In the wake of the Treaty of Novigrad and the cementing of centralized control over Earth, the members of the former Mythic Avengers took stock of their situation. The New Earth Government and S.H.I.E.L.D. had dismantled the old order, raising up new legal and policing institutions. Included in this was former-American Senator Joseph Keene's systematic closing of the legal loopholes which had allowed superheroes to operate as law enforcement individuals adjacent to conventional police.
And though liaison Monica Rambeau swore that Earth had no intention of extending its dominion to Outland, Kentauride was not convinced.
After rescuing former S.H.I.E.L.D. director Nick Fury from protective custody, Kentauride began a political movement in order to counter the N.E.G. Gathering together Atlantis, Khandaq, Krakoa, and Thermyscira, they held a hastily-arranged conference in Outland, they hashed out an agreement in which Outland lent its extra-dimensional authority (and legality) to their nations, officially making them not a part of the Earth government.
The Sword Treaty was largely a mutual defense pact and did not impose any limitations on the political systems in place in the nations. The Mythic Avengers had no aspirations of creating an Empire, only keeping their friends safe. King Orin, Black Adam, Queen Diana, the Quiet Council, and Regent Kentauride would continue to control their nations without interference.
As a provision of the Treaty was the symbolic creation of the shared-security organization to counteract the influence of S.H.I.E.L.D. Dubbed the Sentient Worlds Observation and Response Division (or S.W.O.R.D.), this group would provide intelligence and if necessary, military assistance to whatever treaty nation required it.