What is the investment value of a dispute?
“Global disputes are often overlooked as core balance sheet risks with major financial impacts”, says Matthew McGrath. In a recent article in Westlaw Today he states that the economic aftermath of Covid-19 is a reason to start thinking differently. Can the SCC Express dispute resolution tool catch the eye of shareholders and management teams?
Published 2021-11-01
Time is money, also when it comes to dealing with commercial disputes. This is the main message in a recent article in Westlaw Today by Emissary Partners managing director Matthew McGrath and Donny Surtani of Crown Office Chambers discussing how to use net present value analysis to improve management of complex corporate disputes.
“As the world deals with the economic aftermath of Covid-19, it will be timely and essential to begin to treat disputes as business problems that deserve the same financial rigor and decision optimization as any other risk on the balance sheet”, Matthew McGrath and Donny Surtani writes in the article.
The article pinpoints current challenges in many businesses and a general trend and shift in attitudes that the SCC has reacted to by developing the new dispute resolution tool SCC Express. We therefore reached out to Matthew McGrath to get his view on how SCC Express can benefit the business community at large.
Which companies of today consider the choice of commercial dispute resolution method also through a financial lens?
"Today in 2021, global financial markets are highly attuned to most major elements of value creation for shareholders. And yet, global disputes are often overlooked as a core balance sheet risks with major financial impacts, and thus are an area for more aggressive management. Educated shareholders and management teams are catching onto this new lever for value creation."
What strengths can you see in SCC Express as a new kind of dispute resolution tool?
"In creating SCC Express, the Stockholm Chamber of Commerce has taken the bold step of giving parties to a dispute a high-confidence “estimate” of the probable outcome of an arbitration for just three weeks of time and expense. In round numbers, a client can now obtain an SCC arbitrator opinion at 80%+ confidence in terms of the final outcome, for approximately 12% of the normal time and cost of an arbitration."
Who should use it in your opinion?
"It is hard to see which clients would not want to use this product. Any lawyer, funder or advisor whose incentives are aligned to the client’s financial returns will see the same opportunity."
Read the article in Westlaw Today here
Matthew McGrath is founder and managing director of Emissary Partners, a London-based global advisory firm helping investors manage complex disputes and special situations.