Land is where much of the climate challenge and opportunity sits. Forests, farms and soils absorb carbon but they also release it when converted, degraded or mismanaged. The Science Based Targets Initiative (SBTi) estimates that the forest, land and agriculture (FLAG) sector accounts for around 22% of global greenhouse gas (GHG) emissions, making it the third-highest-emitting sector after energy and industry. Practical upshot: for all organisations with land-intensive operations or supply chains, understanding FLAG targets is no longer optional.
Earlier this year the SBTi updated its FLAG Guidance. This article sets out what has changed and its effects.
What is a FLAG target, and who needs one?
FLAG targets sit alongside the corporate standard science-based targets (SBT). They cover emissions and removals from land use change, land management and forestry. They are required in addition because these elements behave very differently from fossil fuel emissions and therefore need their own accounting and target-setting approach.
If a business wants to set a formal SBT, it is required to set a FLAG target if it either:
- operates in a sector in which land-related emissions are typically material, such as forest and paper products (forestry, timber, pulp and paper); food production, including agriculture and/or products with an animal source; food and beverage processing; food and staples retailing; and tobacco; or
- has FLAG-related emissions that make up 20% or more of its total Scope 1, 2 and 3 footprint, regardless of sector.
This means the requirement is not limited to farmers and foresters. For example, retailers with significant agricultural supply chains or chemicals businesses sourcing biobased feedstocks can easily cross that 20% threshold once land-use change and agricultural emissions are properly quantified.
What’s changed in FLAG Guidance Version 1.2?
The update came through an SBTi “urgent revision” process, addressing two areas that could not wait for the normal five-year review cycle.
No-deforestation commitments: Companies must now set a zero-deforestation cut-off date no later than two years after submitting their targets, with a final deadline of 31 December 2030. This replaces the previous, more flexible, approach.
Alignment with the GHG Protocol: The revised guidance moves FLAG target-setting closer to the GHG Protocol’s Land Sector and Removals Standard, which becomes mandatory from 1 January 2027. Companies that have already set standard (i.e., non-FLAG) targets but are now also required to set a FLAG target will need to set these in addition to the non-FLAG targets.
As Karl Downey, the SBTi’s head of sector standards, put it when the update was published: “Land-sector climate action is critical to protect long-term business value and secure resilient and stable supplies of key agricultural commodities. In setting science-based targets in line with the new version of the FLAG Guidance, and defining appropriate decarbonization strategies to implement those targets, companies can help to not only stabilize the climate but preserve the land on which their businesses depend.”
For businesses already holding validated targets, the change is manageable as existing FLAG targets remain valid, and companies can choose to update their no-deforestation commitments voluntarily if they submitted before the new version came into effect. For anyone submitting or updating targets in 2026 or later, the Version 1.2 requirements apply now.
Does the SME route make this easier?
Under SBTi’s criteria, companies with fewer than 250 employees and under 10,000 tCO2e in combined Scope 1 and location-based Scope 2 emissions can generally use the streamlined small and medium-sized enterprise (SME) route. This route reduces the burden of Scope 3 quantification and shortens the validation process, making target-setting more achievable for organisations.
Larger multi-commodity businesses typically need to combine a sector-level approach with commodity-specific pathways for their highest impact products, which demands more granular supply chain mapping and a clear method for allocating land-related emissions across operations.
Is your business ready for the new land sector requirements?
Whether you’re a growing SME or an established multinational, the practical challenge is usually the same. Land-related emissions data is harder to source, more variable in quality and more exposed to supply chain uncertainty than energy or transport data. An accurate underlying GHG inventory and an understanding of where land-use change sits within it is the foundation for FLAG target-setting and for a defensible no-deforestation commitment.
Businesses that start this work now, rather than waiting for a validation deadline to force the issue, will have an easier path through target submission, plus a stronger story to tell stakeholders in the meantime.
How Nature Positive can help
Nature Positive supports businesses of all sizes through the full journey towards credible, science-based climate targets. Our team carries out GHG accounting and verification, helping you build a robust all-scopes GHG inventory that stands up to scrutiny and supports decarbonisation and target-setting aligned with SBTi criteria, including FLAG criteria.
If your business operates in a FLAG sector, or you’re unsure whether your land-related emissions have crossed the 20% threshold, get in touch with our team to discuss how we can help you prepare for the new requirements.