The Procurement Implications of ICJ's Climate Obligations

With the Paris Agreement aiming for a 1.5-2°C carbon emission reduction by 2030, businesses are focusing on the environmental impact of their procurement processes.

The International Court of Justice (ICJ) has issued an Advisory Opinion confirming that states have legal obligations to prevent and mitigate climate change. This ruling emphasises the role of procurement as part of a larger strategy to fulfil international climate agreements.

Procurement and climate law

The ICJ clarified states' responsibilities concerning climate change, a move that will impact procurement regulations.

All states must ensure due diligence to avoid causing environmental harm, focusing on reducing greenhouse gas emissions. This affects global supply chains, prompting procurement executives to reconsider their practices in alignment with international duties.

IUCN's influence

The International Union for Conservation of Nature (IUCN) significantly influenced the proceedings.

It presented legal and scientific advice, impacting how procurement practices are seen under international law.

"IUCN welcomes this important Advisory Opinion, which strengthens the global legal framework and reinforces the urgent imperative to limit warming to 1.5 °C," says Dr Grethel Aguilar, IUCN Director General.

Dr Aguilar stressed that climate change impacts not just temperatures but also human rights and ecological balance. Thus, procurement must address these broader implications by aligning supply chain strategies with stated environmental goals.

Legal clarity in procurement

The ICJ reiterated that obligations arise from climate treaties, customary international law and human rights law.

"The highest judicial body of the UN has spoken and it has spoken clearly: every state has an obligation under international law to act with a stringent level of due diligence to prevent global warming from exceeding the 1.5°C threshold," explains Prof Christina Voigt, Lead Counsel and WCEL Chair.

This increased legal clarity suggests that procurement functions must incorporate compliance with a variety of legal obligations spanning several branches of international law.

This impacts contract negotiations and supply chain choices, ensuring adherence to environmental commitments.

Implications for climate inaction

The ICJ's Opinion outlines consequences for failing to meet climate obligations, detailing that breaches can lead to mandatory compensations and accountability.

For procurement officials, this highlights the financial and operational risks associated with non-compliance. Responsible states need to stop wrongful conduct and guarantee against repetition, ensuring supply chains are sustainable and compliant.

Furthermore, the ICJ acknowledges the scientific capability to trace state-level contributions to emissions, enhancing accountability.

This reinforces the necessity for procurement strategies to integrate environmental impact assessments when formulating policies and agreements.