In March, a lot of finance teams crossed CSRD off the risk register. The Omnibus raised the threshold to more than 1,000 employees and more than €450m turnover, both tests together, and most mid-sized companies fell out of scope along with the assurance obligation that came with it.
Some of those companies also hold a science-based target, and the SBTi has just rewritten its rules. Version 2.0 of the Corporate Net-Zero Standard makes independent assurance mandatory for its larger category of company, and its definition of “larger” is far wider than the one in CSRD. This is assurance arriving through a voluntary commitment. Nobody owns it, so nobody budgets for it.
The dates
The SBTi published Corporate Net-Zero Standard V2.0 on 11 June 2026. According to the SBTi’s own Main Changes Document, it takes effect on 31 January 2027, followed by a transition period running from Q1 2027 to Q1 2028:
- From Q1 2027, target validation under V2.0 is available.
- Until 31 January 2028, companies can still submit targets under V1.3.1 (and the Near-Term Criteria V5.3).
- From 1 February 2028, every new target submission must align with V2.0.
Companies that already hold 2030 targets are told to start setting their next cycle (2030 to 2035) under V2.0 from 2028. So the question is when you next submit, and for many companies that is sooner than the 2030 date on the current target suggests.
Category A: why “we are too small” may not hold
V2.0 drops the separate SME route and sorts every company into one of two categories. Category A carries the full set of obligations. You are Category A if you meet either of these tests:
- Any country: net turnover of €450m or more, or 1,000 or more full-time equivalents.
- High-income countries (using the World Bank classification, which includes the UK): Scope 1 and 2 emissions of 10,000 tCO2e or more, or at least two of a €25m balance sheet, €50m turnover and 250 FTEs.
Everyone else is Category B. Three details matter for finance. Thresholds are assessed on consolidated group figures, even if your target boundary sits lower in the group. They use the average of your two most recent financial statements. Geography follows the country where the ultimate parent is incorporated.
Compare that with CSRD. CSRD now needs 1,000 employees and €450m. Category A needs only one of them, and in a high-income country a 300-person business with €60m turnover and a €30m balance sheet qualifies. Plenty of companies that fell out of CSRD scope in March are squarely Category A.
What Category A has to do
Assurance, at three points in the cycle
Criterion CNZS-C7 requires independent third-party assurance of the target base year inventory, at a minimum of limited assurance, covering Scope 1, Scope 2 and Scope 3, low-carbon electricity calculations, significant emissions-intensive activities and any other metric used to set targets. The provider must be an accredited independent third party working to internationally recognised assurance standards. The SBTi says it will set out which frameworks it recognises; in practice many providers will run these engagements under ISSA 5000, the new global assurance standard.
Any base year recalculation must also be assured (C8.6), as must the data behind your end-of-cycle progress assessment (C37.7). The level of assurance is shown publicly on the SBTi Dashboard.
A published transition plan
All companies need a transition plan approved by the board. Category A companies must publish it within 15 months of target validation.
Scope 3 targets, on a new boundary
Near-term Scope 3 targets are required for Category A and optional for Category B. The old two-thirds coverage rule is replaced by a significance test: targets must cover every Scope 3 category representing 5% or more of categories 1 to 14 emissions, with limited named exclusions that must be reported and justified.
The other changes worth knowing
- Separate Scope 1 and Scope 2 targets replace the combined Scope 1 and 2 target. Scope 2 emissions targets are based on the location-based inventory, with market instruments dealt with separately under a new implementation hierarchy.
- A target base year built on your latest comprehensive data replaces the historical base year. You can still communicate progress against an earlier year if equivalence is validated.
- Carbon removals get detailed neutralisation rules on storage durability and double counting, plus a requirement for Category A companies to support removals from 2035.
One point is widely misunderstood, so it is worth stating plainly: carbon credits still cannot be counted toward your Scope 1, 2 or 3 targets. V2.0 creates a voluntary Ongoing Emissions Responsibility recognition programme for credits and other climate contributions, and the standard says outcomes claimed there cannot be counted toward target implementation or netted from the inventory. Credits sit alongside reductions. They never replace them.
From “does not apply” to an unbudgeted fee
A typical case looks like this. The sustainability team set a near-term target in 2022 or 2023. The company is 600 people with €120m turnover, so finance correctly concluded in March that CSRD no longer applies. The next SBTi submission falls in 2028, under V2.0, as Category A.
Because V2.0 uses your most recent comprehensive data as the base year, a 2028 submission will most likely rest on FY2027 figures. Those figures need limited assurance across all three scopes before validation. FY2027 starts in about three months for a calendar-year company, and the assurance fee and internal time are probably in nobody’s plan.
Scope 3 is the expensive part. Limited assurance of supplier-derived data, spend-based estimates and emission factor choices tests the documentation behind every number. The practitioner checks that methods are recorded and reproducible and that estimates are labelled. Our post on the six tests an assurance provider actually runs sets out what that looks like in practice.
What to have in place a year ahead
- Run the category test now on consolidated, two-year-average figures, and record the result with the workings.
- Find out when you next submit. Check the SBTi Dashboard and your commitment letter. If it is 2028 or later, plan on V2.0.
- Treat FY2027 as a probable base year. Fix the boundary and factor sets for the year and attach evidence as data is entered.
- Re-map Scope 3 against the 5% test and identify which categories will need targets and which exclusions you would have to justify.
- Talk to an assurance provider this autumn about scope, level and the disclosures they see as high risk.
- Put the fee and internal time in the FY2027 budget. Where lineage is visible, the practitioner spends less time reconstructing evidence and the fee reflects it.
- Get the transition plan onto the board agenda, since it needs board approval and, for Category A, publication within 15 months of validation.
For context on what validation requires under today’s rules, see what SBTi validation actually requires.
One last point. The SBTi inventory, the numbers in customer questionnaires and any figures in the annual report should come from the same evidenced dataset. When they come from three spreadsheets, the assurance provider will find the gaps before you do.
Horizon ESG holds datapoint-level lineage, factor source and version on every calculation, labelled estimates, an immutable change log and enforced separation between preparer and approver, the controls a limited assurance engagement on a base year inventory will test. Horizon ESG for finance teams sets out how that works for a controller or CFO. If an SBTi submission is on your horizon, book a short demo and ask us to trace a Scope 3 figure back to its source, live.
Sources: SBTi Corporate Net-Zero Standard V2.0 (June 2026) and Main Changes Document (11 June 2026); SBTi Corporate Net-Zero Standard page, checked 22 September 2026.
Leave a Reply