A Discussion with Martina Polasek on the Future of Arbitration
THE AUTHOR:
Anne-Sarah Maleville, LL.M. Candidate at Georgetown University Law Center
On March 4, 2025, Paul Hastings in Washington, D.C., hosted a thought-provoking discussion on the future of arbitral institutions featuring Martina Polasek, Secretary-General of the International Centre for Settlement of Investment Disputes (ICSID), and Jonathan Hamilton, Partner at Paul Hastings. Against a backdrop of shifting geopolitical and economic realities, the conversation explored ICSID’s adaptation, its role in international arbitration, and its response to current global challenges.
With over 1,000 cases registered, ICSID stands as a pillar of investor-state dispute resolution. But in a world of shifting geopolitics and increasing scepticism towards investor-state dispute settlement (“ISDS”), one might ask—echoing Jonathan Hamilton’s reference to William Faulkner’s 1950 Nobel Prize speech in Stockholm— will ICSID simply endure or continue prevailing as the dominant forum for investment disputes?
The Parallel Evolution of Globalization and International Arbitration
Martina Polasek’s journey in international arbitration mirrors the evolution of globalization itself. With a profoundly international background that spans Czech Republic, Sweden or even France, she emphasized that globalization is not merely economic integration but also cultural and legal interconnectedness—an understanding of different languages, systems, and traditions.
When she first encountered arbitration in the 1990s, it was not even offered as a university course. Her exposure to the field came through the UNIDROIT Principles, as she was a strong believer in the lex mercatoria at the time. Joining ICSID almost a quarter of a decade ago, in 2001, as a junior counsel, she witnessed the institution’s evolution firsthand: back then, ICSID had no Secretary-General, only 85 registered cases, and no paralegals. Critical documents were transmitted via fax machines, and award deliveries were “honored” by formal ceremonies – as Hamilton also recalls.
Founded post-World War II as a neutral and rules-based dispute resolution mechanism, ICSID was designed to promote cross-border investment.
On the one hand, Polasek underlined however that today’s debates on ISDS often focus too narrowly on disputes themselves, rather than the broader objective of fostering international investment—and ultimately, economic development. Disputes, she emphasized, should not be feared—they are a natural consequence of economic activity and a sign of a functioning legal system that ensures access to justice.
On the other hand, the institution continues to expand, with growing membership under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (1965) (“ICSID Convention”) and numerous treaties referring to ICSID arbitration as the preferred dispute resolution mechanism.
The Current Landscape: A Shifting Legal and Economic Order
The global landscape for investment arbitration is deeply influenced by geopolitical tensions. Free trade, once a driving force behind economic policy, is losing favor in some regions. Many states are revisiting, or even terminating, the treaties—bilateral or multilateral—that once unified them. Empirical studies diverge on whether treaty protections and access to arbitration are, in fact, key drivers of investment—leaving room for debate on the relevance of the current system.
Additionally, continuous criticism of ISDS, rather than fostering constructive dialogue or meaningful reform, risks undermining confidence in the system and deterring investment by creating an atmosphere of uncertainty and distrust.
Jonathan Hamilton observed that ongoing discussions on ISDS often become mired in perfecting treaty language rather than addressing fundamental concerns about investment protection. He invoked the adage “the perfect is the enemy of the good,” noting that efforts to modernize instruments such as the Energy Charter Treaty (1994) (“ECT”) have been derailed by deeper, structural disagreements.
ICSID plays a role in the current multilateral discussions, such as UNCITRAL’s Working Group III, by providing day-to-day data to ensure the reliability of their findings. However, Polasek acknowledged that the institution does not engage substantively in the group’s policy debates, reflecting ICSID’s commitment to procedural neutrality. Given that countries often express diverging interests, the institution facilitates ongoing dialogue while maintaining non-partisanship and refraining from influencing substantive outcomes.
ICSID’s Competitive Edge: A Predictable, Adaptable and Evolving System
Despite the turbulent geopolitical climate, ICSID remains the leader in investment arbitration due to its predictability and procedural rigor, according to Polasek. To enhance its reliability, ICSID is working on updating its model clauses and actively promoting expedited arbitration—an initiative designed to limit criticisms that investment arbitration is too costly and time-consuming.
As Polasek so depicts, ICSID’s comparative advantages include an unprecedented enforcement mechanism under the Washington Convention, a system uniquely tailored for investment arbitration and high-quality services provided by the ICSID personnel itself for parties, counsel, and arbitrators. We must also add the limited post-award remedies.
In 2024, the institution registered 55 new cases and celebrated its 1,000th case. The most frequently represented sectors and industries include oil, gas, mining, and renewable energies.
The Future of Arbitration: Moving Towards More Diversity
A key challenge for ICSID—and the arbitration field more broadly—is improving diversity in arbitrator appointments. This includes diversity across gender, linguistic backgrounds, geography, legal traditions, and areas of expertise. Polasek stressed that diversity must be nurtured early in a lawyer’s career—as arbitrators do not start as such, but gain expertise throughout their career before their first appointment.
While ICSID supports the promotion of newcomers, it must also balance this goal with the parties’ request for the most experienced—and often busiest—professionals, respecting both institutional priorities and party autonomy in selecting arbitrators.
As she concluded, Polasek expressed optimism about the future of ISDS, emphasizing that the system is rapidly evolving and adjusting to stakeholders’ needs. To ensure its continued relevance in a changing global order, ICSID is increasingly promoting innovative dispute resolution methods, including mediation and expedited arbitration. She described the institution as “the coolest place to be,” underscoring her belief that investment arbitration, with ICSID as a leader, will not only endure but prevail as a cornerstone of international economic governance.
ABOUT THE AUTHOR
Anne-Sarah Maleville is an LL.M. Candidate at Georgetown University Law Center and M.IA. at Sciences Po. She is currently an extern at Three Crowns and Founder of The Arbitration Event Tracker.
*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
