Climate change has emerged as a pressing global issue. The earth’s climate is now changing at an unprecedented rate, driven by our continued reliance on fossil fuels and non-renewable resources, which have significantly increased carbon footprints worldwide. Despite growing access to clean energy alternatives and a heightened awareness of the economic benefits of sustainability, the impact of climate change continues to intensify.
India, which is rapidly becoming the voice of the Global South, can implement measures to promote the achievement of climate mitigation goals in insolvency and restructuring procedures and set a high bar for other countries including developed economies. As climate change is primarily created by the excesses of the rich nations, India needs to continue highlighting that for the world to succeed in combating climate change, developed economies need to properly respect the principles of equity and common but differentiated responsibilities, and respective capabilities.
In this backdrop, ILA has drafted a Thought Paper which is the outcome of a Problem Paper presented by the Insolvency Law Academy (ILA) at a roundtable held on Friday, 19 April 2024 (April Roundtable) in New Delhi. Later, the draft of this Paper was presented at another roundtable held on Friday, 20 September 2024 (September Roundtable) in New Delhi. Both roundtables were attended by policymakers, lawyers, insolvency experts, and insolvency practitioners, from India and other parts of the world. Deliberations at the roundtable offered invaluable inputs in shaping this Paper and the recommendations made herein.
The Thought Paper argues that there is a stark juxtaposition between the goals of insolvency law and climate change risk mitigation and adaption, and advocates that India can use the Insolvency and Bankruptcy Code 2016 (IBC) to effectively address many risks arising for businesses from climate change.
We invite all to share their comments and based on feedback, a policy paper will be presented at the ILA Annual Conference scheduled from 14th to 16th March 2025 to be held at Tijara Fort Palace, Alwar, Rajasthan. Link for the conference Registration https://insolvencylawacademy.com/the-3rd-annual-conference/.
