Why Scope 3 Emissions are Central to SBTi Delistings

The SBTi, a global framework pushing corporate climate action, delisted 239 companies in 2024, highlighting a gap between corporate promises and measurable action.

The list included prominent names like Microsoft, Unilever, Procter & Gamble and Walmart, all of which had previously committed to ambitious net zero goals under the initiative.

These removals were detailed in the SBTi’s final report for its Business Ambition for 1.5°C campaign, which underscores the challenges companies face in aligning their operations with science-based climate targets.

While losing their place on this list carries reputational risks, the SBTi has left the door open for these businesses to return if they submit revised and achievable targets.

David Kennedy, who became SBTi’s CEO in January 2025, emphasises the initiative’s critical role: “I admire the impact that SBTi has had catalysing action by thousands of companies around the world: it is an organisation that really matters.”

The decision sheds light on the increasingly urgent need for businesses to adopt effective sustainable procurement practices to address emissions across supply chains.

Scope 3 emissions: A major roadblock

The delistings were largely tied to missed deadlines for submitting validated emissions reduction targets.

Of the 1,045 businesses that joined the campaign between mid-2019 and late 2021, only 971 were included in the final report. Approximately 30% of these had their commitments rescinded, including 235 companies that had pledged to reach net zero by 2050.

One of the biggest hurdles for these businesses was tackling Scope 3 emissions.

Scope 3 refers to indirect emissions resulting from a company’s supply chain, product use and other external factors. These emissions often make up the largest portion of a business’s carbon footprint but are notoriously difficult to measure and reduce due to their complexity.

Lauren Foye, Head of Reports at Zero Carbon Academy, explains: “54% of surveyed companies reported that tackling Scope 3 emissions was too challenging. This complexity cannot be overstated.”

Technological uncertainty also added to the difficulties, with 53% of companies citing concerns over whether advancements in green technology would be sufficient to meet their goals.

Changes to standards, such as the Forest, Land and Agriculture (FLAG) criteria, introduced additional delays as organisations scrambled to adapt to new requirements.

Lauren adds: “A third of the companies pointed to the Net Zero Standard not being available at the time of their commitments.”

These issues highlight the importance of sustainable procurement in addressing Scope 3 emissions. By rethinking procurement strategies, companies can reduce emissions tied to their suppliers, materials and logistics.

Balancing resources and ambition

Limited resources further strained organisations as they attempted to meet their climate goals.

Businesses reported difficulties balancing staff shortages, competing priorities and the increasing demands of sustainability initiatives. Concerns over legal risks from failing to deliver on publicised climate commitments only heightened the pressure.

“These setbacks underline the importance of creating supportive frameworks to help corporations address barriers while ensuring accountability,” says Stacy Smedley, Executive Director at Building Transparency.

Despite being removed from SBTi’s net zero list, many companies reaffirm their sustainability ambitions.

For example, Unilever stated: “Unilever’s priority remains reducing emissions within the scope of our net-zero ambition, from 2039, with the same volume of carbon removals.”

Microsoft echoed this, stating: “SBTi’s removal of the net zero commitment from our profile in no way impacts Microsoft’s continued pursuit of our ambitious goals, which have not changed since we set them. Microsoft continues to work with SBTi and maintains a near-term SBTi-validated target that is aligned with the Paris Agreement.”

Even as some companies struggle to meet their commitments, others see an opportunity to redirect their efforts.

Joel Cesare, Head of Green Cities at BlocPower, views the situation optimistically: “Maybe the resources they were spending trying to comply with net zero administration can be directed towards action now. It could be a net win for the planet.”

Encouragingly, around 60% of delisted companies have maintained near-term emissions targets, signalling ongoing efforts to reduce their environmental impact. Sustainable procurement will play a critical role in these efforts, as companies must focus on reshaping their supply chains to lower their carbon footprints.

The SBTi’s actions remind businesses of the challenges in corporate decarbonisation, but also underscore the need for practical, well-supported strategies to help companies meet their commitments.

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