Science-based targets (SBTs) for food businesses involve requirements that don't apply to most other industries. The SBTi's FLAG guidance—covering Forest, Land, and Agriculture emissions—creates a distinct reporting and target-setting obligation for food companies, one that requires ingredient-level data and a separate reduction pathway from fossil fuel emissions.
This guide covers what SBTi requires from food businesses specifically, how FLAG changes the target-setting process, and what the data infrastructure for a credible SBTi submission looks like in practice.
What Science-Based Targets Are and Why Food Businesses Need Them
The Science Based Targets initiative (SBTi) is the leading framework for setting corporate emissions reduction targets aligned with the Paris Agreement. An SBTi-validated target gives stakeholders, investors, and procurement partners confidence that a company's climate commitments are grounded in what the science says is required—not just what is convenient or achievable without meaningful change.
For food businesses, SBTi targets are increasingly a commercial prerequisite as well as a climate commitment. Corporate procurement teams at large companies assess suppliers against SBTi status. CSRD transition plans are expected to align with science-based pathways. ESG-weighted tenders score climate commitments more credibly when they carry SBTi validation.
The SBTi currently validates targets for companies across all sectors. For food businesses—particularly those in food production, food retail, and food service—the FLAG guidance published in 2022 significantly changes what a complete SBTi target set looks like.
What FLAG Means for Food Businesses
FLAG stands for Forest, Land, and Agriculture. The SBTi FLAG guidance requires food companies to set separate reduction targets for land-use-linked emissions—deforestation, land conversion, and the agricultural production impact embedded in food supply chains—alongside a target for fossil fuel emissions.
The distinction matters because land-use emissions operate differently from fossil fuel emissions. Reducing land-use emissions requires sourcing shifts, supplier engagement, and supply chain traceability, not just energy efficiency or fuel switching. A food company that commits to renewable energy and fleet electrification while continuing to source from high-deforestation-risk origins is reducing a small fraction of its impact while leaving the majority unaddressed.
For a full methodology guide to FLAG emissions, see FLAG Emissions: A Complete Guide for Food Businesses.
Which Food Businesses Are Subject to FLAG?
FLAG applies to companies where land-use emissions represent a significant share of total Scope 1, 2, and 3 emissions. The SBTi's sector guidance identifies the following as subject to FLAG requirements: food and beverage companies, retailers with significant food categories, food service operators, and agricultural producers. For most food businesses with meaningful procurement of beef, dairy, soy, palm oil, or cocoa, FLAG emissions are material.
The Two-Target Structure for Food Businesses
A complete SBTi target set for a food business includes two separate pathways:
Target 1: FLAG Emissions Reduction Target
Covers the land-use change, deforestation, and agricultural production emissions embedded in the supply chain. For most food businesses, this is concentrated in Scope 3 Category 1, in the high-FLAG commodity categories.
The required reduction: under the default sector pathway for the food and agriculture sector, a 30.3% absolute reduction in FLAG emissions by 2030 from the baseline year. The exact rate depends on a company's chosen baseline year and target year. For the sector-specific benchmarks that inform what this reduction looks like in practice, see Food Emissions Benchmarks by Sector.
Target 2: Fossil Fuel Emissions Reduction Target
Scope 1 (direct combustion, refrigerant leaks), Scope 2 (purchased energy), and the non-FLAG portion of Scope 3. For food businesses, this is typically the smaller portion of total emissions—kitchen energy, logistics, packaging, and non-agricultural supply chain inputs.
The required reduction for the near-term target follows the 1.5°C-aligned pathway—typically a 42% reduction in absolute Scope 1 and 2 emissions by 2030, with Scope 3 fossil fuel targets dependent on sector-specific guidance.
Why the Separation Matters
Land-use emissions cannot be addressed through the same levers as fossil fuel emissions. They require:
• Originating ingredients from lower-deforestation-risk sources
• Engaging suppliers on farming system changes and land management practices
• Progressive substitution of high-FLAG ingredients with lower-FLAG alternatives
• Tracking origin-specific emission factors across reporting cycles
A company that meets its fossil fuel target through renewable energy while ignoring its FLAG emissions has not set a science-based target, but a partial one.
What Data a Food Business Needs for SBTi FLAG Target-Setting
The data requirements for SBTi FLAG target-setting are more demanding than for a standard Scope 1 and 2 target, because they require ingredient-level supply chain data.
A FLAG-Inclusive Scope 3 Category 1 Baseline
Setting a FLAG reduction target requires knowing what your FLAG emissions actually are—which means a Category 1 calculation that explicitly covers land-use change emissions for high-FLAG commodity categories. Standard spend-based Scope 3 tools typically omit or significantly underrepresent land-use change, producing a Category 1 figure that cannot be used as the basis for a FLAG target.
The baseline needs:
• Ingredient-level emission factors, not category-level averages
• Land-use change emissions explicitly included for beef, soy, palm oil, cocoa, and other high-FLAG ingredients
• Origin-specific factors where possible, to reflect actual sourcing rather than global averages
• Documentation of methodology, data sources, and any proxy assumptions
A Documented Baseline Year
The baseline year is the reference point against which future reductions are measured. It needs to be a recent year (typically within 5 years of target submission) with reliable data, and the methodology applied to it must be applied consistently in subsequent reporting years to make the comparison meaningful.
