Diplomacy describes the relation between individual rulers, if they are at war, neutral, or allied. Relations are not necessarily mutual. In addition to being a statement towards another ruler, they also dictate how your fleets' standing orders are applied.

To change relations, you must send a dispatch with your intended new stance towards the recipient. They may or may not reciprocate. Rulers you have no contact with are considered neutral.

You can see and change all your relations on the diplomacy page in the Relations menu. Here you can also block individuals from sending you messages, or you can break relations with neutrals completely, as such removing them from your lists.