Globally, governments, scientists and financial market players have become aware that environmental issues have a direct impact on both humanity and the global financial system. 

While businesses risk bankruptcy as economies adapt to environmental risks and opportunities, insolvency legal frameworks have not enabled the development of best practices or policies to keep pace with these changes. However, insolvency law can be a tool that facilitates the transition of businesses to environmentally compatible activities.

This Conference will examine the nature of the risks, the best way to help businesses and other economic actors adapt and contribute to international transition goals, the possibility of taking environmental considerations into account when choosing insolvency solutions, and the tools that may be needed to promote cross-border cooperation if insolvency law is to truly take climate and environmental issues into account. 

This round table will examine the fundamental question that arises at the intersection of insolvency law and environmental concerns. This reflection is part of the long-standing debate on the role of insolvency proceedings: should they focus solely on the interests of existing creditors or pursue broader social objectives?

The discussion will explore how environmental considerations fit into this spectrum and determine whether public interest concerns should influence the outcome of insolvency proceedings only in specific high-risk sectors subject to special regimes, or more broadly, considering pervasive environmental damage.  

The purpose of this discussion will be to gather expert opinions on the technical means and options for taking environmental concerns into account in insolvency proceedings. This could include, for example, how discretion is exercised in approving restructuring or liquidation plans, with a view to potentially removing the assets or activities of distressed debtors from harmful activities. 

The expert group will also examine the role of environmental liabilities (legacy liabilities), including relevant discharge/waiver options, the possibility of appointing an administrator or similar representative of stakeholders to defend the public interest, and the effect of accounting standards and financial requirements that aim to assess the level of sustainability of activities. 

This round table will examine how the insolvency obligations of directors and parent companies intersect with environmental issues. It will explore current national laws and international standards and assess how these frameworks influence behaviour and how they could be adapted to create incentives to take environmental externalities into account.

The discussion will focus on how these obligations can help prevent environmental damage and increase sources of compensation for damage caused, thereby reducing future burdens on creditors and taxpayers.  

Moderator: 

This round table will examine specific changes to be made to the UNCITRAL Legislative Guide on Insolvency Law and cross-border model laws, drawing on the issues addressed by previous round tables.

Experts will examine developments in the formulation of the role and (common) objectives of insolvency law, based on the concept of fairness (substantive and procedural). Amendments to UNCITRAL texts could include recognition of environmental financial risks/impacts and how they could be prioritised and addressed in the design of insolvency risk treatment mechanisms, in insolvency proceedings and in cross-border insolvency. Should environmental impact influence choices in the context of insolvency? Can we improve cross-border frameworks and, possibly, take into account the relatively more precarious situation of vulnerable communities that are severely affected, particularly in Southern countries, including the possibility of refusing recognition and enforcement of foreign proceedings that have adverse effects on local environmental concerns? Can international comity be a useful tool in this context to promote recognition and relief?