SBTi FLAG

Everything food companies need to know to set FLAG Science-Based Targets

WEBINAR

Getting ready for SBTi FLAG:
How food companies can meet carbon reduction goals

Companies that have, or plan to set science-based targets will be required to set a FLAG target, pending the release of the GHG Protocol’s LSR Guidance in 2024.

Designed for food and beverage companies, this webinar will dive into how FLAG Guidance affects companies with land-sector emissions in their supply chain, and what to do about it.

What is FLAG Guidance?

FLAG Guidance is a set of guidelines established by the Science Based Targets initiative (SBTi), allowing companies in land-intensive industries (Forest, Land, and Agriculture) to set near and long-term, science-based targets to reduce their GHG emissions.

FLAG Guidance applies to any companies over 500 employees in land-intensive industries that have set or plan to set Science-Based Targets. In short, FLAG enables these companies to design a more efficient strategy for reaching carbon reduction goals by separating out their land-based emissions and reductions as well as carbon removals in their measurement, target-setting and reporting processes.

Land-related emissions account for 22% of global emissions, but the land sector in general has the potential to deliver 30% of climate mitigation by 2050. Given the opportunity for the land sector to use nature-based solutions to remove and store carbon, FLAG will play a critical role in enabling companies to measure and improve their emissions, and strategize for removals most effectively.

Who will need to follow FLAG guidance?

FLAG applies to companies setting SBTi targets under these 2 scenarios:

When will FLAG Guidance go into effect?

FLAG Guidance is already in effect, as of September 2022.

If you are a company with an existing SBTi target and fall within the requirements to set a FLAG target, you must add a FLAG target within 6 months of the release of finalized GHG Protocol Land Sector and Removals (LSR) Guidance.

If you do not have any validated SBTi targets, but plan to set a target within the SBTi framework (and still fall within the requirements of FLAG), you must submit all targets at the same time.

Note on LSR Guidance Timeline: The GHG Protocol Land Sector and Removals Guidance (LSR) is currently under final review, but a draft version has been released. SBTi is allowing companies who have already submitted and validated an overall target to set their FLAG-specific target 6 months after the final release of LSR guidance. After April 30, 2023, any company looking to submit an overall SBTi target must also set a separate FLAG target. The Science Based Targets initiative recommends using the draft version of GHG Protocol LSR guidance for this purpose.

Discover the only end-to-end FLAG emissions reduction tool built specifically for the food industry to design your emissions reduction strategy.

How to set a FLAG target

There are 2 approaches to setting a FLAG target:

Companies may use a combination of commodity pathways and the sector pathway to achieve their overall target-setting.

FLAG emissions and removals categories

The following categories must be measured and broken out for FLAG target setting:

Land Management: any activity occurring on the field where a commodity is grown
Land Use Change: any land conversion that has occurred in the last 20 years
Carbon Removals: any carbon that has been removed from the atmosphere due to on-farm activity

Land Management

Land Use Change

Carbon Removals

FLAG target requirements

The FLAG tool will determine a company’s reduction target for them based on the company’s base year, target year, and baseline emissions. The following key requirements are directed by SBTi FLAG.

Set near-term FLAG science-based targets

5-10 year emission reduction targets in line with limiting warming to 1.5°C

Account for removals in near-term FLAG science-based targets

Including improving forest management practices, and enhancing soil carbon sequestration on working lands

Set long-term FLAG science-based targets

Companies in FLAG sectors will reduce at least 72% of emissions by no later than 2050

Zero deforestation targets must be set for no later than 2025

In line with the Accountability Framework initiative (AFI)

Set science-based targest for fossil emissions

Businesses with land-based emissions are required to set FLAG science-based targets AND science-based targets, since all companies product fossil emissions

The FLAG tool will determine a company’s reduction target for them based on the company’s base year, target year, and baseline emissions.

Data requirements for FLAG target setting

SBTi has specified they are looking for completeness of data and accuracy in the development of FLAG targets. Companies are required to provide sufficient insight into the level of data granularity they are utilizing for their approach. For companies with complex supply chains in particular, utilizing emissions databases is likely necessary for creating a full GHG inventory.

Does your carbon footprinting utilize granular emission factors for every ingredient in your portfolio? Get access to the largest product sustainability database, with crop- and location-based emission factors for 33,000 food ingredients.

SBTi FLAG Guidance vs. GHG Protocol LSR Guidance

The GHG Protocol Land Sector and Removals Guidance provides a framework for measuring and accounting for land-related greenhouse gas emissions, but does not provide direction on setting reduction targets.

The Science Based Targets initiative (SBTi) provides a framework for setting these targets, and FLAG (under SBTi) specifically is a set of guidelines for land-intensive sectors, which historically have been difficult to evaluate, in terms of target-setting and GHG measurement.

Land Sector and Removals (LSR) Guidance

Expected Release: 2024

Forest, Land and Agriculture (FLAG) Guidance

Released September 2022

MEASUREMENT & ACCOUNTING

TARGET SETTING

REPORTING

EMISSIONS REDUCTION

Reporting Company

Frequently Asked Questions about FLAG Guidance

What does FLAG stand for?

Forestry, Land, and Agriculture. This sector describes companies with land-intensive activities that involve agriculture, forestry, or other land use.

What are FLAG targets?

Guidelines, including a target-setting tool, from the SBTi for companies in land-intensive sectors to set near-term emission targets aligned with the Paris Agreement.

Who is required to set a FLAG target?

Companies with land-intensive activities in their value chain that have set or plan to set Science-Based Targets are required to set FLAG targets.

What are the deadlines for setting FLAG targets?

Any company meeting the criteria must set a FLAG target if submitting an SBTi target for the first time. For companies with existing SBTi targets (prior to April 30th, 2023) the deadline is 6 months after the finalization of GHG Protocol Land Sector and Removals (LSR) guidance (Expected mid-2024).

Can carbon credits be used to meet FLAG targets?

Carbon credits issued outside of a company’s chain cannot contribute towards meeting FLAG targets, only emission reductions and removals inside of a company’s supply chain can contribute towards meeting a FLAG target, often referred to as “insets.”

What needs to be included in a FLAG target?

Any activities associated with Land Management and Land Use Change must be included in a FLAG target. Carbon Removals are also required and must be broken out separately.

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