Sierra Club Joins Hundreds of Orgs. Calling on Governments to End ISDS System

The Sierra Club has joined a coalition of over 340 civil society organisations worldwide in urging governments to abandon the investor-state dispute settlement (ISDS) system. This open statement, released ahead of the First Conference on Transitioning Away from Fossil Fuels in Colombia, highlights how ISDS tribunals enable transnational corporations—particularly fossil fuel companies—to sue governments for policies that allegedly harm their profits. The coalition argues that ISDS provisions embedded in many trade and investment agreements undermine efforts to phase out fossil fuels and obstruct vital social and ecological transformations. ISDS has been criticised for disproportionately benefiting fossil fuel companies, which have won claims exceeding $87 billion through these secretive tribunals. The Sierra Club’s 2024 report, *Trading Away Our Climate*, detailed how outdated trade agreements protect corporate interests at the expense of climate action. The upcoming conference in Colombia marks a significant moment, as it is the first multilateral climate forum to explicitly address ISDS as a barrier to fossil fuel transition. Colombia’s president has also announced plans to withdraw the country from the ISDS system, signalling a growing political will to reform these mechanisms. Iliana Paul, Deputy Director of the Sierra Club’s Industrial Transformation Campaign, emphasised that ISDS and broader trade systems have long been skewed towards fossil fuel interests. She stated that these arrangements allow multinational corporations to operate at the cost of taxpayers, frontline communities, and the environment. Ending ISDS is seen as a crucial step towards establishing a fairer trade regime that supports climate progress and prioritises people over polluting industries. The open letter’s signatories represent a diverse range of organisations from more than 50 countries across multiple continents, including prominent groups such as Amnesty International, Oxfam International, Friends of the Earth International, and Climate Action Network Europe. This broad coalition reflects a growing global consensus on the need to reform trade and investment rules that currently hinder climate action. As the debate unfolds at the Colombia conference, the push to dismantle ISDS could have significant implications for international trade law and environmental governance going forward.