International arbitration needs to become more diverse as a matter of fairness and legitimacy, according to leading lawyers in Portugal.
“As society, parties and law firms become more diverse, it will be even stranger and more unacceptable to have tribunals that are not diverse,” Raquel Galvão Silva, counsel at Linklaters in Lisbon, said Sept. 8 during an event held to discuss diversity and inclusion in international arbitration.
The event, believed to be the first of its kind in Portugal, was hosted by Portuguese law firm Morais Leitão in Lisbon and covered the areas of diversity and disability inclusion. ICC International Court of Arbitration president Claudia Salomon, the first female president in the court’s near-100-year history, joined remotely for an interview that preceded a panel discussion with London- and Lisbon-based lawyers.
The event organizer, Joana Granadeiro, Iberian Peninsula representative to the ICC’s Young Arbitration & ADR Forum, told Law.com International that diversity is a matter of justice, and the issue of diversity in the composition of the arbitral tribunal is an issue of legitimacy.
“There is this idea that if the tribunal is to render a decision that is going to be enforceable … it has to be rendered by a panel that is representative of the community to which it is addressed,” Granadeiro, principal associate at Morais Leitão, said in an interview.
In the area of gender diversity, international arbitration has seen improvements in recent years. In 2020, 23.4% of people sitting in ICC arbitral tribunals were female, which is more than double the percentage in 2015 (10.4%), when the Equal Representation in Arbitration (ERA) Pledge was launched.
Though the overall number of female representation has increased, discrepancies remain.
Salomon noted that a full 75% of all the arbitrators appointed in ICC arbitration cases are either nominated by the parties as co-arbitrators or selected by the co-arbitrators as president of the tribunal or sole arbitrator.
Therein lies a discrepancy: of arbitrators appointed by the ICC, 30% are female, Granadeiro explained during the event, but the percentage of female arbitrators appointed directly by the parties is a mere 16%.
“[The ICC] can do a huge amount,” Salomon said. “But if we’re going to see a huge shift in the number of women appointed and then just more diverse arbitrators generally, we have to see a real shift in the diversity of nominations by the parties.”
Isabel San Martin, associate at Lalive in London and member of the ERA Pledge Young Practitioners Subcommittee, said one of the main positive aspects of arbitration is the fact that you can choose your arbitrators. That should remain as is, she said, and quotas should not be imposed. Instead, the goal should be to broaden the pool of arbitrators, she added.
Considering a full range of arbitrators will require effort from not only in-house counsel but also outside law firms, Salomon said. The former co-head of global arbitration at Latham & Watkins and DLA Piper also questioned the way in which the “right person for the job” is assessed; perhaps it should not simply be favoring the arbitrator with 25 appointments over the arbitrator with two.
In Portugal, Galvão Silva has seen more women appointed as arbitrators and as counsel on legal teams, as well as an increase in age diversity in arbitration, but not as much progress in the area of ethnic and cultural diversity.
One of the ICC initiatives launched under Salomon is the “Hold the Door Open” scholars initiative, which allows young arbitrators—the first group of scholars are from 14 African countries—the opportunity to observe hearings.
The initiative falls in line with a general mindset described by the lawyers during the event: opportunity and experience lead to visibility, and visibility expands the pool of arbitrators, ultimately increasing diversity in arbitration.
Another newly launched initiative is the ICC’s Task Force on Disability Inclusion and International Arbitration; the first effort of its kind by an arbitral institution.
Salomon’s push for disability inclusion is driven by her experience working on a case with an associate with Type 1 diabetes, who had to run out of a lengthy hearing after successfully cross-examining a witness for the first time.
“To this day, I regret what happened because had I only, at the beginning of the hearing, said to the arbitrators that we might need to take a break … then I would’ve shifted the burden from this associate, who was so worried about getting this opportunity to advance his career, and the burden would’ve been on the institution, on the arbitrators,” Salomon said.
The task force is addressing the issue head-on.
Simon Maynard, senior associate at King & Spalding in London and co-chair of the task force on disability inclusion, told Law.com International it is highly likely the task force will recommend in its first report to be published in 2023 the inclusion of wording in the ICC’s procedures so that there is a way to address necessary reasonable adjustments at the beginning of the arbitral process.
Maynard, who was diagnosed with bowel disease at the age of 19 and bowel cancer in November 2019, talked about why he was not open about his disability prior to his cancer diagnosis: “All of the areas in which I was looking to build my professional life didn’t have any disability representation whatsoever. So I didn’t see disability in the city—in London, where I work and live—I didn’t see disability in the law and I certainly didn’t see disability in international arbitration and for the most part, in fact, I still don’t.”
Today, diversity is unquestionably a public principle, Galvão Silva said during the event. Still, there remains a strong call for diversity in international arbitration, and the fact that this event was the first of its kind in Portugal deserves reflection, she said.
Granadeiro listed a few reasons why she thinks the event was a first: the topic is difficult to discuss; the issue in Portugal now reveals itself more as unconscious bias; and, Portugal is a relatively conservative society and law is a relatively conservative profession that is slow to adhere to change.
Going forward, Galvão Silva wants to see more studies and statistics around diversity in Portugal in order to better understand the country’s reality, as well as continued discussion following last week’s event.