Navigating the 2026 GHG Protocol Land Sector and Removals Standard
Accounting for agricultural emissions and carbon removals in supply chains
Blog contents
On January 30, 2026, the Greenhouse Gas (GHG) Protocol published the Land Sector and Removals (LSR) Standard which draft has been in use by relevant sectors for up to four years. With the accompanying calculation guidance slated for Q2 2026 and a mandatory effective date of January 1, 2027, the grace period for land-based emission blind spots has come to an end. For UK directors and sustainability managers (particularly those in the food, beverage, apparel, retail, and agriculture sectors), this standard cements the rules for tracking land-use change, agricultural leakage, and biogenic carbon removals within your scope 3 GHG inventory. Understanding these new accounting methodologies is great for effectively identifying material land emissions (which account for 22% of global emissions) in the value chain and reducing emissions in a credible way.
- The 2026 Milestone: The finalised LSR Standard was published in January 2026 and will come into force on 1 January 2027.
- Forestry Delayed: The current standard explicitly covers agriculture and CO2 removal technologies; forest carbon accounting remains under development by a dedicated Technical Working Group.
- Traceability Mandates: New requirements demand jurisdictional data or mass-balance approaches to trace commodities back to their sourcing regions.
- Agricultural Leakage: Companies must now account for indirect land-use impacts using the newly defined “carbon opportunity cost” metric.
Formalising the Scope 3 Land-Use Data Gap
Scope 3 land-based emissions are difficult to quantify. The LSR Standard has been helping ease this by demanding entity-level accounting for direct land-use change (dLUC), ongoing land management practices, and biogenic product emissions.
For procurement and supply chain directors, this means generic, national-level emission factors for commoditised inputs like soy, beef, cotton, or leather aren’t sufficient as a long-term approach. The standard introduces tiered traceability requirements and accommodates the reality that deep supply chain visibility takes time to build. Where direct physical traceability to a specific farm is not yet achievable, the standard permits a “mass-balance with safeguards” approach or “jurisdictional dLUC” data, which draws on regional-level deforestation rates as a credible interim measure.
In practice, a phased approach is both feasible and advisable, like the gradual development of scope 3 data quality over time. The most effective starting point is a materiality assessment: identify which commodities and sourcing regions carry the highest LUC risk, and prioritise traceability investment there. Many companies in relevant sectors have already been working towards this under years of draft guidance, so the direction of travel is not new. Organisations that build geographic fidelity into their supplier mapping incrementally will be better positioned than those delaying engagement altogether.
Supply chain engagement has become increasingly common in carbon accounting to improve scope 3 accuracy. The LSR Standard makes it a necessity for those in scope. This should not be a one-way data collection exercise – the Standard exists to enact positive change and supply chain partners must work collaboratively to succeed in the long-term.
Sam’s key points:
- Traceability is key
- Impact on supplier engagement and procurement decisions
- Reporting transition – doesn’t have to be perfect from day one
- Removals are optional and treated separately for a reason – more impactful to focus on genuine reductions within the value chain
With everything, take a risk-based approach – focus on what is most material to begin with
The Carbon Opportunity Cost and Agricultural Leakage
An element finalised in the 2026 standard is the treatment of agricultural leakage, or the indirect emissions that occur when agricultural production shifts to new, unmanaged areas to meet global demand. The GHG Protocol now requires companies to use the carbon opportunity cost metric to measure these impacts outside their immediate value chain boundaries.
For operations and sustainability roles, this necessitates a much more holistic view of sourcing and intervention strategies. If your company initiates a project that reduces agricultural yield in a specific region (even if done in the name of regenerative agriculture or reduced fertiliser use), you must now actively account for the potential emissions generated if that lost yield is replaced by deforestation elsewhere in the world. This requirement prevents companies from superficially lowering their GHG inventory by simply shifting intensive production burdens onto unmanaged lands. It encourages a strategic balance between improving on-farm ecological health and maintaining necessary crop yields.
For organisations purchasing agricultural goods to make informed procurement decisions through quantifying the emissions impact, buyers will require partners who can provide farm-, or at least regional-level traceability and balance this with cost and volume constraints.
Strict Rules for Corporate Carbon Removals
Beyond emissions, the LSR Standard provides overdue clarity on how to credibly report carbon dioxide removals (CDR). A core tenet of the new standard is effectively separating true physical removals from emission reductions. The framework requires companies to report removals and emissions as distinct line items; you cannot simply subtract biogenic removals from your gross emissions to claim a lower net-carbon footprint.
Additionally, the standard establishes criteria regarding permanence, data quality, and allocation. If a company is claiming removals through in-setting projects like enhanced soil organic carbon or technological removal methods, these must be proven by primary data and repeated sampling intervals occurring at least every five years. To mitigate the risk of reversal (where stored carbon is accidentally released back into the atmosphere via fire, tilling, or disease) the standard introduces safeguards, like the mandatory use of buffer pools or reserve accounting approaches. For those overseeing public net zero claims, this ensures that reported removals are scientifically defensible and resilient to greenwashing risks under frameworks like the UK’s Green Claims Code.
In line with a science-based Net Zero pathway, the focus should be on genuine emissions reduction to effectively manage exposure to climate risk and avoid negative environmental impacts, rather than balancing them out.
Alignment with SBTi FLAG Targets
The release of the LSR Standard triggers a cascading compliance timeline for companies using the Science Based Targets initiative (SBTi). The GHG Protocol methodology serves as the accounting rulebook for the SBTi’s Forest, Land and Agriculture (FLAG) guidance.
Companies that have already validated FLAG targets with the earlier draft guidance will need to recalculate their base year emissions to align with the finalised LSR Standard when it takes effect in January 2027. More critically, the standard’s finalisation starts the countdown for organisations with existing science-based targets that have significant land-sector activities. They will be required to submit formal FLAG targets before the end of their five-year review period (as mentioned in FLAG Guidance v1.2 published in March 2026) and make a public commitment to no-deforestation across primary commodity supply chains.
Preparing for 2027 Enforcement
January 2027 is fast approaching and the complexity of supply chain mapping and primary data collection required by the Land Sector and Removals Standard demands action sooner. Directors must initiate gap analyses of their current GHG inventories now, focusing on agricultural commodities, historical land-use changes, and traceability blind spots. By treating 2026 as a capability-building year, your organisation can build the robust systems necessary to transform land-use from a looming accounting liability into a demonstrable sustainability asset.
References
- Greenhouse Gas Protocol (2026). Land Sector and Removals Standard.
- Science Based Targets initiative (SBTi) (2025). Forest, Land and Agriculture (FLAG) Target Setting Guidance.
About the author
Sam is Principal Consultant and supports our customers on their sustainability journey, through measuring and reducing emissions and reporting impact against frameworks.
