Forest, Land and Agriculture (FLAG) Science-based Target Guidance

• Direct land use change associated with deforestation and forest degradation
• Indirect land use change associated with deforestation and forest degradation

• CH4 & N2O from manure management
• N2O from fertiliser
• N2O from crop residue
• CO2 from machinery use on farm
• CO2 from fertiliser production
• CH4 enteric emissions (Meat-Beef, Dairy)
• CH4 and N2O emissions from agricultural waste burning
• CH4 emissions from flooded soil (for lowland rice only)

• Forest management
• Afforestation and reforestation
• Agroforestry
• Soil sequestration carbon
• Biochar

Communicate the new FLAG guidance to your key stakeholders and the impact of FLAG on GHG accounting and future SBTi reporting

• Review your key operational activities around forestry, land and agriculture 
• Conduct a strategic review of the organisations current SBT activity

• Review current GHG inventory analysis for your entire product portfolio 
• Complete inventory screening to identify and map your FLAG emissions and removals to determine whether FLAG is relevant to your organisation

• Use the Anthesis ‘FLAG Inventory Tool’ to separately calculate fossil GHG emissions, biogenic GHG emissions and biogenic GHG removals 
• Create a framework allowing you to continue accounting for FLAG and non-FLAG emissions separately

Provide data collection guidance and a template for future use of the FLAG inventory tool

Use interactive dashboards, or your reporting structure to monitor future data inputs identifying hotspots 

• Review reduction strategies toward targets, including: 
• Agroforestry/Regen-Ag strategies  
• Renewable energy projects 
• Infrastructure improvements 
• Internal carbon pricing 

• Identify FLAG emissions in priority supply chains
• Engage your supply chain to establish further KPI’s and targets
• Review and implement potential strategies surrounding Incentivising/rewarding reductions of FLAG emission hotspot areas in supply chains against KPI data

Do organisations need to set a FLAG and a non-FLAG target?

FLAG targets are separate from other fossil/industrial or non-FLAG targets. FLAG SBTs only apply to an organisation’s GHG emissions from AFOLU emissions (Agriculture, Forestry and Other Land Use). Therefore, relevant organisations will have separate FLAG and Non-FLAG targets.

Does the FLAG guidance require both a short-term and long-term target?

Similar to energy/industry targets, FLAG targets may include both a near-term target covering a period of 5-10 years and a long-term target. Timelines for setting FLAG targets depend on the organisation’s current target status and activities such as setting a Net Zero target.

Does FLAG make it more difficult to set an SBTi?

It is too early to comment as most organisations are still reviewing the guidance and understanding the implications this has on their current or planned SBTi activity. Anthesis views this as a positive move from SBTi as it enables organisations with FLAG emissions in their value chain to directly address their land-based emissions but also account for their removals, which was not previously possible. However, some organisations have commented on the expanded coverage needed in their energy/industry target to achieve the 67% coverage in Scope 3.

Which type of organisations / sectors are affected by FLAG?

The GHG Protocol Land Sector and Removals Guidance provides accounting and reporting methods for removals. However, an organisation cannot use FLAG carbon removals towards non-FLAG Science Based Targets. Accounting for removals is entirely optional when setting a FLAG target. Anthesis is aware FLAG removals present a number of challenges when it comes to accounting for them in practice.

If you are not required to set a FLAG target, you can still account for removals within your organisation’s value chain for internal purposes. It is advised these are accounted for and calculated in line with the GHG Protocol Land Sector and Removals Guidance.

Which type of organisations / sectors are affected by FLAG?

There are certain sectors where FLAG emissions are required, for example, food production, processing or retailing, forestry products and tobacco. Otherwise, any other SBTi designated sector that has FLAG emissions accounting for more than 20% of overall emissions across all scopes.

There are a number of exceptions where organisations are not required to set a FLAG target:

• If a company falls under a FLAG-designated sector but has no or only limited FLAG GHG emissions.
• If they are classed as a small and medium-sized enterprise (SME), they should continue to use the SME target setting approach.
• FLAG targets are not required for wild-caught seafood.

How do you set a FLAG target if you operate across multiple categories of the FLAG SBTi?

