Organisations need to improve the way they manage disputes, according to research from law firm Nabarro.

The study suggests that many organisations do not have effective procedures and training in place to prevent disputes from arising or escalating.

It found that while risk management has taken off as a discipline in recent years with the majority (78%) of companies now having a risk management policy in place, only one third of these policies cover dispute resolution. This is despite the fact that commercial disputes cost UK PLC an estimated £33billion each year.

The research found that only 30% of companies update their policies in the light of lessons learnt from disputes, only 51% of companies have training programmes focused on dispute avoidance and management for senior managers and only 38% train other staff in this area.

Susan Gordon, employment dispute resolution partner at Nabarro, says: “Disputes, in one form or another, are inevitable. It is therefore important to have an effective risk management policy in place to protect your organisation and employees. This should include clear, practical dispute management procedures, and comprehensive training for employees. Not only should this help to minimise the risk of disputes arising, but it should also provide a framework for dealing with them when they do occur.”

The study found that 34% off all dispute are with customers, followed by employees (21%) and suppliers (15%).