While underperforming companies should not be able to claim they have met their interim targets, there should be mechanisms that will enable them to stay in conformance with the standard through measures to address underperformance. The NCSA supports the use of a Linear Contraction Approach but calls for allowing also the use of reductions beyond the value chain, and not only removals. The timely delivery of climate benefits of actions that “replace” the internal mitigation measures must be prioritized; relying only on removals here could create a supply shortage of immediately available removals. Including also the possibility of using reductions beyond the value chain (including reduction carbon credits), will guarantee higher flexibility that make the standard more accessible without compromising integrity, encouraging more companies to sign up and take demonstrable climate action. High-integrity reduction and removal carbon credits will support the effective and efficient implementation of this requirement.

This requirement should not only apply to Scope 1 emissions but also to Scope 2 and 3.

To drive meaningful transformation in the Forest, Land, and Agriculture (FLAG) sector, indirect mitigation must explicitly include landscape-level actions that are critical for systemic change. Many of the most impactful interventions—such as protecting forests near sourcing regions, restoring degraded lands within watersheds, or enabling regenerative practices across entire farms—occur beyond the GHG accounting boundaries for agricultural supply chains. These actions often fall outside current GHG accounting boundaries, yet they are deeply connected to a company’s value chain both ecologically and socio-economically. Recognizing them as valid forms of indirect mitigation would unlock investment in collaborative, high-impact projects that reduce emissions, enhance biodiversity, and build resilience across entire sourcing landscapes. 

The SBTi has an opportunity to lead by defining and incentivizing a robust category of indirect mitigation that captures these landscape-scale outcomes. As the report highlights, current frameworks disincentivize companies from investing in shared landscapes due to unclear boundaries and limited claim opportunities. By allowing a portion of Scope 3 targets to be met through verified landscape-level interventions – especially those that deliver co-benefits for nature and people – SBTi can catalyze collective action, reduce free-rider risks, and support the transition to sustainable land use systems. This approach would align climate ambition with the realities of agricultural supply chains and accelerate the sector-wide transformation needed to meet global climate and nature goals. 

The specific GHG accounting boundaries limiting action are traceability, proximity, allocation, and attribution and are discussed in much more detail in a recent report endorsed by 25 organizations.

Allowing indirect mitigation as a temporary measure will certainly help meet Scope 3 targets when direct mitigation isn’t immediately feasible. Market mechanisms or credits “relevant” to the emissions source/geography should be strongly encouraged. These mitigation activities support absolute emission reductions in hard to abate sectors (including agriculture), driving transformation relevant to a company’s value chain, and are appropriate as a time-limited indirect mitigation measure. For instance, given the significant challenges in tracing Scope 3 Forest, Land, and Agriculture (FLAG) sector emissions in developing countries and the landscape level action required to combat deforestation, investment in jurisdictional or project-based REDD+ credits from the same sourcing landscapes should be counted as indirect mitigation to offer immediate, high-integrity, relevant mitigation for land use change and other related FLAG emissions. (J)REDD+ efforts support government-led and/or landscape-based programs which drive the systemic change required to combat deforestation. As with other forms of indirect mitigation, use of credits for this purpose can be time-limited and include appropriate guardrails to ensure additional impact. 

To maintain transparency, SBTi should clarify how companies report and account for indirect mitigation—potentially using dual ledger reporting to reflect both inventory emissions and mitigation investments. Importantly, indirect mitigation must never undermine or postpone direct decarbonization, particularly in sectors like agriculture where systemic change is complex but essential. Clear phase-out dates will encourage long-term decarbonization while ensuring credits from long-term agreements are fully recognized.

Science is clear: we must rapidly pursue decarbonization today, and we cannot afford to wait for 2050 to begin neutralizing emissions. For carbon removal technologies to be cost effective and available at scale in 2050, a clear and growing demand signal is needed. Companies must be incentivized to begin to purchase and retire carbon removal credits today to begin to neutralize their emissions. Companies should be scaling up their annual removals purchased and retired each year, so that they are able to neutralize 100% of residual emissions annually at the point of net zero.

