A new report from the International Institute for Sustainable Development (IISD) highlights critical advancements in cooperation and efficiency.
The international community is facing mounting pressure from a triple political crisis of mistrust, misinformation, and populism that tested the resilience of our global multilateral agreements. In the State of Global Environmental Governance 2025 report, the International Institute for Sustainable Development (IISD) provides a comprehensive overview of a year defined by significant institutional strain and a shifting geopolitical landscape. Despite these challenges, the report highlights critical advancements in cooperation and efficiency.
2025 saw an increase in global fragmentation, with numerous international conflicts and tensions reaching their highest levels since World War II. A significant event was the withdrawal of the United States from several key leadership roles. This disengagement was evident as the U.S. declined to send official delegations to major events, including the COP30 Climate Change Conference in Belém, Brazil and formally rejected the United Nations Sustainable Development Goals. The report notes a transition from the Cold War-era system to one where middle-income countries hold more influence, as the United States has largely relinquished its leadership role.
This political instability coincided with a severe liquidity crisis at the UN. By the end of the third quarter of 2025, member states owed nearly $1.6 billion USD in mandatory contributions. The UN Environment Programme (UNEP) faced a projected shortfall of $15.7 million USD, leading to cost-cutting measures such as freezing posts and cutting expenditures. Developing nations now face a $4 trillion USD annual financing gap for Sustainable Development Goals (SDGs) while dealing with rising public debt and shrinking foreign aid from major donors. To address these long-term sustainability issues, the UN launched the UN80 Initiative, aiming to create a more agile and integrated organization. The UN member states also developed and began implementing the Pact for the Future, a comprehensive global framework that outlines a total of 363 actions designed to help achieve a more sustainable, secure, and inclusive future.
The report draws attention to the urgent state of the environment through the Planetary Health Check 2025, which found that seven out of nine planetary boundaries have now been breached. This indicates that current progress in addressing the triple planetary crisis of climate change, biodiversity loss, and pollution remains insufficient.
A notable success in 2025 was the completion of a trifecta of science-policy bodies. The establishment of the Intergovernmental Science-Policy Panel on Chemicals, Waste and Pollution (ISP-CWP) now complements existing panels for climate change (IPCC) and biodiversity (IPBES).
The report also emphasizes a growing trend toward synergies. The Basel, Rotterdam, and Stockholm Conventions are cited as pioneers in this area, holding joint meetings to streamline administrative and technical support. Nationally, countries like Panama demonstrated this approach by creating an integrated nature pledge, harmonizing reporting for all three Rio Conventions into a single process to save resources.
A 2025 Advisory Opinion from the International Court of Justice provided a critical legal safeguard, clarifying that a state’s withdrawal from environmental treaties does not absolve it of its existing legal obligations under customary and human rights law. The court affirmed that mitigation and adaptation are legal duties rather than mere policy choices.
Looking toward 2026, the global community enters the final sprint for the 2030 SDG deadline. Key outcomes to watch include:
The 2025 report concludes that while the rules-based system faces unprecedented pressure, the drive for institutional reform and integrated policy approaches offers a pathway for maintaining global environmental commitments.
💡 The withdrawal of the United States from key climate commitments and regional environmental agreements presents a unique strategic opportunity for the remaining countries in the Americas to redefine environmental governance on their own terms. The departure of the U.S. from frameworks like the Commission for Environmental Cooperation and the Submission on Enforcement Matters (SEM) creates a governance gap that other nations can fill by building a more independent and resilient oversight mechanism. This shift allows for the negotiation of new multilateral agreements that are not tied to U.S.-centric trade priorities, offering a chance to create fairer and more balanced systems that serve the specific ecological and social needs of the broader geographic region. By leveraging existing infrastructure without the dominance of a single superpower, countries like Canada, Colombia, Peru, and Panama can join a modernized environmental framework that prioritizes shared accountability and collective action, turning a profound hit to global climate action into a catalyst for a more efficient and inclusive strategy.
💡 The changes in the legal landscape outlined in the report could drive demand for high-quality nature-based offsets. The International Court of Justice clarified that climate mitigation is a legal duty for states, not just a policy choice. This likely increases state demand for verifiable carbon projects to meet these obligations. Similarly, the Paris Agreement’s enhanced transparency framework is now operational, providing a sounder evidence base for ambitious policies that often rely on nature-based solutions.
