Acronyms have a habit of draining the life out of compelling concepts. And they're doing exactly that to one of the most radical developments in corporate climate action since the Paris Agreement.
The Science Based Targets initiative's sweeping 2.0 update to its Corporate Net Zero Standard introduces something called Ongoing Emissions Responsibility, or OER (formerly known, even less memorably, as BVCM). Buried under the jargon is an idea that should make sustainability teams and leaders sit up: permission to innovate, to personalise, to create value.
In the rigid, gridbound world of target-setting and carbon accounting, OER is a genuine liberation. SBTi has formalised and created vital permission for innovation as you deliver Net Zero. Be imaginative about what impact really means. Choose your own path to deliver it. And take real, accountable responsibility for getting there. Then get public recognition for that commitment from the world's leading corporate climate framework.
You may think that recognition matters most; I argue it matters least. The recognition provides a framework and a benchmark – and actually I suspect the requirement to publicly opt out will shift more behaviours – but the work – the impact – will be far more meaningful for business and brands in this liberated new world.
My colleague, the superb Robert Cheesewright, co-wrote the Gold Standard report on how to implement OER, and there's much more detail in its 40 pages. But here's the shape of it, in brief.
A company sets a net zero target under the SBTi framework, built around cutting emissions – both direct and across the value chain – as the primary route to get there.
It measures its "ongoing emissions": the ones it's working to eliminate by its net zero year, but can't yet.
It then voluntarily takes responsibility for those emissions, by deciding what percentage it wants to address and setting an internal carbon price – say, $20 or $80 a tonne. That seeds a fund. And that fund can support a genuinely wide range of environmental, social and policy action.
Companies are recognised at three tiers, based on how much of their ongoing emissions they address and the price they put on carbon. "Leadership" sits at the top: 100% of ongoing emissions, at a high carbon price. "Advanced" is the credible middle ground. "Engaged" is where many companies will start. My money is on "advanced" as the option most likely to be chosen by businesses who genuinely understand climate and value of brand.
What makes OER radical is its flexibility. It recognises something obvious but often ignored: there are thousands of ways to address emissions and their impact on the world, and some will simply fit a company better than others. OER lets businesses choose what's true to them – with the same mix of passion and rigour you'd want from a good corporate brand strategy. Choices made this way are more likely to last a decade, precisely because someone chose them on purpose.
Crucially, OER breaks with the narrow, faintly misleading logic of offsetting – that the only way to deal with a tonne of emissions is to pay for a tonne removed elsewhere. One out, one in. It's a tidy idea. But the Earth isn't a spreadsheet, and it never balances quite that neatly.
Like the Climate Contribution Framework it's built on, OER still demands proper accounting and real accountability. But it frees up the corporate imagination to consider a world of solutions to a world-sized problem. Carbon credits are one option among many – alongside environmental action, policy advocacy, research and development, and adaptation.
Take a bicycle manufacturer in a mountain town. Under OER, it might set up a fund – seeded by its internal carbon price – to take responsibility for perhaps 10% of its ongoing emissions while it works to reduce them to zero. That fund could back a genuine portfolio:
Protecting a nearby river, and the ecosystem around it
Funding research into carbon-negative metals for future bikes – work that also helps hit its 2050 SBTi target
Backing a local climate fund
Supporting a policy group pushing for low-emission transport in national budgets
And yes – buying carbon credits from forestry projects, tonne for tonne, alongside all of the above
Early reactions to SBTi 2.0 focused almost entirely on carbon credits. Sceptics asked why credits – forbidden within SBTi for years – are now allowed in through OER's side door. That misses the point. Carbon credits are one route within an OER strategy, not the strategy itself. Advocates on the other side argued removals deserve a bigger role before 2035, not just a voluntary nod for the next decade. That misses something too: SBTi is entirely voluntary, start to finish. If a company signs up voluntarily, shouldn't it have real choice in how it gets there?
Within that voluntary framework, OER frees companies to think bigger, and to think like themselves.
I'll be writing more on OER through the year, because I think it's going to shape how Pinwheel's clients build their SBTi-linked climate strategies for years to come. For now, a few things stand out to me:
Having a framework is value in itself. Boards trust structure. OER gives sustainability teams a blueprint that's backed by SBTi's authority and comes with public recognition attached – which makes it a far easier conversation to have upstairs.
The rules are set. The implementation isn't – so move now. The fine detail of OER is still being worked out, but its role within CNZS 2.0 is settled, and it's here to stay. The companies that move first won't just earn a badge. They'll help shape what best practice looks like, for everyone who follows.
"Advanced" is the new gold standard for most companies. Taking responsibility for 10% of total emissions at an internal price of $20 a tonne – roughly a quarter of the EU ETS price – is ambitious, but genuinely achievable. "Leadership" is further out, a goal for the late 2030s rather than tomorrow, but it's real.
Think like a portfolio manager, not a compliance officer. OER is nudging sustainability and finance leaders toward a different mindset. Less "have we ticked the box," more "have we built a portfolio that actually delivers, and gets us properly recognised for it."
The more I dig into the detail, the more I like this. SBTi has found something rare: clear rules of engagement, paired with real room for judgement and creativity in how companies show up. We're already working with clients on their OER strategies – and honestly, it's a good feeling to be strategising with vision and imagination, rather than just accounting for it.
