Standard Contracts — What They Are and Why You Should Consider Using Them
I’m a big fan of standard contracts.
We’re not talking about those one-sided templates that a counterparty pushes on you because “it’s just our standard contract that everybody else signs!”
No, standard contracts are templates designed by independent third parties or committees. They’re written to reflect best practices for the particular type of agreement, such as an NDA, MSA, or SaaS agreement. And they’re drafted to be fair rather than one-sided, so they help avoid redlines.
These days, I’m usually the one proposing to the other side that we use a standard contract.
But last week, I was on the other side.
I got an order from to review. I followed the URL in the order form to the online terms and my eyes lit up: “I recognize these!”
This vendor had adopted a Bonterms standard agreement!
As someone who usually proposes a standard agreement, it was pretty great to see one out in the wild!
So here’s what happened next:
✔️ My trust in this vendor instantly skyrocketed. I knew they weren’t interested in back and forth redlines and instead wanted to help us both get to signature quickly.
✔️ I was already familiar with the terms themselves and was comfortable with how they’d apply to this deal.
✔️ During the busiest time of the year, I was able to turn the contract around quickly and move on to other deals on my desk.
Contract standardization doesn’t have the same hype as AI, but it’s a smooth, scalable way to improve what is usually a slow and frustrating process.
There are several contract standardization initiatives worth checking out:
• Bonterms (h/t Todd Smithline)
• GlobalNDA (h/t Roma Khan)
• Common Paper (h/t Jake Stein)
• oneNDA (h/t Electra Japonas)
Have you ever worked with a counterparty who proposed a standard contract? How did it go?