Conflict Resolution|systems design

CPR's 21st Century Corporate ADR Pledge

On January 22, 2013, CPR Institute issued a press release announcing the promulgation of the “21st Century Corporate ADR Pledge.”  The Pledge provides for signitories “to commit its resources to manage and resolve disputes through negotiation, mediation and other ADR processes when appropriate, with a view to establishing and practicing global, sustainable dispute management and resolution processes.”

The original CPR Corporate Policy Statement for Alternatives to Litigation was a commitment to investigate ADR options in the context of an individual dispute between signatories.  By contrast, this new Pledge “seeks to change the way the world resolves conflict by moving away from case-by-case resolution towards a sustainable system-based process for greater efficiency and improved quality.”

For many of us, the CPR Pledge was a signal event in the take-up of corporate ADR.  It indicated to the world that many hundreds of major companies, on their own behalfs and on behalf of their thousands of operating companies, knew what mediation was and viewed it as a tool in their toolkit.  Quiate an event in the 1990s.  It was at that time an extraordinary leap forward in the credibility of ADR as a viable method of managing business-to-business disputes.

To some degree, that lion has been tamed.  Businesses may have varying views of the efficacy and universal applicability of business mediation, but most American companies know what it is.  What is the strategic aim of this new Pledge?

Strategic Marketing Plan

Well, for one thing, signatories assert their belief that they “can and should engage in a systematic and collaborative approach to dispute management and resolution with domestic and global customers, suppliers, partners and competitors” and that “law firms schooled in ADR can better serve our legal needs.”

Let’s parse that one out.  First, a company adopting this Pledge views disputes as things that are subject to “management and resolution,” not as instances of contract breach or triggers for litigation to seek legal remedies.  Second, the scope of disputes at issue ia on a global scale, acknowledging that business relationships, not legal jurisdiction, is the defining coompass to their concerns.  Third, the disputes they are discussing involve not just those within the company or between it and its contracting counterparties, but also with its partners and its competitors.  Finally, the statement gives very clear notice that the signing company will seek outside counsel that are competent in rendering ADR counseling and service. 

These undertakings are significant and, assuming that the initial signitories provoke others to join them, and that these undertakings are taken seriously, could be tectonic in their consequences.  This is not just “getting the other side to the table.”  It is changing the way contingenties are acknowledged and managed by the leading economic forces in the world.

And the initial signitories ain’t chopped liver.  The first 25 include some familiar CPR names and some very welcome new ones: AEGIS Insurance, Akzo Nobel, Amgen, BP, ConocoPhillips, Danaher, DuPont, Flour, FMC, GE, GlaxoSmithKline, IBM, Johnson & Johnson, Microsoft, Northeast Utilities, Pepsico, Pfizer, Royal Dutch Shell,Teradata and Walgreen.

CPR founder Jim Henry once told me about farmers not being too concerned about leading an entire herd of cows to the barn — they would lead the one with the bell, and everybody else would follow.  Looks like we have 25 bell cows here.  Hope the barn is a big one!

stock photo : Cattle with Cow

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