New Decade, New Demographic? Increasing Diversity in International Arbitration

Middle Eastern and African countries are no strangers to arbitration. The International Centre for Settlement of Investment Disputes (ICSID) published in its 2020 Caseload Statistics showing that the Middle East, North Africa, and Sub-Saharan Africa together account for 26% of all cases. In its 2017 Special Focus on Africa Report, ICSID reported that 22% of the cases registered under the ICSID Convention and Additional Faculty Rules involved African parties. The Kluwer Arbitration Blog published a 2018 Year In Review focused on the Middle East and a 2019 Year In Review focused on North Africa. Both demonstrated the growing use of international arbitration in the regions. The 2019 Review points to new arbitration hubs in North Africa, and names well respected and established North African arbitration centers like Cairo Regional Centre for International Commercial Arbitration (CRCICA) and the International Court of Maritime and Air Arbitration (CIAMA). The 2018 review provided recaps of the first International Chamber of Commerce (ICC) Kuwait Arbitration Day, the United Arab Emirates Penal Code Reform and arbitral law developments, and enforcement of an Arbitral Award in Saudi Arabia while providing commentary on additional developments in the region.

Despite the increase of arbitration proceedings emanating from the Middle East and African regions, there has been minimal growth in the ethnic diversity of arbitrators appointed to resolve these disputes. For example, of the 221 Arab parties involved in ICC cases in 2015, only 54 Arab arbitrators were appointed. The issue of diversity is not only seen in statistics, but it is also felt by practitioners and users of arbitration alike. Bryan Cave Leighton Paisner (BCL) conducted an international arbitration survey in 2016 that explored a variety of questions about diversity in international arbitration. They asked arbitrators, corporate counsel, external lawyers, parties to arbitration, and those working at arbitral institutions for their views. The respondents represented voices from Asia, Australasia, the Middle East, North Africa, North America, Latin America, the Caribbean, Western and Eastern Europe, East and West Africa, and the BVI/Cayman and Bermuda. BCL found that 84% of respondents thought there were too many men, and 80% thought tribunals contained too many white arbitrators (64% saying they felt there were too many arbitrators from Western Europe or North America). While 93% of respondents agreed that a candidate’s expertise was “very important” or “important,” 54% also said that it was desirable that those expert tribunal appointees come from diverse range of ethnic and national backgrounds. BCL concluded the report by showing that 70% thought it was desirable for diversity statistics to be published, with 28% expressing that the content of the statistics would influence their choice of arbitrators in the future. This data also suggested that the majority of the respondents believe that changes in increased diversity is the responsibility of everyone involved (arbitral institutions, counsel for the parties, arbitrators, etc.).

In her November 2019 article titled Too Few Of Africa’s Commercial Disputes Are Resolved By African Arbitrators – Why This Must Change, Emilia Onyema addresses the biases and poor perceptions she credits for the disparity. The African lawyers she surveyed for the article “blame poor perception of African arbitration practitioners by their foreign colleagues, bias by those appointing arbitrators in favor of foreign counsel, and the fact that Africans were not appointing fellow Africans as arbitrators.” During Funke Adekoya’s Keynote address at the 2008 Conference on Energy Arbitration and Dispute, she asked whether it matters “if the vast majority of arbitrators appointed are from one major racial group?” To summarize her answer, yes, it does matter. Adekoya says the lack of diversity may directly affect the quality of arbitration awards and quotes BCL report stating that “the deliberative process before the arbitral tribunal is likely to be crucial and, therefore, the diversity of views may be fundamental for a fair process and outcome.” She argues that increased diversity will result in the continued acceptability and legitimacy of the arbitration process, hinting that the opposite might also be true.

For those interested in breaking the cycle, Arbitration in Africa has published information on qualified arbitration institutes in Africa. Centers like Cairo Regional Centre for International Commercial Arbitration (CRCICA), the International Court of Maritime and Air Arbitration (CIAMA) and Casablanca International Mediation and Arbitration Center (CIMAC) are at the forefront of change. To understand how they play a key role, just look at the principles they were founded on. For example, CIMAC claims to be the first arbitration center on the African continent with a truly international and independent governing body. CIMAC’s diverse court embodies the diversity and inclusion lacking in the field. The court includes Moroccans, Africans, Arabs, Europeans, Americans, French, English, Arabic, and Spanish native speakers; and both common law and civil law lawyers. The members of the court are internationally recognized as independent specialists. With the presence of CIMAC, CRCICA, CIAMA and a long list of other African and Middle Eastern courts, firms, and arbitrators, there is no excuse for continued exclusionary practices in appointments. The data shows that the majority of the international arbitration community is calling for change, and it is clear the solutions are not only available but also attractive.

By Nadia Bouajila, Junior Staffer

Sources:

The Arbitration Brief

New Decade, New Demographic? Increasing Diversity in International Arbitration

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