What is the SBTi’s FLAG guidance?
Launched in 2022, the Science Based Targets initiative’s (SBTi) Forest, Land and Agriculture (FLAG) Target-Setting Guidance was the organisation's first sector-specific methodology for businesses. FLAG guidance enables companies to set targets focused on their key impact areas, developing specific decarbonisation strategies that are more likely to succeed.
FLAG emissions
With roughly a quarter of global greenhouse gas (GHG) emissions coming from FLAG sources, it is crucial that decarbonisation guidance reflects the unique challenges and opportunities within the sector.
Decarbonisation of the FLAG sector is likely to be more challenging than reducing emissions from energy and industry, largely due to:
- The complex, biological nature of agricultural practices, which are more difficult to control (for example, methane emissions from livestock are a natural byproduct of digestion and cannot be eliminated)
- Longer technological development cycles
- The prevalence of highly potent GHGs, such as methane and nitrous oxide
FLAG activities have unique potential to expand and consolidate natural carbon sinks, which is crucially important for meeting global climate goals. The land sector could contribute roughly 30% of the global mitigation required by 2050 to meet the 1.5oC target of the Paris Agreement.
Who is impacted by FLAG?
Many businesses are required to set FLAG targets depending on their sector or emissions profile across scope 1, scope 2, and scope 3. However, some businesses outside of these sectors, like apparel, mining, and publishing, may also be required to set targets because 20% of their value chain emissions are in the FLAG sector.
GHG accounting and FLAG targets
Companies impacted by FLAG who wish to set science-based targets (SBTs) are required to measure a full GHG inventory (scope 1, scope 2, and all material scope 3 categories) in accordance with the GHG Protocol Land Sector and Removals Guidance as well as submit FLAG targets to the SBTi for validation.
To measure an SBT-aligned GHG inventory, a company must measure and account for emissions associated with land-use change, land management, and carbon removals. These then need to be reported separately within the GHG inventory before developing and submitting FLAG targets alongside targets for non-FLAG emissions.
Two different target-setting pathways are available for companies submitting FLAG targets to the SBTi.
Supply-side companies
Supply-side companies with agricultural sites and FLAG emissions within scope 1 and scope 2 can use commodity pathways with unique decarbonisation intensity rates for 11 different commodities: beef, chicken, dairy, leather, maize, palm oil, pork, rice, soy, wheat, timber and wood fibre. They may also set an absolute reduction FLAG sector target.
Demand-side companies
Demand-side companies, which rely on FLAG products but do not produce the raw materials themselves, should set a FLAG sector target with an absolute reduction rate applied to all FLAG emissions.
Timelines for FLAG targets
Timeline requirements for FLAG targets are dependent on any existing SBTs that a company has validated: starting April 2023, any company who sets targets or updates their existing targets (including when adding a net zero target) must set FLAG targets if eligible. Businesses with an SBT set after January 2020 but before April 2023 need to update their targets to include FLAG before the end of 2024.
The SBTi’s FLAG guidance allows businesses to set targets and decarbonise in a way that acknowledges the distinct challenges and opportunities within the sector. The first step is to measure their company carbon footprint in accordance with the GHG Land Sector and Removals Guidance. For businesses with this in place, the priority is developing FLAG targets in preparation for an SBTi submission.
Learn more about science-based targets and measuring your company carbon footprint with ClimatePartner Academy.