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What did King Charles I know about contracts?

January 29, 2019

Tomorrow, January 30th, is an important date in my personal calendar. It is the 370th anniversary of the execution of King Charles I of Great Britain, who fell victim to a fundamental disagreement over scope and obligation management. Many would argue that he also suffered from a lack of negotiation skills. Unfortunately for him, neither he nor his followers were members of IACCM and the records suggest that in any case he would have ignored advice. Ultimately, he paid a heavy price for his failures at dispute management.

What should he have done differently?

The 17th century was a turbulent era, with levels of social discord growing as the economy shifted from largely agrarian to early industrial. Traditional relationships and loyalties became fractured as values altered and new skills came to the fore. As trade expanded, wealth increasingly moved from the land to the merchant classes.

Charles saw it as his duty to maintain many vestiges of the past and was influenced by his belief in the divine right (and duties) of kingship. These led to core concepts around the preservation of power, protection of assets and resistance to change – concepts that resonate with much that is happening today. New forces, driven to a large extent by economic and social interests but dressed up as religious belief, increasingly challenged the scope of a king’s role and the established order. Those forces were often unclear and divided over what they wanted to achieve, but were united by opposition to Charles’ view of his rights and obligations. Eventually, the country split, descending into civil war. Charles chose not to negotiate, essentially stifling efforts to achieve peaceful change. Instead, he insisted on compliance – and lost.

The contract between king and people may not have been in written form, but it existed none the less. Those in positions of power, whether as governments or as large corporations, ignore the fundamental principles of good and fair contracting at their peril. To maintain position and status, there needs to be an underlying consensus over a common purpose and roles and responsibilities in its performance. There need to be effective mechanisms for review and change, with a readiness to make adjustments for altered conditions. King Charles failed to grasp these fundamental elements of contracting and in consequence became seen as a tyrant. His experience provides a critical lesson for those who are charged with developing, negotiating and managing key stakeholder relationships – and even more for the leaders who wish to flourish and survive.

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