The reduction pledge a state sets for itself under the Paris Agreement, binding in its procedure and not in its outcome.
The Paris Agreement abandoned the allocation of a global effort between states, the method that had wrecked earlier negotiations, in favor of an arrangement in which each announces its own trajectory. A nationally determined contribution is that pledge, revised every five years with a requirement of progression, and submitted to a transparency framework that makes trajectories comparable. The strength of the arrangement is procedural: what is legally binding is to submit a contribution, to raise it and to report on it, not to achieve it, so the sanction is diplomatic and reputational rather than judicial. Successive global stocktakes have measured the gap between the sum of submitted contributions and pathways consistent with the agreement's goals, a gap that has become the input to the transition scenarios financial supervisors use. For an insurer these pledges anchor scenarios in something observable, and raising or abandoning them directly moves the date at which stranded assets become stranded.
The Paris Agreement, adopted on 12 December 2015 and in force from 4 November 2016, requires each party to submit and update every five years a nationally determined contribution, without imposing any obligation of result on its content.
NDC, nationally determined contribution, CDN, engagement national climat