Corporate Social Responsibility (IVOR nr. 77) 2010/1.9:1.9 Dispute resolution: mediation versus litigation

Corporate Social Responsibility (IVOR nr. 77) 2010/1.9

1.9 Dispute resolution: mediation versus litigation

Documentgegevens:

Mr. T.E. Lambooy, datum 17-11-2010

Datum: 17-11-2010
Auteur: Mr. T.E. Lambooy
JCDI: JCDI:ADS363397:1
Vakgebied(en): Ondernemingsrecht (V)

Business disputes are solved in different ways: terminating a business relationship, finding a solution in a consultation process, engaging in a mediation process, and fighting the dispute in court. CSR conflicts often attract wide media coverage due to public campaigns organised by NGOs or campaigning organisations. Resolving CSR conflicts is a new challenge. Gradually, companies and civil society have discovered the option of consulting each other on CSR issues. In first instance, consultation took place as an ex post approach to find a solution for claims of civil society that a company had acted irresponsibly. Today, consultation also takes place in an ex ante phase. A consultation process such as the one engaged in by Unilever and WNF concerning the subject of the depletion of fish stocks, frequently ends in a joint new initiative, e.g. the development of a certification process or the adoption of a new code of conduct. Consultation has even been institutionalised in various certification schemes, industry codes of conduct, and auditing methodologies.1 Mediation is an accepted and respected approach therein. A prime example is the mediation offered by 'National Contact Points', set up in OECD countries pursuant to the OECD MNE Guidelines.2

Litigation against Shell that commenced after the execution of the Nigerian activist Ken Saro Wiwa in 1995 did not trigger change for a long time nor did it generate positive results for the Ogoni people in Nigeria. In 2009, however, one major case was settled and the Nigerian claimants contributed part of the settlement's funds to a foundation to assist the Ogoni people with education and employment.3 It had taken at least one and a half decades before these concrete results could be achieved. And still, many disputes concerning environmental pollution in the region are being litigated in court.4 One could ask oneself which would be the better way of solving these disputes with civil society: litigation which addresses the legal positions in the past or mediation which takes into account the various stakeholders' interests with an outlook for the future? Chapters 9 and 10 elaborate on this question, pointing out that CSR encourages companies to use alternative dispute settlement methods such as mediation.5

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See also: Social Accounting 8000, International Standard 2008, under 9.14, at: http://www.saintl.org/_data/n_0001/resources/live/2008StdEnglishFinal.pdf, accessed on 4 June 2010.

An NCP's primary responsibility is to promote the follow-up of the Guidelines in a national context and to ensure that the Guidelines are well known and understood by the national business community and other interested parties. NCPs also deal with ' specific instances', the term used for complaints. See: http://www.oecd.org/searchResult/0,3400, en_2649_34889_1_1_1_1_1,00.html, accessed on 4 June 2010.

Shell paid USD 15 million to the plaintiffs. The plaintiffs set up a trust for the benefit ofthe Ogoni people. The Settlement Agreement and Mutual Release and the Kiisi Trust Deed, all dated on 8 June 2009, can be accessed, at http://wiwavshell.org/documents/Wiwa_v_Shell_agreements_and_orders.pdf, visited on 10 May 2010.

E.g. Milieudefensie, The people of Nigeria versus Shell, tort case before a Dutch court. Case documents available at: http://www1.milieudefensie.nl/english/shell/documents-shell-courtcase, visited on 24 June 2010.

See for a discussion on the various options for the enforcement of CSR: T.E. Lambooy, Conference Report, HiiL Law of the Future 2009 Conference, ' Globalisation, the Nation-State and Private Actors: Rethinking Public-Private Cooperation in Shaping Law and Governance', (The Hague, 8 and 9 October 2009), in particular ' Workshop III - Enforcement of Corporate Social Responsibility Standards', pp. 27-33, available at www.hill.org, accessed on 24 June 2010. See also C. Rees, Mediation in Business-Related Human Rights Disputes: Objections, Opportunities and Challenges', Corporate Social Responsibility Initiative Working Paper No. 56, John F. Kennedy School of Government, Harvard University: Cambridge, MA 2010, at: http://www.hks.harvard.edu/m-rcbg/CSRI/publications/workingpaper_56_rees.pdf, accessed on 24 June 2010. See on the mediation of business conflicts: A.J.A.J. Eijsbouts and M.A. Schonewille, ' Zakelijke mediation' [business mediation], in: A.F.M. Brenninkmei-jer, K. van Oyen, H.C.M. Prein, P. Walters, Handboek mediation [handbook on mediation], (SDU: The Hague, 2001), p. 348.