Nationally determined contribution
The reduction pledge a state sets for itself under the Paris Agreement, binding in its procedure and not in its outcome.
Paris Agreement, adopted December 12, 2015, in force November 4, 2016: each party submits and updates a nationally determined contribution every five years, and nobody tells it what to put in it. Earlier negotiations had failed to allocate a global effort among states. Paris went the other way: each country announces its own trajectory. The agreement requires each contribution to go further than the last, and a transparency framework makes the numbers comparable. The obligation is procedural. Submit, ratchet up, report: that is what binds legally, not hitting the target. So the sanction stays diplomatic and reputational, and no court condemns a state for missing its goal under the agreement itself. The first global stocktake, concluded in Dubai in December 2023, measured the gap between the sum of contributions and pathways consistent with the agreement. That gap now feeds the transition scenarios supervisors run. For an insurer, this is what anchors a scenario in something observable. When a large emitter raises or drops its contribution, the date at which a given coal or gas asset becomes stranded shifts inside the investment portfolio.
The Paris Agreement, adopted on December 12, 2015 and in force from November 4, 2016, requires each party to submit and update a nationally determined contribution every five years. It sets no binding outcome for what that contribution contains.
NDC, nationally determined contribution
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