Risk-Sharing: A Normative Framework for International Climate Negotiations

As countries are negotiating a new global climate agreement, this paper explores options for a mechanism on loss and damage. A highly intuitive formula is that of implementing a system of compensation based on historical accountability for past emissions. The paper highlights the shortcomings of this approach. It advances, instead, a risk-sharing approach within an adaptation framework. The central idea is to include – within the architecture of international cooperation – insurance-like policy mechanisms, extending safety nets to communities vulnerable to climate-related impacts. The merit of this approach is that it captures an important conception of justice, while responding to the challenges of multilateral decisionmaking. Its distinguishing feature is a convergence of considerations of justice with those of efficiency and durability.