Governments at the OECD initiated in 2021 the first major multilateral effort to consider climate policies for investment treaties. The alignment of investment treaties with the Paris Agreement is at the core of the work. This responds to growing demands to take action on the climate impacts of the investment treaty regime. For instance, Working Group III of the United Nations’ Intergovernmental Panel on Climate Change (IPCC) expressed concern about the role of existing investment treaties and investor-state dispute settlement for fossil fuel regulation in its 2022 report.
OECD work to date has included (i) a public consultation with over 40 submissions; (ii) two public Conferences; and (iii) the first-ever survey of climate policies for investment treaties; and (iv) an ongoing series of meetings with governments, experts and stakeholders.
The December 2023 Global Stocktake at COP28 injects still greater urgency into the Paris and net zero alignment of investment treaties. Many governments, climate scientists, civil society organisations and companies urged national governments to address fossil fuels in the Stocktake as the primary cause of climate change. The ultimate compromise was a call for "transitioning away from fossil fuels in energy systems”, together with tripling renewable energy capacity by 2030 and phasing out inefficient fossil fuel subsidies.
In a context of advances in the Global Stocktake, the November 2023 decision at the OECD to extend work to develop methods to effectively align investment treaty policies with the Paris Agreement goals is an important development. There is an urgent need to develop techniques for alignment.
Following opening remarks and an introductory session with the latest analysis of the energy transition from senior policy leaders, the 2024 Conference will turn to potential methods for alignment in several fields. The Conference will build on the general consideration of alignment at the OECD Investment Treaty Conferences in 2022 and 2023 as well as other recent work.
