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In preparing this report, the ESG Subcommittee of the IBA Arbitration Committee, with the assistance of the IBA Business Human Rights Committee, set out to establish what role arbitration may have to play in the resolution of contractual ESG disputes. To investigate these questions, the ESG Subcommittee adopted three lines of research: (i) desk research; (ii) a survey conducted by the IBA ESG Subcommittee in 2021 of in-house counsel and compliance staff members at large multinationals, supported by (iii) roundtable discussions in 2021 and 2022 with in-house counsel to discuss the types of ESG clauses which were seen in practice and the extent to which in-house counsel had experience of resolution of such disputes and the appropriateness of certain dispute resolution mechanisms, including arbitration.
Given that arbitration is a consensual process, it is likely to play a role in business-to-business disputes in relation to ESG obligations where arbitration clauses are included in contracts which also contain ESG obligations. Alternatively, where ESG obligations are included in investment treaties between states and because such treaties typically include arbitration as a means of dispute resolution, we are likely to see ESG concerns addressed through arbitration proceedings. For this reason, Chapters B and C survey the ESG obligations found in contracts and investment treaties respectively and how and where they may play a role in dispute resolution. Chapter D describes what dispute resolution procedures have been adopted to resolve ESG disputes, including arbitration.
The work undertaken to produce this report has spanned the lifetime of two iterations of the ESG Subcommittee of the IBA Arbitration Committee; first under the stewardship of Co-Chairs Angeline Welsh KC and Christián Conejero and second under Anna-Maria Tamminen and Patrick Pearsall.
The ESG Subcommittee is indebted to the following individuals who assisted in the original research for this report, devising the survey which conducted in 2021 and leading the roundtable discussions in 2021 and in 2022: Julianne Hughes-Jennett, Merryl Lawry-White, Stacylyn Doore, Nicola Swan, Antony Crockett, Judith Levine, Sofija Cvitanovich, Martijn Scheltema and Mubarak Wassem.
The ESG Subcommittee also received, and is very grateful for, support from colleagues from the IBA Business Human Rights Committee and the IBA Environment, Health and Safety Committee in devising and promoting the survey.
Significant thanks are due in particular to Julianne Hughes-Jennett, Merryl Lawry-White, Nayomi Gooneskere and Marjun Parcasio for their hard work in decoding the results of the original research, their secondary research and drafting of this report, and to Angeline Welsh KC, Julianne Hughes-Jennett and Merryl Lawry-White in finishing the report for publication purposes.
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