A mediator no authoritative decision-making power; he or she cannot unilaterally mandate or force parties to resolve their differences and enforce the decision. This characteristic distinguishes the mediator from the arbitrator, who is generally empowered to make a decision for the parties on the basis of a prior agreement by the disputants or societal norms, rules, regulations, laws or contracts.
The goal of the judicial or quasi-judicial process is not reconciliation or agreement between the parties, but a unilateral decision by the third party concerning which of the parties is right.
An arbitrator examines the past and evaluates agreements that the parties have entered, violations which one has inflicted on the other and the norms concerning acquisition of rights, responsibilities, etc. which are connected with these events. When he has taken his standpoint on this basis, his task is finished.
The mediator on the other hand works to reconcile the competing interests of the two parties. The mediator’s tasks are to assist the parties in examining their interests and needs, to help them negotiate an exchange of promises and to redefine their relationship in a way that will be mutually satisfactory and will meet their standards of fairness.
The mediator does not have decision-making authority and this fact makes mediation attractive to many parties in dispute because they can retain the ultimate control of the outcome. However, mediators are not without influence. The mediator’s authority, such as it is, resides in his or her personal credibility and trustworthiness, expertise in enhancing the negotiation process, experience in handling similar issues, ability to bring the parties together based on their own interests, past performance or reputation as a resource person and (in some cultures) his or her relationship with the parties. Authority, or recognition of the right to influence the outcome of a dispute, is granted by the parties themselves rather than by an external law, contract or agency.