People and Planet over Profits
It’s time for a fundamentally different approach to trade. We must create a new trade model that delivers good green jobs, healthy communities, and a stable climate while helping us transform the way we make the goods we need to thrive. We need to change the system from a race-to-the-bottom to one that’s rooted in fighting inequities, respecting workers’ rights, fostering resilient communities, and advancing climate and environmental justice.
Ending ISDS for Good
We need to get rid of outdated trade rules that prioritize corporate profits over people and the planet. Broad investor protections, which are included in dozens of trade deals around the world, including NAFTA 2.0, allow private actors to sue governments for public interest policies. These cases are settled in secretive tribunals and governments have no similar pathway to remedy when their people have been harmed by overseas corporations. Fossil fuel companies are especially ardent users of this system, known as investor-state dispute settlement (ISDS), and the awards to these companies are often staggering. Our report, Trading Away our Climate, explains how ISDS undermines climate action and how we can get rid of it once and for all. Read our press release here.
We have also helped lead a civil society movement to get our leaders to end ISDS, including a recent letter to President Biden, which was co-signed by over 200 labor partners, consumer rights groups, environmental advocates, faith groups, and more.
Fighting for High Road Standards in New Trade Deals
It’s not enough to get rid of old trade rules. We need new rules that govern how we do business with other countries. Any new or renegotiated trade agreements must include strong, binding, and enforceable environmental standards. Along with our partner, Evergreen Action, we released a set of recommendations for the Indo-Pacific Economic Framework for Prosperity, to ensure that this economic cooperation agreement centers climate change, thriving ecosystems, and healthy communities. We have also been advocating along with partners for the United States to ensure that any free trade agreements focused on securing critical minerals for the clean energy transition include similar high road environmental standards, along with strong labor and indigenous rights standards.
The United States-Canada-Mexico Free Trade Agreement (aka NAFTA 2.0) is up for review in July 2026. The Sierra Club wants to see this agreement updated so that it delivers good green jobs, lifts up communities, and slashes climate pollution. Sign up here if you want to get involved!
Getting Rid of the Carbon Loophole
Our current trade system has created a race-to-the-bottom where countries have historically lowered their environmental, labor, and human rights standards to attract foreign investment. This rewards dirty and unjust production practices and penalizes countries trying to do better. What’s more, the amount of greenhouse gases generated by the goods we import to the United States is equal to all of the climate pollution coming out of all American factories combined. We cannot continue to allow this carbon dumping loophole. An industrial transformation in the United States needs to be supported by a carbon dumping fee–or carbon border adjustment–that helps level the playing field between American-made goods and dirty imports. A Sierra Club report, Using Trade Tools for Industrial Transformation, presents some of the current carbon border fee policy designs in play and offers our vision for a truly transformative trade policy that ushers in a race-to-the-top. Read our press release here.
Read more about the recent proposals from members of Congress:
Adopting a Climate Peace Clause
The rules of global trade were written before governments were taking seriously the threat of climate change. Climate change isn’t even mentioned in any major trade deals. But now, countries are looking to use all of the tools at their disposal to prevent total climate disruption. Unfortunately, some of these measures, like the historical climate fighting investments in the 2022 Inflation Reduction Act, are coming under fire from other governments. These types of challenges are not new, but they are increasingly unsustainable. In order to protect progress on climate–and to up the ambition of governments around the world–we need to adopt a Climate Peace Clause. A Climate Peace Clause is an agreement between two or more countries to not challenge each other’s actions that target climate pollution and advance the transition to a clean energy economy. We wrote a discussion paper on what a Climate Peace Clause should look like with our partner, the Trade Justice Education Fund. We also joined a letter with partners to President Biden calling on the administration to adopt a Climate Peace Clause with the European Union to protect carbon dumping fee policies and proposals. With the IRA under attack, we have no time to lose.
Read More About our Vision for Climate-Friendly Trade:
A Sierra Club discussion paper from 2017 offers 15 ideas for how to bring decades-old trade rules, found in pacts like NAFTA, into alignment with today’s climate imperatives. They seek to fulfill three core goals:
- Protect climate policies
- Increase climate protections
- Mitigate climate impacts