Global Plastics Treaty Talks End Without an Agreement – and Investors Are Taking Note

The fifth and supposedly final round of negotiations for a Global Plastics Treaty (INC-5.2) has concluded; not with progress, but with paralysis. Planet Tracker attended the Geneva negotiations and observed both the momentum among high-ambition countries and the tactics used to stall progress. Despite tireless efforts from many countries and civil society representatives – and the presence of environment ministers expected to help broker compromises – delegates in Geneva failed to reach agreement on even the basic building blocks of a legally binding treaty.

The outcome is clear: the current negotiation process is not fit for purpose. A system that requires full consensus has allowed a minority of powerful petrochemical-producing states to block ambitious provisions supported by the majority. Even with ministers in the room, there was little willingness to shift their stance. It’s clear this is not just a technical sticking point, but a real geopolitical clash over the future of plastics production.

The result is a draft text stripped of core regulatory elements:

• No global measures to reduce plastic production, despite over 100 countries calling for such provisions.
• No mandatory rules on chemicals of concern, despite mounting scientific evidence of their health harms.
• No voting mechanism for future action, despite 120 countries supporting it.

A Process Captured

The negotiations have been increasingly shaped by fossil fuel and chemical industry influence. An investigation by the Center for International Environmental Law (CIEL) found 234 fossil and chemical industry lobbyists registered at INC-5.2 – a record number, and likely an underestimate. This outsized presence of industry lobbyists (a trend becoming similarly conspicuous in the UN climate negotiations) has had a measurable impact: key text on production and toxic additives has been erased, diluted, or made voluntary.

Meanwhile, affected communities, from “Cancer Alley” in the U.S. to waste-impacted regions across Global Majority Countries, continue to live with the health and environmental costs of petrochemical production, incineration, and plastic waste dumping. They are calling for a treaty rooted in human health, justice, and full life-cycle accountability.

Why this Matters to Finance

Plastics pollution is no longer a peripheral ESG issue – it is now a material financial risk. Investors are seeing this clearly:

• Litigation is on the rise, including greenwashing lawsuits and state-level suits against plastic producers for misleading recyclability claims.
• Regulatory risk is growing, with new mandates emerging from California to the EU, and the possibility of fragmented rules if high-ambition countries act outside the UN process.
• Reputational risk is escalating for companies whose public environmental commitments contradict their behind-the-scenes lobbying.
• Insurance and liability exposure is emerging, with some parallels to asbestos and PFAS litigation.
• And systemic transition risk is intensifying as the world reckons with the overproduction and mismanagement of plastics.

The Finance Sector is Taking Action

The petrochemical industry is a central driver of plastic production and has played an outsized role in shaping the outcomes of the Global Plastics Treaty negotiations, including efforts to block ambition and delay meaningful regulation. This has also been noticed by investors.

Over the course of the INC process, more than 88 institutional investors representing $7.48 trillion in assets have signed a joint statement calling on petrochemical companies to:

1. Transparently disclose, define strategies and set clear targets to transition to production of safe, environmentally sound and sustainable plastic.
2. Address polymers and chemicals of concern in their products.
3. Build suitable infrastructure for production of sustainable materials.
4. Establish dedicated governance.
5. Publicly support an ambitious international legally binding instrument for ending plastic pollution.

In the weeks ahead of INC-5.2 alone, eight new investors added their names, a clear signal that momentum is growing and the finance sector is increasingly engaged. As progress stalls in the negotiating rooms, investors are sending their own message: plastic pollution is not just a long-term sustainability issue, but a pressing financial one that demands urgent attention from the companies most responsible.

What Comes Next

The INC process has not ended, but its legitimacy is increasingly under scrutiny as concerns grow more generally about the effectiveness of the multilateral approach in the environmental space. With the final round of negotiations stalling for a second time, there is growing pressure for meaningful reform. This could include alternative decision-making mechanisms that allow the majority of countries to advance effective rules, rather than being blocked by a small minority. Alternatively, high-ambition countries may choose to move forward outside the UN process in a “coalition of the willing” and pursue a standalone instrument.

For companies and investors, this uncertainty is itself a risk. A fractured regulatory landscape could mean accelerated compliance costs, trade disruptions, and reputational fallout. If governments cannot deliver alignment, capital markets may need to force it. Investors are already demanding action: delay carries cost, and inaction on plastics is no longer priced as an externality – it is a material, immediate and growing financial liability.

The Global Plastics Treaty is not yet a reality – but investor expectations are. The financial sector will continue to press for accountability, ambition, and alignment across the petrochemical value chain.