The FLAG sector tool is the default target-setting tool that should be used for companies that fall within FLAG sectors that fall within the SBTi designated sectors. Organisations with emissions associated with one of the nine available agricultural commodity pathways that account for 10% or more of an organisation’s total FLAG emissions (across all emissions) may use the commodity pathway for that commodity.

Organisations can use both the FLAG sector and FLAG Commodity approach in the development of their FLAG target. If this is the case, organisations are then encouraged to consolidate targets into one combined (absolute) FLAG target using the aggregator tool.

How do organisations that have both aquaculture and wild capture fisheries in their supply chain set a target?

Organisations participating in aquaculture and wild caught fishing would fit within the ‘Food Production – Animal Source’ sector classification. However, as noted, wild-caught fish is exempted from being required to set a FLAG target. The organisation would need to separate emissions from aquaculture and wild-caught fishing within their GHG inventory. If the emissions from aquaculture are greater than 5% (across all scopes) they would be required to set a FLAG target for this area of their supply chain.

Are avoided emissions included?

The SBTi FLAG guidance follows the accounting guidance of the GHG Protocol, using an inventory approach rather than a project accounting approach. When avoided emissions refer to deforestation, this can be included in FLAG as both emissions and removals, if the right criteria are met. Avoided emissions based on product or material use or substitution are not included in inventory accounting.

Has the SBTi given any guidance on the scope of zero deforestation commitments?

Organisations setting FLAG targets are required to publicly submit a ‘no deforestation’ commitment, with a target to have deforestation free supply chains by 2025. This covers all scopes of emissions and is not limited to the same 67% threshold for Scope 3 emissions.

Organisations are highly recommended to align commitments with the Accountability Framework initiative (AFi) guidance, including a 2020 cut-off date and are further recommended to set no conversion commitments and no peat burning commitments.

How do we track and verify emissions related to raw material production in a complex multi-tiered supply chain, where there is no traceability?

Obtaining production data in complex global supply chains can be challenging. Successful collection and tracking of the production data relies on a thorough supplier engagement strategy. Anthesis has developed several programmes for substantial food retailers whose supply chains are broad and varied, successfully communicating data requirements from suppliers, and collecting primary data in return.

In the absence of primary data several other methods do exist, including activity-based and modelling-based methods.

What does my organisation need to consider when accounting for (land-based) removals under FLAG?

Removals may only be included in FLAG targets when the appropriate requirements are met:

• Ongoing storage and monitoring
• Traceability
• Primary data
• Uncertainty
• Reversals accounting​

More specific guidance can be found on page 22 of the GHGP Land Sector and Removals guidance draft.

Is it possible to account for FLAG removals even if our organisation is not required to set a FLAG target?

The GHG Protocol Land Sector and Removals Guidance provides accounting and reporting methods for removals. However, an organisation cannot use FLAG carbon removals towards non-FLAG Science Based Targets. Accounting for removals is entirely optional when setting a FLAG target. Anthesis is aware FLAG removals present several challenges when it comes to accounting for them in practice.

If an organisation is not required to set a FLAG target, it can account for removals within the organisation’s value chain for internal purposes only. It is advised these are accounted for and calculated in line with the GHG Protocol Land Sector and Removals Guidance.

Does land use change always equal emissions under FLAG?

Land use change could be calculated as a carbon removal if the right conditions are met. For example, reforestation and forest vegetation restoration that occurs on working lands (e.g. silvopasture, riparian planting/corridors, biodiversity bridges) are included in the FLAG sector target. However, removals may only be included in FLAG targets when the appropriate requirements are met. These include ongoing storage and monitoring, traceability, primary data, uncertainty, and reversals accounting.

Reforestation and forest restoration that occur outside working lands are excluded from targets because these efforts are outside organisation supply chains and thus outside its immediate influence.

Are carbon credits included in FLAG?

Organisations cannot purchase offsets to meet near-term FLAG or energy/industry targets. Only removals on land owned or operated by an organisation or within an organisation’s supply chain can be included in FLAG pathways and count toward achieving a FLAG target. Any sale or purchase of carbon credits should be handled in a company inventory following the GHG protocol guidance to avoid double counting.

Can insets be used to meet FLAG targets?

Emissions reduction and carbon removals on land owned or operated by an organisation or within an organisation’s supply chain can be included in an organisation’s inventory accounting and count toward achieving a FLAG target.