NDA is A-OK: Optimisation initiative publishes open-source standardised NDA
August 28, 2021
3 min read
What's going on here?
A group of in-house and private practice lawyers, operating as part of the oneNDA initiative, has published an open-source, standardised non-disclosure agreement.
What does this mean?
The oneNDA initiative was created by Electra Japonas and Roisin Noonan, of the contract optimisation company, tlb (The Law Boutique). The project has attracted the support of giants within the legal and business worlds. It seeks to improve the efficiency and transparency of the legal profession, as well as cutting some of its (perhaps infamously) steep costs. The document was made live in early August and hit its month-end 100-participant target within 12 hours of launch.
What's the big picture effect?
In the commercial world, the non-disclosure agreement is a familiar and essential document. In December 2020, The Law Boutique conducted research analysing documents reviewed for their clients during the preceding year. It found that 63% of their contract review work focused on NDAs, but this only accounted for 7% of revenue. Despite its seemingly straightforward purpose to protect confidential information, NDAs remain a huge part of commercial legal work. Many lawyers are frustrated about the disparity between the costs, and value NDAs add. However, while NDAs have long contained standard clauses such as a concrete definition of “confidential information”, exclusions, time restrictions, and so on, the idea of a truly standard NDA has, until recently, been a myth.
It is not surprising, then, that oneNDA’s open-source offering is widely supported by law firms and clients alike. Smashing initial targets, oneNDA were able to create the document in just five months. The Steering Committee involved in its creation boasts legal frontrunners from the magic circle and other top-ranking UK firms, as well as lucrative companies such as Coca-Cola, PwC and Barclays.
The oneNDA is also hoped to have a positive effect on the profession’s transparency. This is particularly relevant considering the increased scrutiny that has been levelled on the use of NDAs in recent years. The Solicitors Regulation Authority (SRA) has issued a warning notice highlighting concerns over NDAs being used to prevent disclosures that should be protected by law. The Equality and Human Rights Commission singled out the use of NDA “gagging orders” being used to cover up discrimination and harassment in the workplace. The UK Government is also expected to bring forward legislation protecting workers from the misuse of NDAs. OneNDA’s document will hopefully create some much needed transparency with respect to what an NDA should and should not do.
Regardless, NDAs remain an essential, mutually beneficial and legitimate method of protecting commercial interests. The main objective of the oneNDA project is optimising the cost-effectiveness of lawyers and business professionals. Japonas created The Law Boutique because she “desperately wanted to change the way contracts were created, negotiated and managed”, and has seemingly won out against sceptics who believed that achieving agreement within the legal community over a standardised NDA was too great a challenge. Evidently, the oneNDA initiative was only the first step: at the end of 2021, work will begin on developing additional modules that can “stack” upon the foundation document to expand its applicability, starting with an “M&A module”. Co-founders Japonas and Noonan hope that the idea can grow to the point where a lawyer could “just pull from a list of pre-agreed, non-negotiable standard modules”.
Document standardisation is a familiar concept in the legal profession. Many firms store precedents for certain transaction types, and part of oneNDA’s raison d’être was the fact that complex agreements like the International Swaps and Derivatives Association (ISDA) Master Agreement have been standardised. However, in the age of unprecedented legal tech growth, it is also expected that law firms operate at the cutting-edge for their clients, offering that something extra that competitors do not. As NDAs are the sort of “boilerplate” documents that would not typically vary a great deal client-to-client, it is unlikely that the standardised NDA will affect a law firm’s goal to set itself apart. However, it remains to be seen to what extent the wider profession, whose defining characteristic is its client-first eagerness to innovate, will get behind standardisation of the scale that oneNDA’s creators envision.
Report written by Laura Wiles
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