UK risk managers have been warned that their businesses are at threat if they fail to assess disputes properly to minimise the damage to brands and reputations.
International law firm DLA issued the warning after surveying the UK's largest 500 organisations.
Only 4% of the UK's largest companies had not faced some form of dispute in the past two years and that there was a widespread expectation that levels of disputes will continue to rise.
Net increases in the number of future disputes are predicted to come from entities such as pressure groups, followed by employees, the general public, industry regulators, suppliers, competitors and business customers or clients.
DLA Insurance partner Charles Gordon said: "Perhaps one of the key risk management issues that the survey highlighted was the absence of any consistency among businesses in either planning to avoid (or, at least, reduce) disputes or in handling them," Gordon said.
"What is more, it also pointed out that once a dispute has arisen, businesses appear to rarely have policies for an early risk management analysis; for escalation and reporting; or for the process of determining at what point (if at all) the board should be involved in a dispute."
The survey also found that the percentage of litigated disputes that go to trial is high with respondents estimating that in cases where litigation is used, 21% end up in court rather than being settled through mediation or beforehand.