Near-term removal targets are critical for spurring the necessary investment in carbon removals today and for avoiding overshoot of 1.5 degrees C. Allowing the use of nature-based removals will mitigate the risks that removal targets become a barrier to deliver science-based targets. This will require a stronger endorsement of nature-based removals with minor changes to the gradual transition approach: as we transition to greater proportion of novel-CDR, SBTi should consider allowing for companies to use up to 100% nature-based removals through 2030, with a slower ratcheting up to novel-CDR by 2050.

Instead of imposing a permanence threshold, SBTi should differentiate between conventional and novel CDR, gradually increasing novel CDR share over time. The standard should align with ICVCM’s Core Carbon Principles, manage reversal risk through buffer pools or insurance, and simplify the gradual transition method to improve clarity and stakeholder buy-in.

Furthermore, this requirement should apply to all companies. While it’s clear that companies face different challenges based on their size and location, the ability to gradually neutralize residual emissions on the pathway to net zero is not complicated. As long as the SBTi’s standard allows for nature-based removals to count for neutralization, companies should have adequate options for performing against this requirement.

This requirement should apply to both Scope 1 and  2 emissions; recognition should be available for setting removal targets to address Scope 3 related residual emissions.

As addressing ongoing emissions is going to be a critical part of the net-zero transition, reporting on action to address ongoing emissions should be a requirement: all companies with SBTi targets should also be required to report to SBTi on how they address ongoing emissions and have their action (or non-action) to address the ongoing emissions publicly shared out via the SBTi dashboard. Such increased transparency would be a “carrot” for those companies who try to go above and beyond, as well as a “stick” for those taking no voluntary action to address ongoing emissions, while not going so far as to require it.

The opt-in solution, as currently proposed, combined with a “contribution” claim, will not be sufficient incentive for companies to act beyond their internal decarbonization.

Companies, however, should not be required to cover 100% of all emissions scopes for recognition. While this would be a great goal to strive for, this would be unrealistic for almost all companies and would limit participation in carbon markets to a select few sectors with high profit margins and low emissions. However, companies should be encouraged to cover as great a percentage of all scopes as they are able, with 100% coverage particularly well recognized. Nonetheless, any investment in addressing ongoing emissions should be considered above and beyond and should be recognized. The portion of residual emissions addressed by retiring removals should be recognized as part of this “coverage of emissions”.

All mitigation actions taken to address the on-going emissions should be verified by a third-party regardless of the type of investment, and possibly all should be creditized.

The type of claim that companies addressing their on-going emissions will be allowed to make will make a big difference. Generally, a “contribution” claim that does not link emissions to mitigation measures will be much less effective than a “compensation” claim that links the on-going emissions with the mitigation actions taken beyond the value chain.

To create an incentive for companies to address ongoing emissions through beyond value chain mitigation action, such as the use of high-integrity carbon credits, the claim must be significantly stronger than a philanthropic “contribution,” something that is more on par with “compensation.

While in the future, we believe it may be appropriate for SBTi to reference and align with Integrity Council for the Voluntary Carbon Market (ICVCM) and its Core Carbon Principles, Article 6.4 credits, and credits certified under the EU CRCF (Carbon Removals & Carbon Farming Regulation) as the reference standards for defining high integrity carbon credits, it is too early to point to only these standards at this time.

As ICVCM is still working to roll out its CCPs and there are too few CCP-labeled carbon credits issued today (and no removal credits). Article 6.4 and EU CRCF, which will also be good standards to reference in the future, are also still working to roll out their methodologies, SBTi should consider an interim phase-in, similar to the one VCMI recently codified for their programme. VCMI will allow CORSIA-eligible credits and allow other credits where a company discloses how existing due diligence processes align with ICVCM’s CCPs. SBTi could also consider recognizing (beyond an interim transition period) existing multi-year carbon credit procurement agreements that were established prior to CCP-labelled or Article 6.4 credits becoming available in the market.