The Role of Arbitration in ESG Disputes
The growth of disputes involving environmental, social and governance considerations has reinforced the role of arbitration as a mechanism for resolving ESG disputes.
The increasing incorporation of ESG considerations into business operations and commercial contracts has led to a rise in disputes involving environmental, social and governance issues, both in investment and commercial arbitration.
Arbitration offers several features that are particularly relevant for these disputes, including procedural flexibility, specialized arbitrators, the availability of interim measures, third-party participation and the international enforceability of awards. These tools make it possible to address technically complex disputes involving environmental matters, human rights and corporate commitments.
The evolution of international rules and standards on transparency, climate change, the environment and human rights also reflects efforts to adapt arbitration to the particular characteristics of ESG disputes. Although debates remain regarding transparency and the balance of resources between parties, these disputes are expected to become increasingly significant as ESG considerations gain greater relevance in international business.
