Unruly Participants During Board Meeting

Dealing with Difficult Situations and Unruly Participants During Board Meeting

Corporate conflicts during board meetings have a detrimental effect on business, leading to loss of control over society’s activities and financial collapse. This article will explain the best ways to deal with difficult situations and unruly participants during such business events.

Corporate disputes: how not to turn from partners into enemies

Conflicts arising within a company between its founders and shareholders are always of great difficulty. It is good if the parties can find a mutually beneficial solution, but this happens in rare cases. Much more often, corporate disputes are resolved in court.

Due to the clash of opposing interests of owners, management, participants, and shareholders, the company and its representatives may suffer damage expressed in direct financial losses, lost profits, and damage to business reputation. Both commercial and non-commercial corporate organizations often face the problem of corporate conflicts.

Corporate conflicts and difficult situations do not arise from scratch. Any conflict is a phenomenon that disorganizes the company, leading to increased uncertainty and often hindering constructive development. Such conflicts are often based on contradictions in the management and distribution of assets and funds. It arises based on a conflict of interests, the correct solution determining the comfort of your work in the organization and the possibility of career growth.

Skills and techniques for the board’s dispute resolution

Dispute resolution techniques borrowed from negotiation and mediation can help create a welcoming board environment that encourages discussion, debate, and the free exchange of ideas. These techniques can also help facilitate decision-making and consensus-building on specific issues that the board of directors is considering. In turn, this increases the efficiency of the board of directors in all respects.

It is usually assumed that the chairman will be an intermediary between the disputing directors since they are especially attuned to relations with the board of directors. But sometimes, other directors with a partner style of conflict management may resort to mediation techniques to find common ground with opponents. Such peacekeepers will ask questions, listen carefully and encourage parties to resolve differences. Ultimately, the board has a collective responsibility to resolve disputes promptly and constructively. Thus, all directors should be able to improve corporate governance on the board through dispute resolution practices.

Throughout the dispute cycle, certain interpersonal skills and experience can help board directors deal constructively with each other and manage tension. The most widespread techniques are:

  • effective communication,
  • respect for cultural characteristics,
  • consensus building,
  • emotion management
  • constructive disagreement.

In addition, it is an effective practice to develop policies – internal corporate documents of the company that would regulate the main issues of corporate relations in the company.

The advantages of alternative dispute resolution

Alternative dispute resolution during board meetings is a system of voluntary and amicable procedures designed to resolve corporate governance disputes more quickly and at a lower cost than traditional litigation. 

When it comes to corporate governance, the question is divided into two parts: which policy is appropriate for internal disputes and which for external ones. Can the same approach apply in both cases? While the board may be involved in both categories of disputes, it may determine that external disputes should be handled differently from internal ones for commercial or tactical reasons. 

Mediation provides an opportunity to restart and sometimes start negotiations to arrive at solutions that reflect interests rather than positions and to implement agreements and monitor the progress of their implementation.

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