Preparing Legal Frameworks for Environmental Disasters: Practical Considerations for Host States

48 Pages Posted: 24 Aug 2020

See all articles by Brooke Guven

Brooke Guven

Columbia University - Columbia Center on Sustainable Investment

Perrine Toledano

Columbia University - Columbia Center on Sustainable Investment

Lise Johnson

Columbia University - Columbia Center on Sustainable Investment

Date Written: February 2020

Abstract

Projects in the extractives sector carry risks of lasting, and sometimes irreversible, damage to the environment. Nonetheless, these projects are important for accelerating the economic development of host countries. Governments seeking to mitigate the adverse effects of foreign investment often face push-back from investors that are unwilling to change their practices in order to avert environmental disaster. This report sets forth certain steps that host-governments can take during the pre-investment, operation, and enforcement phases of extractives projects to provide financial and other protection in the context of environmental disasters associated with private sector investments.

Upon comparative review of five Case Study Countries (Canada, Chile, the UAE, Indonesia, and Uganda), the authors of this report found that the most important factor impacting a host government’s ability to hold developers accountable for environmental harm is a gap between applicable environmental legislation and the enforcement of this legislation. The report then provides several recommendations for addressing this discrepancy, with an emphasis on the role of planning and robust legal and regulatory frameworks, as well as an analysis of a variety of safeguards (including, but not limited to, impact assessments, stakeholder engagement, and financial penalties) to be deployed at each of the three phases of a project. It also discusses the role of financial institutions in promoting best practices and mitigating risks and minimizing the fallout from investment-related environmental disasters.

Keywords: legal frameworks, environmental factors, economic development, impact assessments, stakeholder engagement, financial penalties

Suggested Citation

Guven, Brooke and Toledano, Perrine and Johnson, Lise, Preparing Legal Frameworks for Environmental Disasters: Practical Considerations for Host States (February 2020). Available at SSRN: https://ssrn.com/abstract=3660938 or http://dx.doi.org/10.2139/ssrn.3660938

Brooke Guven (Contact Author)

Columbia University - Columbia Center on Sustainable Investment ( email )

William C. Warren Hall, 1st floor
410 West 116th Street
New York, NY 10027
United States

Perrine Toledano

Columbia University - Columbia Center on Sustainable Investment

William C. Warren Hall, 1st floor
410 West 116th Street
New York, NY 10027
United States

Lise Johnson

Columbia University - Columbia Center on Sustainable Investment

William C. Warren Hall, 1st floor
410 West 116th Street
New York, NY 10027
United States

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