MEDIATION AND CORPORATE REPUTATION: HOW CONFLICT RESOLUTION SHAPES STAKEHOLDER TRUST

This article investigates the relationship between mediation and corporate reputation, highlighting the role of conflict resolution processes in shaping stakeholder trust.While litigation is associated with publicity, adversarial confrontation, and reputational risks, mediation offers confidentiality, inclusivity, and cooperative solutions.Drawing on recent research (2023-2025), the paper introduces a conceptual model of the PR dimension of ADR and argues that mediation serves as both a dispute resolution mechanism and a strategic communication tool.By embedding mediation into corporate governance and CSR frameworks, businesses can enhance trust, protect reputational capital, and strengthen long-term competitiveness in global markets.Corporate reputation has emerged as a cornerstone of competitive advantage in the 21st century.It is no longer sufficient for companies to deliver high-quality products or services; they must also demonstrate integrity, fairness, and responsibility in handling conflicts.Disputes are inevitable in business, but the way they are resolved determines whether the company is perceived as trustworthy or adversarial.Litigation, despite its legal authority, carries reputational risks due to public exposure, adversarial dynamics, and negative media coverage.As Batiashvili (2024) notes, firms often underestimate mediation, missing opportunities to preserve relationships and safeguard reputation.By contrast, mediation embodies dialogue and cooperation, attributes that align with the values of corporate governance, CSR, and ESG reporting frameworks.Recent findings suggest that mediation not only ensures efficient conflict resolution but also generates reputational dividends by building trust among stakeholders [Krisdiyanto et al., 2025].This article explores mediation's capacity to function as both a legal and reputational safeguard.Mediation Versus Litigation: Divergent Reputational Outcomes The choice between mediation and litigation has direct reputational consequences.Litigation emphasizes legal victory, often at the cost of relationships.Public court proceedings, adversarial strategies, and prolonged disputes contribute to reputational damage, especially in industries sensitive to stakeholder trust.Mediation, by contrast, protects reputation through confidentiality, informality, and inclusivity.Confidentiality shields companies from negative publicity, while the