The New Rulebook for Land-Sector Carbon Accounting

LSRS at a Glance

• The Land Sector and Removals Standard (LSRS), Version 1.1, takes effect January 1, 2027, and applies to agriculture and carbon dioxide removal technologies — not forestry.  
• LSRS standardizes how companies account for land-use change, land management, biogenic products, carbon removals, and reversals.  
• For farmers, wider buyer adoption of the LSRS could, over time, translate to greater alignment across buyer programs, but credible claims will depend on better data, traceability, and cross-sector collaboration.  
• The Greenhouse Gas (GHG) Protocol, a multi-stakeholder partnership of businesses, non-governmental organizations (NGOs), governments, and others, develops the accounting standards that underpin corporate GHG reporting.  
• The LSRS is not an optional program: Companies with significant land-sector activities must apply it to conform with the GHG Protocol’s Corporate Standard and Scope 3 Standard. In addition, the Science Based Targets Initiative (SBTI) requires all companies setting Forest, Land and Agriculture Guidance (FLAG) targets to use the final standard from January 1, 2027. 

For years, companies have set climate goals for factories, fleets, and purchased energy using established greenhouse gas accounting conventions. Setting and meeting climate goals for land and soils, however, is a much more complicated prospect. Crops and the soils they depend on are dynamic components of larger agricultural systems and inextricably linked to the natural world. Crops and soils interact with regional weather and broader climatic shifts, and plants absorb carbon as they grow. Likewise, soils can gain or lose carbon as land-use patterns change, and stored carbon can later return to the atmosphere. Added to these complexities is the movement of these crops, often without farm-level traceability, when they’re sold into long, interdependent supply chains.

The LSRS brings all these dynamics into a common corporate accounting framework. Published in 2026 and effective January 1, 2027, the LSRS is the “first GHG Protocol standard to provide greenhouse gas (GHG) accounting requirements and guidance that equip companies with the methods needed to quantify, report, and track land emissions and CO₂ [carbon dioxide] removals.” Forest carbon accounting remains outside its current scope while the GHG Protocol continues separate stakeholder work on that issue.  

The standard is not a regenerative agriculture certification, a carbon-credit methodology, nor a list of preferred farm practices. Instead, it’s an accounting and reporting framework for land emissions and carbon dioxide removals. Its coverage extends beyond crops and soils to technological removals, like direct air capture, carbon dioxide capture with geologic storage, and biogenic and technology-based removal products. LSRS gives companies a consistent way to define inventory boundaries, identify relevant emissions and removals, evaluate data, and report results across operations and value chains.  

How does the LSRS relate to FLAG?

The LSRS is often discussed alongside the Science Based Targets Initiative’s Forest, Land and Agriculture Guidance (FLAG). FLAG provides requirements and methodologies for setting science-based land-sector targets, while the LSRS provides the accounting foundation companies use to quantify and report the activities covered by their greenhouse gas inventories.

Put simply: FLAG helps define the destination, while the LSRS helps establish the measurement system. SBTi’s FLAG Guidance Version 1.2, published in March 2026, explicitly strengthens alignment with the new GHG Protocol standard. Companies should treat the frameworks as complementary rather than interchangeable.

What does the LSRS cover?

The LSRS empowers the GHG Protocol Corporate Standard and Scope 3 Standard. Its requirements address several areas that have historically been difficult to handle consistently in corporate inventories:

• Land-use change emissions – accounting for emissions associated with changes in land use, including relevant direct changes connected to agricultural production
• Land occupation – reporting the agricultural land a company relies on, measured in hectares across scope 1 and scope 3, as a physical metric alongside emissions
• Land carbon leakage – accounting for indirect land-use impacts when corporate actions displace food or feed production and drive conversion beyond a company’s own operations and value chain, quantified in CO₂e (carbon dioxide equivalent) using the carbon opportunity cost approach
• Land management emissions and removals – accounting for production emissions and changes in land carbon stocks associated with managing agricultural land
• Spatial boundaries and traceability – matching the granularity of the emission factor to the granularity of the evidence. To use a sourcing region, land management unit, or harvested area emission factor, a company must demonstrate physical traceability at that same level through an accepted chain-of-custody model: identity preservation, segregation, controlled blending, or mass balance with safeguards. Where farm-level traceability is not yet achievable, jurisdictional direct land-use change data offer a credible interim step.  
• Biogenic products – reporting emissions associated with products derived from biological materials across the value chain
• CO₂ removals and storage – accounting for qualifying removals stored in land or geologic carbon pools, including technological removal activities
• Reversals – recognizing that stored carbon may be released later and must be monitored and reported appropriately
• Product carbon storage – providing requirements for companies that choose to report carbon stored in products

An essential principle runs through these requirements: Emissions and removals need to be visible as distinct components of the inventory. Companies need transparent categories, defensible methods, and data capable of supporting the reported result.

Why does LSRS matter for regenerative agriculture?

Regenerative agriculture programs are rapidly expanding, but the reporting landscape remains fragmented. For example, a farmer producing corn, wheat, and soy in rotation may encounter different buyer programs for each crop, even when those programs request similar information. Separate platforms, practice lists, contract terms, and measurement approaches can create duplication and cost without producing a clear view of outcomes across the farm or sourcing region.

