Arctic Diplomacy Act of 2021 This bill establishes the position of Ambassador at Large for Arctic Affairs within the Department of State. The ambassador shall facilitate the development and coordination of U.S. foreign policy and activities related to the Arctic region, including policies and activities to (1) meet U.S. national security needs, (2) protect the environment, (3) increase cooperation among Arctic countries, (4) involve Arctic Indigenous people in relevant decisions, and (5) enhance scientific research and monitoring. Furthermore, the ambassador must establish an Arctic Region Security Policy. The policy must assess and implement plans and actions to (1) bolster U.S. diplomatic presence in Arctic countries, (2) enhance the resilience of Arctic countries to environmental change and increased civilian and military activity in the region, and (3) advance principles of good governance in the region.