Secret Agent Man: Should You Keep Your Deal Private?

By on / Negotiation Skills

President Obama recently surprised the world with the outcomes of three high-profile negotiations. We look at the pros and cons of a clandestine approach.

In Washington, D.C., press leaks and rumors are practically the local currency. Secrets frequently explode into the public eye, and key negotiations sometimes seem to unfold on parallel tracks—in the media and behind closed doors.

All the more surprising, then, that during his second term in office, President Barack Obama and his administration managed to keep three major negotiations under wraps until the i’s were dotted and the t’s were crossed on the final agreements:

– In November 2013, the United States and five other world powers announced a landmark accord to temporarily freeze Iran’s nuclear program and forge a broader long-term agreement. The accord was largely the result of top-secret talks between American and Iranian officials.

– China and the United States—the world’s two largest polluters—revealed in November 2014 that over the course of the previous nine months, they’d secretly negotiated bilateral commitments aimed at slowing global climate change.

– In December 2014, the Obama administration announced that it had reached a deal with Cuba to open negotiations aimed at restoring full diplomatic relations. The deal hinged on the quietly negotiated release of an American contractor held in Cuba for five years.

Negotiations aren’t always interesting or relevant enough to outsiders to warrant the type of cloak-and-dagger precautions taken by the White House. But when they are, an understanding of how the Obama administration maneuvered in this delicate terrain may help your organization secure privacy for its most sensitive talks. We offer three guidelines: (1) weigh the benefits of secrecy against those of transparency, (2) negotiate the terms of secrecy agreements, and (3) implement control and discipline.

1. Weigh secrecy against transparency. 

Before taking steps to conceal a planned negotiation, you should consider your motivation and the potential risks. Obviously, concealing negotiations because they are ethically and legally questionable is always a mistake. If you have qualms about how a negotiation could affect outsiders, consult your conscience and, perhaps, your organization’s lawyers.

Keeping interested outsiders apprised of your progress in a sensitive negotiation can be beneficial. For example, to show transparency, a town government might be wise to keep community members in the loop as it negotiates with a company over a proposed development project. Though interested observers don’t have to be educated about every twist and turn in the negotiation process, a carefully timed tweet, joint press release, or community meeting can tamp down public suspicion of negotiators’ motives and allow the parties to incorporate useful feedback before it’s too late.

“Negotiations are like mushrooms: They grow in the dark.

On the other hand, a communications blackout may be desirable for legitimate reasons, as when a negotiation could reveal trade secrets or privileged financial information; merger discussions are often shrouded in secrecy for these reasons. If your counterpart, marketplace competitors, or other adversaries could benefit from knowledge related to a potential agreement, you have reason to keep talks under wraps.

Political and business leaders alike sometimes choose to conduct high-risk negotiations in secret to avoid the possibility of a public failure. Given the long-standing U.S. embargo against Cuba, for example, revealing Obama’s interest in reaching out to the Castro regime would have set the White House up for harsh criticism if any leaks emerged or the talks collapsed in the public eye. Similarly, observers might look askance at a company that suffers a humiliating negotiation defeat or impasse.

“Negotiations are like mushrooms: They grow in the dark,” the Brookings Institute’s director of foreign policy, Martin S. Indyk, told Mark Landler for a December New York Times article on Obama’s secret deals. “That’s especially true of negotiations between longtime adversaries, where the domestic politics on both sides make it impossible to reach a deal if the negotiations are conducted in public.” Indyk would know: On behalf of the Obama administration, he led highly scrutinized Israeli-Palestinian negotiations that failed in 2014.

2. Negotiate the terms of secrecy.

Because you’ll never be able to keep a complex negotiation quiet on your own, you will need to convince your counterpart of the benefits of doing so, if she doesn’t see them already. Include the topic on your list of issues for prenegotiation discussion. Before substantive talks begin, negotiate who will be involved, where they will meet, and the type of information they will share. If the other side doesn’t see the need for secrecy, you might offer enticements for their cooperation, or you might convey the value you place on the issue by making privacy a precondition to negotiation. If the other party doesn’t seem to be taking your concerns seriously, you may want to find another negotiating partner.

A “no leaks” pact could be informal (sealed with a handshake) if trust is strong between parties; alternatively, your lawyers could draft a binding agreement. Companies often negotiate official nondisclosure agreements when one or both will be sharing confidential information with the other, for instance.

3. Implement control and discipline.

In particularly sensitive environments, simply agreeing to keep negotiations quiet may be insufficient to ensure privacy. If the press, your competitors, or others are actively following your every move, added precautions may be needed.

One strategy that Obama used to throw observers off the track in two of his recent top-secret negotiations was to use very small teams of unlikely negotiators. An administration official told Landler of
the Times that assigning nondiplomats to lead sensitive negotiators helps protect secrecy because colleagues are unlikely to suspect their involvement.

After multiparty talks over Iran’s nuclear program failed in late 2011, for example, then U.S. secretary of state Hillary Clinton asked a relatively low-level aide, Jake Sullivan, to initiate secret back-channel contact with Iranian officials. Sullivan traveled to Oman, where he and a colleague “crashed on a couch” in an American embassy–owned house between meetings with Iranian representatives and an Omani sultan playing the role of middleman, recounts Landler. Eventually, Deputy Secretary of State William J. Burns helped to fill out the skeletal negotiating team.

Similarly, Obama handpicked two young aides to lead talks with Cuba: Benjamin J. Rhodes, a White House adviser and speechwriter; and Ricardo Zuniga, a Cuba expert who had served the United States in Havana. Encouraged by Obama and Pope Francis, the delegation of two sneaked out of Washington on commercial flights to meet with “an only slightly larger” Cuban delegation nine times in Canada and at the Vatican, write Landler and Michael R. Gordon in the Times.

U.S. climate-change negotiations with China were more straightforward, with Secretary of State John Kerry leading a team of heavy-hitting climate advisers. Although less subterfuge may have seemed necessary because of the slightly lower profile of the talks relative to those with Cuba and Iran, the Obama administration still kept them quiet—likely due to fear of being criticized if they failed—until the agreement was ready to be unveiled.

The administration’s strategy doesn’t mean you should assign untested negotiators to lead high-level talks simply for the sake of preserving secrecy. Rather, it suggests the importance of creative strategizing, tight control of negotiations from the top, and discipline when privacy is paramount.

Despite all your precautions, you can never be sure that your negotiations will remain under wraps. WikiLeaks’ ongoing declassification of government documents and last year’s hacking of Sony Pictures illustrate this point well. Remind your negotiating team members that all their communications during talks should reflect their noblest values and those of your organization.

When private disputes go public

    1. Negotiators are often tempted to take high-profile negotiations and dispute-resolution efforts public with the goal of winning in the court of public opinion. In 2011, for example, dozens of National Football League (NFL) players served as armchair quarterbacks during their union’s standoff with team owners over a new collective-bargaining agreement. Supported by the NFL Players Association, the players expressed their displeasure with the talks via Twitter.

This strategy may succeed in drumming up support, but it can backfire at the bargaining table. That’s because the larger the audience for your negotiation is, the more competitively you and your counterpart are likely to behave, write Harvard Business School professors Deepak Malhotra and Max H. Bazerman in their book Negotiation Genius: How to Overcome Obstacles and Achieve Brilliant Results at the Bargaining Table and Beyond (Bantam, 2007). A counterpart who’s angered by your or your supporters’ criticisms might retaliate by making embarrassing public revelations about you or filing a lawsuit. All the more reason, then, to hash out your differences behind closed doors.

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