Navigating ESG arbitrability challenges in energy and climate: an in-depth analysis and future perspectives

Article


Olmos Giupponi, B. and Figueroa, R. 2024. Navigating ESG arbitrability challenges in energy and climate: an in-depth analysis and future perspectives. European Energy & Climate Journal. 12 (1), pp. 13-27. https://doi.org/10.4337/eecj.2024.01.02
TypeArticle
TitleNavigating ESG arbitrability challenges in energy and climate: an in-depth analysis and future perspectives
AuthorsOlmos Giupponi, B. and Figueroa, R.
Abstract

Over the past few years, there has been a notable surge in the inclusion of Environmental, Social, and Governance (ESG) clauses within both domestic and international agreements and contracts. This trend places a distinct focus on aspects related to climate change and energy. Implementation and enforcement challenges have emerged, prompting the exploration of remedies and procedural channels, wherein commercial and investment arbitration has gained recognition as a suitable dispute resolution mechanism. Against this backdrop, this article examines ESG clauses from both substantive and procedural perspectives, emphasizing their relevance to climate change and energy issues in light of the Paris Agreement. The study presents a thorough analysis of conceptual frameworks, content, scope, and implementation of ESG clauses. Additionally, it explores procedural pathways for enforcement, encompassing commercial and investment arbitration, highlighting their advantages and downsides. A critical analysis of recent arbitration cases involving ESG clauses provides insights into future implications. The study contributes to a deeper understanding of the challenges and significance surrounding the implementation of ESG clauses, particularly in the context of climate change and energy considerations, within contemporary international investment agreements and in the evolving landscape of commercial arbitration.

KeywordsEnvironmental; Social; and Governance (ESG) clauses; contractual obligations; enforcement mechanisms; arbitration; sustainability; climate change; energy transition; corporate governance
Sustainable Development Goals13 Climate action
Middlesex University ThemeSustainability
PublisherEdward Elgar Publishing
JournalEuropean Energy & Climate Journal
ISSN2211-9175
Electronic2666-576X
Publication dates
Print28 Mar 2024
Publication process dates
Accepted21 Mar 2024
Deposited11 Jun 2024
Output statusPublished
Accepted author manuscript
File Access Level
Open
Copyright Statement

This is a draft article © The authors, 2024.
The definitive, peer reviewed and edited version of this article is published by Edward Elgar Publishing Ltd in Energy & Climate Journal, Volume 12, Issue 1, pages 13–27 at https://doi.org/10.4337/eecj.2024.01.02

Digital Object Identifier (DOI)https://doi.org/10.4337/eecj.2024.01.02
LanguageEnglish
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