akar.earthSBTi FLAG Targets for Land-Intensive Companies
SBTi FLAG explained: who must set forest, land and agriculture targets, the no-deforestation commitment, removals rules and Indonesian supply chains.
SBTi FLAG is the Science Based Targets initiative’s guidance for forest, land and agriculture emissions: land-intensive companies must set separate targets for land-related emissions and removals, and commit to no deforestation. For Indonesian suppliers of palm oil, pulp, rubber, coffee and cocoa, FLAG explains why buyers are asking for farm-level data and value-chain removals.
What FLAG is
The SBTi published its Forest, Land and Agriculture (FLAG) guidance in 2022. It sits beside SBTi’s general corporate target-setting criteria and is designed for companies whose emissions come substantially from land use: deforestation and land conversion, agricultural production, and land management.
FLAG targets cover:
- Land-use change emissions, mainly from deforestation and conversion.
- Land management emissions, such as fertiliser, enteric methane and rice.
- Removals and storage on land within the company’s value chain.
SBTi revises its standards. A new version of the corporate net-zero standard has been in development, so check SBTi’s website for current FLAG criteria and how they interact with any updated standard.
Who must set FLAG targets
| Trigger | Examples |
|---|---|
| FLAG-designated sector | Food production, food and beverage processing, forest and paper products, tobacco |
| FLAG emissions of 20% or more of total | Retailers or manufacturers with large agricultural supply chains |
Companies that meet either trigger set a FLAG target alongside their energy and industry targets.
Key requirements
- No-deforestation commitment across primary deforestation-linked commodities, with a target date no later than 31 December 2025.
- Near-term FLAG target based on a sector pathway or commodity pathways.
- Long-term net-zero alignment, with deep cuts and neutralisation of residual emissions.
- Accounting consistent with GHG Protocol land sector guidance. See GHG Protocol land sector and removals.
- No carbon credits toward targets. Credits may be used beyond targets, for example under the VCMI Claims Code, but not to meet them.
Insetting and value-chain removals
Because credits do not count, companies look for reductions and removals inside their own supply chains, often called insetting. Examples relevant to Indonesia:
- Shade trees in coffee and cocoa agroforestry.
- Restoring riparian buffers and set-asides in palm landscapes.
- Rubber agroforestry instead of monoculture.
Value-chain removals need traceability to the company’s supply, monitoring of ongoing storage, and accounting for reversals. See carbon credits vs insetting and coffee agroforestry carbon.
How it applies in Indonesia and Southeast Asia
Indonesian exporters face FLAG pressure through their customers. A European chocolate maker or consumer goods company with a FLAG target needs supplier data on land-use change and farm practices. That overlaps with EUDR, which the European Commission says applies from 30 December 2026 and requires deforestation-free proof with a 31 December 2020 cut-off and plot geolocation.
The data needed for both is similar:
- Plot polygons and land-use history.
- Farm practice data such as fertiliser use.
- Tree measurements for removals in agroforestry.
Our guide to one dataset for carbon and EUDR explains how a single field campaign can serve FLAG, EUDR and carbon reporting. See also EUDR for coffee and EUDR for palm oil.
What Indonesian suppliers should prepare
Buyers with FLAG targets usually ask suppliers for:
- Plot or mill-level traceability, with polygons for production areas.
- Land-use change history back to the buyer’s assessment period, with evidence of no deforestation.
- Practice data, such as fertiliser rates, peat drainage and residue use.
- Removals data for trees on farms, with monitoring commitments.
- Annual updates, since FLAG accounting is not a one-time exercise.
Suppliers that can provide this data reduce their customers’ reporting risk and are more likely to win long-term contracts.
Collecting this data once and reusing it across customers is far cheaper than answering each request separately. A shared supplier dataset with polygons, land-use history and tree inventories can serve FLAG reporting, EUDR due diligence and, where projects exist, carbon crediting. Agree data ownership and consent terms with farmers and cooperatives before sharing data with buyers.
Common pitfalls
- Treating offsets as progress. Credits do not reduce FLAG emissions.
- Counting removals without monitoring. Value-chain removals need ongoing storage evidence.
- Ignoring land-use change history. Deforestation in the supply base in recent years drives emissions under FLAG accounting.
- Weak traceability. Removals on farms that do not supply the company cannot be counted.
Relationship to ICVCM CCP status
FLAG targets do not use credits, so CCP status is not part of FLAG compliance. It matters when a FLAG company buys credits beyond its targets: those credits should meet the CCP label for credible claims.
Next steps
Read the FLAG glossary entry, return to the standards hub, or talk to us about carbon strategy for supply-chain targets.
Frequently asked questions
What is SBTi FLAG?
SBTi FLAG is the Science Based Targets initiative's guidance for forest, land and agriculture emissions. It requires land-intensive companies to set separate science-based targets for land-related emissions and removals.
Which companies must set FLAG targets?
Companies in FLAG-designated sectors, such as food production and forest and paper products, and other companies whose FLAG emissions are 20% or more of total emissions. Check the current SBTi criteria for details.
Can carbon credits count toward a FLAG target?
No. Carbon credits bought from outside the value chain cannot count toward science-based targets. Removals within a company's own value chain, such as agroforestry on supplier farms, can count if they meet accounting rules.
What does FLAG require on deforestation?
FLAG requires companies to commit to no deforestation across their primary deforestation-linked commodities, with a target date no later than 31 December 2025.