirement for large companies places increasing emphasis on long-lived removals, recognising the importance of storing carbon for centuries or longer. Most nature-based removals are currently treated as short-lived because biological carbon stocks can be reversed through fire, disease or future land-use change.
However, the discussion is evolving. Increasingly, the question is not simply how long carbon is stored, but how reversal risk is managed. Mechanisms such as long-term stewardship, buffer pools, contractual commitments and financial instruments are all being explored as ways to strengthen the durability of nature-based removals. Recognising this, SBTi has committed to a future Call for Evidence to assess whether contractual or financial durability mechanisms could allow certain shorter-lived removals to meet future OER requirements. The post-2035 criteria are also explicitly scheduled for review before they come into force.
For businesses, the practical implication is that natural climate solutions have a much stronger role in Version 2 than they did previously. They are explicitly recognised within OER today, and while the long-term role of nature-based removals beyond 2035 is still being refined, the direction of travel is towards improving confidence in durability – not ruling nature out. In the meantime, companies should plan on the basis of a diversified portfolio of high-integrity mitigation outcomes while the evidence base continues to develop.
How can companies meet OER?
The Standard recognises that companies can contribute to climate mitigation in different ways. It introduces two pathways for addressing ongoing emissions: one centred on verified mitigation outcomes and another that supports broader climate action through a contribution budget.
The right approach will depend on a company’s strategy and objectives, but the principle is the same: companies should continue reducing emissions while also considering how they contribute to climate action beyond their value chain.
Do I need to switch to Version 2.0 right away?
Not immediately. Version 1.3.1 remains open for now, and existing near-term targets stay valid until the end of their timeframe. But from 1 February 2028, all new target submissions must align with Version 2.0 – worth planning for now if your next cycle lands anywhere near that date.
Does this change how we set Scope 3 targets?
Yes, in structure if not in spirit. Companies choose from an overarching absolute target, a supplier/customer alignment target, or category-specific targets – and can combine these. What’s new is the boundary: companies must now cover every Scope 3 category representing a meaningful share of emissions, not just the easy ones.
What counts as a “high-integrity” credit?
The Standard doesn’t endorse specific crediting programmes. Instead, it defines a set of minimum integrity criteria for verified mitigation outcomes, covering areas such as governance, robust quantification, additionality, reversal risk, third-party assurance and regulatory surplus. These criteria are designed to build on the significant progress already made across the wider carbon market ecosystem, rather than replace them. For natural climate solutions, that also means checking the project delivers for nature and local communities, not just a tonne count.
Should businesses wait for more clarity before acting?
No. Some open questions e.g. how legacy credit portfolios count toward OER, how validation bodies will assess “substantial progress,” the finer points of Scope 3 supplier accounting, don’t have public answers yet, and more guidance is coming. That’s a reason to start preparing, not to sit still: the companies best placed when guidance lands will be the ones who’ve already done the groundwork.
| Act now | Prepare now | Watch closely |
|---|---|---|
| Keep delivering on emissions reductions | Build internal understanding of what OER means for your business |
Future SBTi implementation guidance |
Brief leadership on where ongoing emissions sit in your climate strategy |
Map how procurement, finance, legal and sustainability would work together on this |
Emerging guidance on recognition and claims |
Talk to peers on what’s working |
Review governance and decision-making for credit use |
Continued market developments |
Looking ahead
For a lot of businesses, whether climate action is needed stopped being the question a while ago – that got settled when they set a science-based target. What’s open now is how to handle the emissions still in the system while that plan plays out, credibly and without getting ahead of the science.
NCSA will keep working through this with businesses, policymakers, and market experts as the guidance settles – through peer learning, practical guidance, and the unglamorous work of cross-sector coordination. The aim: help companies use high-integrity credits, especially from natural climate solutions, to back up real reductions rather than stand in for them.
Outline
