New York Law Journal
March 12, 2021
In recent years, investor-state arbitration, or investor-state dispute settlement (ISDS), has faced intense political criticism. The international arbitration community has responded by implementing a plethora of reforms to the arbitration process. However, these reforms cannot, on their own, fully address the criticisms heaped against investor-state arbitration. This is because the criticisms stem from a political backlash against the perceived inequitable distribution of benefits from international trade and capitalism. Voters in many countries are also increasingly focused on enforcing environmental, social and corporate governance (ESG) norms. Arbitration often becomes a collateral victim when elected officials take aim at treaties that do not keep pace with these norms.