The Monsanto Case Study: A Practical Roadmap to Relationship-Based Conflict Resolution Scott Partridge Monsanto Company February 15, 2016 International Institute for Conflict Prevention & Resolution

Agenda: Progressive Steps to A New Model 2 1.Monsanto Case Study: Why an Alternative Approach Was Needed ‒ The environment, developments and new-found motivation 2.A Crossroads: Monsanto’s Decision Point ‒ The beginning of taking a new approach to dispute resolution 3.Lessons Learned ‒ Pragmatic lessons that offer a guide for a new approach 4.Creating a Sustainable Process ‒ How dispute resolution becomes a way of doing business 5.Expanding the Scope ‒ Adapting a relationship-based dispute resolution to broader applications

Motivation 3 ….Investors are troubled by Ag’s litigation and antitrust focus, as they should be – neither is indicative of a healthy business model, or an industry focused on customers and innovation. “ ” Sterne Agee Analyst Report, Jan. 27, 2010

A Practical Catalyst: Monsanto’s Litigation with DuPont 4 August 2, 2012 Monsanto Wins $1 Billion In a Biotech Patent Case DECISION POINT Historically challenging business and negotiation relationship Maintain historical relationship approach? An opportunity for a different approach?

Applied Lessons: What Does a Different Approach Look Like? 5  Legal vs. Business Goals Just because a dispute is in the legal arena doesn’t mean it’s solely a legal issue – solving problems is a business goal  Endorsement from Top A business advocate and decision maker – ideally at the C-Suite level – is a must  Forward-Looking Thought The sooner the organization starts thinking about forward-looking scenarios, the better positioned you are to anticipate a different approach  Settlement is an Option Settlement is historically considered a “weakness” – you have to change your thinking  Relationships Matter Organizations can only build relationships with trust and communication

On March 26, 2013 Monsanto and DuPont announced one of the furthest-reaching and collaborative licensing agreements in the history of the agricultural technology industry A Fresh Start: Thinking About a Relationship-Based Approach 6

Relationship-Based Approach: Principles 7 We can be civil competitors We should deal with each other in a non-contentious manner in public- relations spheres We should avoid litigation if possible Where litigation in unavoidable, don’t elevate the stakes outside the courtroom Underpin all discussion with a group to focus on the relationship to make these principles real CEO endorsement and engagement is critical Monsanto’s Core Principles in Establishing Multi-National Relationships

Relationship-Based Approach: The Process 8 Quarterly face-to-face meetings Evolution of neutral-site locations to routine home-and-home meetings Importance of CEO relationship Relationship Team Composition Process Cadence and Success Factors Business Lead Antitrust Counsel Senior Commercial Lead Senior Technology Lead Adjunct Functions Relationship Ownership Project Exploration Teams Technology/ Regulatory teams Marketing/ Communications

Relationship-Based Approach: The Process 9 Multi-National Relationships Business & Commercial Contracts and Competitive Relationships Product Performance and Misuse Legacy and Inherited Issue Management A Portable Model Monsanto’s initial focus on a relationship-based approach to multi-national relationships has formed a strong nucleus, enabling expansion into important adjacent applications

Example: 10 Business Resolution Common Circumstance: Competitive activity is often “over interpreted,” creating emotion and animus Applying Alternative-Resolution Approach: 1 Business-first conversation (with business lead) 2 Structured dispute resolution and escalation Negotiation Executive Negotiation Mediation 3 “Efficient” arbitration Single Arbitrator Non-Public 4 Intellectual Property disputes First to file dilemma Primary Claim solution

Example: 11 Product Performance Issues Common Circumstance: Poor communication can result in misaligned expectations Applying Alternative-Resolution Approach: 1 Use frontline technology representatives and sales force to identify potential concerns Explore with sincerity and legitimate effort to understand issues 2 Conduct investigation alongside customers 3 Direct engagement in resolution comes before mediation and before arbitration or litigation

Example: 12 Legacy/Inherited Liability Common Circumstance: Embedded hostility and expectation of prolonged fight Applying Alternative-Resolution Approach: 1 Build support in the company for settlement 2 Align inside and outside counsel 3 Ensure the business lead oversees the conversation 4 Establish dialogue and trust 5 Support by the court is beneficial 6 Ensure compensation model is driven by logic and science rather than emotion and avarice 7 Establish agreement on principle-based settlement criteria