The LSRS won’t eliminate this complexity, but it can create a stronger basis for alignment. When buyers use a common accounting framework, they have more reason to coordinate data needs and support across crops, rotations, elevators, and supply sheds. That can reduce pressure to treat each commodity or customer program as an isolated exercise.

The standard also shifts attention toward measured outcomes, driving meaningful financial and understanding of risk reduction on farms. Practices such as reduced tillage, cover cropping, nutrient-management changes, agroforestry, or working-land restoration may contribute to lower emissions, additional removals, or improved soil function, but their effects vary significantly by location and management system. The accounting question now matches action to results, answering the question: What measurable greenhouse gas outcome can be supported by real evidence?

Nick Betts, Director of Climate Solutions, speaks about LSRS and regenerative agriculture on the Market Talk podcast (August 2026).

What should companies do to prepare for LSRS compliance?

For companies with significant agricultural activities in their operations or value chains, implementation will require more than updating a disclosure template. Implementation begins with an applicability and materiality screen, then extends into inventory design, procurement, supplier engagement, data governance, and assurance readiness. We offer a breakdown of the steps:

• Clarify applicability and boundaries. Determine where significant agricultural activities occur in Scopes 1 and 3, and which LSR categories are relevant.
• Map commodities and sourcing regions. Identify the products, suppliers, aggregators, and geographies that drive land-sector emissions and potential removals.
• Assess traceability and data quality. Document what data are available from farm, field, supplier, facility, or sourcing-region level, and where estimates or secondary data are still necessary.
• Separate emissions from removals. Design inventory systems that preserve transparency.
• Plan for reversals and monitoring. Establish an approach for ongoing storage monitoring and potential release of previously stored carbon.
• Align climate targets and claims. Review how the new accounting categories affect existing GHG inventories, SBTi commitments, supplier programs, and public statements.
• Engage farmers early. Build data and incentive structures with producers, rather than imposing globally uniform practices that may not fit local agronomic conditions.

The Farmer Voice is Indispensable

Successful transition to this reporting approach will depend on whether companies can translate accounting requirements into workable agricultural programs. Farmers manage biological systems under changing weather, soil types, crop rotations, equipment constraints, and market conditions. A practice that improves outcomes in one region may be ineffective (or inappropriate) in another.

For these reasons, outcome-based accounting should not become a top-down prescription. Companies need farmers and local agronomic experts at the table when selecting methods, establishing baselines, designing monitoring systems, and deciding how value and risk are shared. Better accounting can create leverage for investment, but only credible, practical implementation will turn that leverage into durable improvements in soil health, productivity, and supply-chain resilience.

A Common Language

The LSR Standard is a major step toward consistent land-sector carbon accounting, but it is not a universal solution. Version 1.1 does not cover forestry, and organizations will still need to make careful judgments about significance, traceability, methods, data quality, and reporting boundaries. Nor will a common standard automatically resolve the commercial realities that determine whether farmers can participate in climate programs.

What the LSR Standard can do, though, is give companies a shared language for measuring land-sector impacts as well as a clearer reason to collaborate across supply chains. When used well, the standard can help move regenerative agriculture programs away from fragmented practice checklists and toward transparent, outcome-oriented systems that recognize where emissions occur, where carbon is stored, and who makes those outcomes possible.

For companies preparing for 2027, the most productive first steps are to understand the new accounting architecture, identify the material gaps in current data and traceability, and begin working with suppliers and farmers on a credible implementation plan.

Ready to strengthen your understanding and implementation of LSRS?

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Helpful Resources and Further Reading

Listen to Nick Betts, Director of Climate Solutions at SCS Consulting Services, speak on the Market Talk podcast about new standards for regenerative agriculture practices

GHG Protocol: Land Sector and Removals Standard overview

GHG Protocol: Land Sector and Removals Standard, Version 1.1

Science Based Targets initiative: FLAG Guidance Version 1.2 update

SBTi: FLAG Guidance in Brief, Version 1.2

About the Author

Nick Betts is Director of Climate Solutions at SCS Consulting Services, where they support companies in translating climate ambition into practical, measurable action. With more than 15 years of experience across sustainability consulting, agriculture, and climate strategy, Nick has led complex initiatives involving greenhouse gas accounting, decarbonization planning, regenerative agriculture, supply-chain sustainability, and multi-stakeholder collaboration.  

Prior to joining SCS Consulting, Nick served as Executive Director of the Canadian Alliance for Net Zero Agri-Food (CANZA), leading efforts to advance climate-smart farming and develop collaborative approaches to agricultural transition. Earlier roles included leadership positions with SAI Platform and sustainability consulting organizations supporting global food, agriculture, and consumer goods companies. Nick's work focuses on helping organizations navigate evolving climate expectations, build credible implementation pathways, and create solutions that balance environmental integrity with business performance. Nick holds a B.Sc. (Hons.) in Ecology from the University of Guelph and an MBA in Leadership and Sustainability from the University of Cumbria.