This is Allens

This year the world has become increasingly complex and polarised; trends that are mirrored in the challenges we now face in commercial litigation. Greater complexity and increasing intractability has been the common thread across my work in 2023 – a shift that is driven by opposing values, an uncertain regulatory environment and divergent perceptions of risk and reward in litigation.

On a personal level, I'm concerned by the social and political polarisation we have experienced this year as the country has grappled with rising interest rates, cost of living pressures, social unrest and geopolitical instability. This dynamic is also impacting litigation. Parties are less likely to be driven solely by commercial demands and increasingly likely to take principled or value positions, and this can make paths to settlement more challenging. Growing Environmental, Social and Governance (ESG) litigation exemplifies this trend, where the demands of one party can seem irreconcilable with the needs of the other. I'm also seeing the misalignment of corporate values causing business relationships to breakdown – for example, where joint venture partners maintain starkly different positions on climate transition. Identifying the root cause of a dispute (or potential dispute) early and building your strategy with that in mind is critical to navigating values-based disagreements effectively.

Then there's the regulatory angle. Ever-evolving (and at an increasing pace), the regulatory landscape has added an extra dimension of difficulty to the daily hurdles faced by organisations. In scenarios where regulatory ambiguity intersects with commercial disputes, my clients have been faced with a balancing act when formulating their position and considering settlement options. As just one example, disputes that cross over with the largely untested and evolving regulation of corporate crime require careful navigation and foresight. Equipping clients to make informed decisions in these situations often involves strategising multiple scenarios and thinking creatively about available options.

These tensions are playing out against a backdrop of economic volatility and uncertainty. In the same way that we have seen wildly variable asset valuations in the mergers and acquisitions space in 2023, economic conditions have also affected perceptions of value when it comes to commencing and settling disputes. These disputes only resolve when you can effectively shift the value proposition – a feat that requires a concerted effort to leverage knowledge and relationships across the business.

In today's world, finding common ground, navigating regulatory uncertainty and influencing the opposing party's perception of value requires a bird's-eye view and a creative mindset.

To achieve this, we're collaborating with colleagues across the firm more than ever before on potential transactions, litigation strategy and more. We're asking: What possible challenges might this raise? How can our clients be best prepared to meet them? And what creative options are available to find a way through a roadblock? 

Traditionally litigators are brought in when a dispute is on the doorstep. However, I continue to see more and more dispute resolution risk advice forming a prominent part of strategic commercial decision making. Working with other subject matter experts, it ensures that our clients are truly focused on looking around corners, rather than just reacting and defending, so that they stay on the right path.