SBTi Net-Zero Standard V2.0 (2026): What the New Science-Based Targets Rules Mean for Indian Companies

On 11 June 2026, the Science Based Targets initiative (SBTi) published the final Corporate Net-Zero Standard V2.0 — its most significant overhaul of corporate climate target-setting since the framework launched. With more than 10,000 companies worldwide already committed to science-based targets and thousands more preparing, V2.0 redefines what a credible net-zero pathway looks like.

For Indian companies juggling BRSR disclosure, EU CBAM exposure and the emerging Carbon Credit Trading Scheme (CCTS), V2.0 sets a clearer — and more demanding — global benchmark to align with. This guide breaks down what actually changed, the timeline you must plan around, and the practical steps to take in 2026.

What V2.0 actually changes

The headline shift is a move away from a one-size-fits-all model toward a framework that reflects different business contexts. The biggest changes are:

• Company categorisation: targets now scale with company size and the income level of the country a company operates in.

• Stronger focus on direct cuts: the standard prioritises real Scope 1, 2 and 3 reductions over offsetting.

• A formal role for removals: carbon removals move from optional to expected for the largest emitters over time.

• Recognition for high-integrity credits: a voluntary program recognises credits as a complement to — not a substitute for — decarbonisation.

• Tighter data and progress tracking: companies must show measurable progress, not just a distant pledge.

The new company categories — and why size and location matter

V2.0 splits companies into two groups. Category A covers large companies in all countries plus medium-sized companies in high-income countries. Category B covers small companies everywhere plus medium-sized companies in lower- and middle-income economies.

All companies must set near-term (5-year) targets for Scope 1 and Scope 2 emissions. Only Category A companies are required to set near-term Scope 3 targets — the indirect value-chain emissions that dominate most corporate footprints.

This matters in India. Many medium-sized Indian firms fall into Category B and gain phased flexibility, while large corporates and listed entities already filing BRSR will sit firmly in Category A, with the fuller set of obligations.

Scope 3, removals and carbon credits under V2.0

Scope 3 remains the centre of gravity — for most companies it is where 70-90% of emissions sit. V2.0 keeps the pressure on value-chain reductions while clarifying how credits and removals fit around them.

V2.0 treats high-integrity carbon credits as a complement to deep emissions cuts — never a substitute for them.

On removals, Category A companies will from 2035 be required to support carbon removals: covering 1% of ongoing Scope 1, 2 and 3 emissions in 2035, then rising in a straight line to neutralise 100% of residual emissions by their net-zero target year, and no later than 2050. Understanding the difference between removals and avoidance credits, and how to evaluate high-integrity credits before you buy, is now a strategic necessity rather than a nice-to-have.

The timeline Indian companies should plan around

• Through 2026: Version 1.3.1 remains the applicable framework for target validation.

• Q1 2027: V2.0 becomes effective; companies may submit under either V1.3.1 or V2.0 during the transition period.

• 1 February 2028: all new target submissions must align with V2.0.

In other words, companies ready to act in 2026 can still validate under the current rules, but every new target from early 2028 will be held to the V2.0 standard.

Why this matters more in India in 2026

V2.0 does not exist in isolation. It increasingly converges with the compliance pressures Indian companies already face. The India Carbon Credit Trading Scheme (CCTS) is building a domestic compliance market, while BRSR reporting requirements already push large listed companies to disclose emissions and transition plans. A validated science-based target gives all of these a credible, internationally recognised backbone — and signals to global buyers and investors that an Indian supplier is serious about decarbonisation.

How to prepare in 2026: a practical checklist

1. Build a complete GHG inventory. You cannot set a target without a baseline. Start with a net-zero baseline across Scope 1, 2 and 3.

2. Confirm your category. Determine whether you are Category A or B — it dictates your Scope 3 and removals obligations.

3. Decide on timing. If you are ready, validate near-term targets under V1.3.1 now; otherwise design directly to V2.0.

4. Map a Scope 3 roadmap. Engage suppliers, prioritise hotspots, and set measurable reduction levers.

5. Start a removals strategy early. High-integrity removal supply is limited and prices are rising — building relationships now de-risks 2035 obligations.

Where Csquare fits

Csquare helps Indian companies translate frameworks like the SBTi Net-Zero Standard V2.0 into an executable plan — from building a defensible GHG inventory and choosing the right target category, to designing Scope 3 reduction roadmaps and sourcing high-integrity carbon credits and removals. We connect your SBTi commitments with BRSR, CBAM and CCTS obligations so one strategy serves every stakeholder. Talk to the Csquare team to map your science-based target pathway for 2026 and beyond.