A Reduction Pathway
SBTi requires not just a target endpoint but a plausible pathway for reaching it. For FLAG emissions, that pathway typically involves:
• Identifying which ingredient categories drive the largest share of FLAG emissions
• Prioritizing procurement shifts and supplier engagement in those categories
• Setting interim milestones for primary data coverage improvements
• Connecting the reduction pathway to specific procurement and menu decisions
For a full guide to reduction levers for food businesses, see How Food Businesses Can Reduce Their Food Carbon Footprint.
Common Mistakes in SBTi FLAG Target-Setting for Food Businesses
Setting Targets Without FLAG-Inclusive Data
The most common error is submitting an SBTi target using a Scope 3 Category 1 baseline that excludes land-use change. The target may pass initial validation but creates restatement risk when methodology is reviewed under audit or when the company attempts to demonstrate progress.
Treating FLAG as a Footnote to the Fossil Fuel Target
FLAG and fossil fuel targets require different data, different reduction levers, and different supplier engagement strategies. Organizations that develop a strong fossil fuel reduction plan and then add a FLAG target as an afterthought typically struggle to demonstrate credible progress on the FLAG pathway.
Underestimating the Supply Chain Engagement Required
Unlike Scope 1 and 2 targets—where the company directly controls the relevant activities—FLAG reduction requires changing what happens in someone else's supply chain. That means supplier engagement, sourcing policy changes, and origin traceability, none of which can be accomplished quickly. The lead time for meaningful FLAG reductions is typically longer than for fossil fuel reductions, which makes early baseline data and early supplier engagement critical. For a practical guide to supplier engagement for FLAG-relevant commodities, see Scope 3 Supplier Engagement for Food Businesses.
Using Global Average Emission Factors for High-FLAG Commodities
A beef emission factor based on a global average understates the footprint for high-deforestation-risk origins and overstates it for low-risk origins. For a food business with significant beef procurement, using origin-specific factors is not just more accurate — it reveals where the reduction opportunity actually sits, which may point to specific sourcing changes rather than broad menu shifts.
How SBTi Connects to CSRD for Food Businesses
CSRD and SBTi are separate frameworks with different requirements, but they are increasingly aligned in what they demand from food businesses:
• Both require Scope 3 Category 1 disclosure with traceable methodology
• Both require FLAG-inclusive data for food companies with material agricultural supply chain exposure
• Both require year-on-year progress tracking against a documented baseline
• CSRD's transition plan requirement is most credibly fulfilled when it references an SBTi-validated pathway
For food businesses managing both obligations simultaneously, the most efficient approach is to build the data infrastructure once—ingredient-level, activity-based, FLAG-inclusive—and use it to serve both frameworks rather than running parallel methodologies.
For more on CSRD obligations for food businesses, see How Food Businesses Can Prepare for CSRD Reporting.
FAQ About SBTi and FLAG for Food Businesses
Q: What is the SBTi FLAG guidance and which food businesses does it apply to?
A: SBTi FLAG (Forest, Land, and Agriculture) guidance requires food companies to set separate science-based reduction targets for land-use emissions—including deforestation, land conversion, and agricultural production impact—alongside targets for fossil fuel emissions. It applies to food and beverage companies, food service operators, retailers with significant food categories, and agricultural producers where land-use emissions represent a material share of total impact.
Q: What reduction targets does SBTi FLAG require for food businesses?
A: Under the default sector pathway, a 30.3% absolute reduction in FLAG emissions by 2030 from the baseline year. Fossil fuel reduction targets follow the 1.5°C-aligned pathway—typically 42% absolute reduction in Scope 1 and 2 by 2030. The exact rates depend on the baseline year and target year selected.
Q: What data does a food business need to set an SBTi FLAG target?
A: A FLAG-inclusive Scope 3 Category 1 baseline: ingredient-level emission factors applied to actual purchase quantities, with land-use change explicitly included for high-FLAG commodities (beef, soy, palm oil, cocoa). Global average factors that exclude land-use change cannot serve as the basis for a FLAG target. The baseline needs to be documented clearly enough to be verified externally.
Q: What is the difference between FLAG emissions and Scope 3 emissions for food businesses?
A: Scope 3 Category 1 is the total greenhouse gas footprint of purchased goods—including both FLAG (land-use, agricultural) and non-FLAG (processing, transport, packaging) emissions. FLAG emissions are a subset of Category 1, specifically the land-use and agricultural production component. SBTi requires these to be separated and targeted distinctly because they require different reduction levers.
Q: How does SBTi target-setting connect to CSRD reporting?
A: Both frameworks require Scope 3 Category 1 disclosure with traceable methodology, FLAG-inclusive data for food companies, and year-on-year progress tracking. CSRD's transition plan requirement is most credibly supported by a validated SBTi target. Building the data infrastructure to serve both simultaneously—ingredient-level, activity-based, FLAG-inclusive—is more efficient than developing parallel methodologies.
Q: How does Klimato support SBTi FLAG target-setting for food businesses?
A: Klimato Food Emissions produces FLAG-inclusive Scope 3 Category 1 data—separating land-use and agricultural production emissions from fossil fuel emissions—aligned with the GHG Protocol and SBTi FLAG methodology. Outputs provide the ingredient-level baseline data needed for FLAG target-setting and the year-on-year tracking required to demonstrate progress.
Gioia Zagni
Chief Science Officer, Klimato
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