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Social media platforms such as YouTube, Twitter, Facebook, MySpace, LinkedIn and Google+, the instant messaging and camera applications of cell phones are profoundly changing our world. A new culture encouraging collaborative and sustainable dispute resolution is sure to follow.
In China a senior aide to the President of the Communist Party resigns after a grainy photograph of his son’s wrecked Ferrari surfaces on social media. In South Africa social media users pressurise a multi-billion rand company to discontinue selling a product it had apparently copied. And as the balance of power and influence shifts from the powerful few to a majority that can no longer be silenced, changes are afoot that were unimaginable only 5 years ago.
Successful companies of the future will have recognised how fast adverse information – fuelled by outrage – travels exponentially across vast networks of online communities. Outrage is a one of the most powerful of human emotions. Companies’ success will depend on being tuned into the brave new world of social media, able to detect the first signs of outrage and quick to respond appropriately.
They will be good corporate citizens and keep their side of the street clean in their relationships with stakeholders. They will resist the temptation to venture to court, and their attorneys will understand that the court of public opinion, driven by outrage can sometimes be more powerful and influential than a court of law.
Stakeholder means a person, group, organization, member or system that is affected or can be affected by a company's operations or actions.
Enter Frankies Olde Soft Drink saga for an important lesson on how not to do business in the era of social media.
After Woolworths apparently copied the product of Frankies, a much smaller business, social media users bunkered behind their computers to teach Woolworths three valuable lessons. Firstly not to underestimate the power of empathy and social media to rally against unethical conduct, secondly to become more ethical and thirdly to find a more nuanced and collaborative style to resolve disputes with stakeholders.
The Advertising Standards Authority has ruled that Woolworths intentionally copied the product line of Frankies. Woolworths is not appealing the ruling and under pressure from social media discontinued sale of its own vintage style soft drinks. Wisely acknowledging the power of social media, Woolworths’ CEO told eNews: “Public opinion is so much against us and, whether we’re right or whether we’re wrong, customer opinion is against us.”
South African companies will know that the new Companies Act offers some protection against legal action by shareholders who allege that their companies made decisions which are fair to stakeholders but at their shareholders’ expense. The shift of emphasis from shareholders to stakeholders’ interests is seismic in company law terms and has opened the door for companies to introduce a stronger ethical dimension to their stakeholder relationships.
Social media may however be the game changer, leaving companies little choice but to treat their stakeholders ethically, including other smaller companies. It will in future also be more difficult to hide behind the best interests of shareholders’ doctrine. Honesty and fairness in stakeholder relationships may thus become the aspiring values of companies who wish to be winners in the brave new world of social media.
Successful companies of the future will apply the King III principle in favour of mediation when direct negotiations with stakeholders, including customers stutter or reach an impasse. They will expect their attorneys to find nuanced and collaborative solutions for disputes. Mediation is geared towards overcoming barriers to settlements that are often encountered during direct negotiations. Barriers such as the inability to communicate, refusal to share relevant information, unrealistic expectations and the absence of imaginative and practical problem solving come to mind.
Companies will find comfort in the private and confidential nature of mediation, and the awareness that mediation preserves relationships, while litigation destroys relationships. In an era of social media, mediation should be an integral part of their comprehensive strategies to protect brands and reputations. In Cape Town a group of lawyers have formed the Association of Independent Mediators (AIM) to provide mediation services to the corporate and legal sector. (www.aim.co.za)
A cultural shift in dispute settlement is taking place in the legal profession, a shift that is necessary to accommodate the increasing impact of social media. In her book, The New Lawyer (2009) Julie Macfarlane writes: “The most successful lawyers of the next century will be practical problem solvers, creative and strategic thinkers, excellent communicators, who are persuasive and skilful negotiators, thoroughly prepared advocates for good settlements, who are able and willing to work in a new type of professional partnership with their clients, and aware of the need to constantly update their knowledge of conflict management processes and techniques as well as substantive law.”
Local lawyer, Amanda Boardman who is launching the Centre for Integrative Law (CIL) in Cape Town says: “an integrative approach to law involves a mind shift towards understanding that a legal system is a fluid and dynamic system, inextricably woven into the fabric of the society it is expected to contain.”
She goes on to explain that, “The world is in a state of flux. In every industry people are realising that past models are insufficient to prepare us for an unknown future. Lawyers and law firms need to start shifting consciously from a rigid, hierarchical, right brain, win/lose mind-set to a more intuitive, inclusive and interconnected worldview. These shifts will not only change the perception of the legal profession in the public eye but will also allow lawyers to fulfil their clients’ needs in a more authentic way. All over the world new legal practices and processes are arising in response to these issues.”
The Centre’s mission is to create a network of conscious committed legal professionals, trained in global legal innovation, to articulate a new vision of law for South Africa. The CIL will be first to introduce training in collaborative law, conscious contracting, appreciative inquiry, non-violent communication and mindfulness, for lawyers in South Africa. Mindfulness for lawyers is now being taught at several US law schools and lawyers in the US are increasingly using this technique to become the practical problem solvers, creative and strategic thinkers MacFarlane writes about. For more information about the Centre, visit www.cil.org.za.
It is perhaps a great paradox that technology and social media in particular may help restore Ubuntu, the African ethic of empathy, expressed in the words:Umuntu ngumuntu ngabantu. A person is a person through other persons.
Nelson Mandela defines Ubuntu with the question: how do you improve yourself in order to enable the community (stakeholders) around you to be able to improve?Bishop Tutu says: “a person with Ubuntu is open and available to others, affirming of others, does not feel threatened that others are able and good, based from a proper self-assurance that comes from knowing that he or she belongs in a greater whole and is diminished when others are humiliated or diminished, when others are tortured or oppressed.”
Jacques Joubert is a practicing mediator and independent mediation analyst in South Africa He practiced law in South Africa and Canada, but now specializes in alternative dispute resolution.
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