It just got easier for struggling business owners and directors to browse the professional expertise of trusted business advisory specialists using the ABRT Professional Directory.
The business restructuring and turnaround landscape is evolving rapidly. The current economic climate calls for a drastic change to the approach taken in advising micro, small, medium and family businesses (MSMEs).
A huge step towards encouraging entrepreneurial risk taking and innovation in business was the announcement of the Insolvency Safe Harbour under section 588GA of the Corporations Act 2001.
This provides directors, who might suspect insolvency, with the opportunity to remain in control of a company and seek various restructuring and turnaround strategies. Where attempts are unsuccessful (in the worst-case scenario), directors get protection from insolvent trading personal liability provided they reasonably believed their restructuring and turnaround strategies would result in a ‘better outcome’. This is where it is critical that directors seek advice from an ‘appropriately qualified entity‘.
The ABRT considers the wording relating to an ‘appropriately qualified entity’ reflects the fact that the variety of appropriate advisors to a company are likely to be as diverse as businesses themselves. The ideal turnaround advisor might range from a qualified engineer in with operational turnaround “know how” to an investment bank with experience in complex cross-border restructures.
Directors must be able to seek the advice that is right for their unique business predicament. No exhaustive list of accreditation can possibly cover the range of skill sets and practical experience which can be effectively brought to bear on effectively managing crisis and turnaround.
Directors must be able to source advice from advisors with the appropriate skills and experience relevant to specific circumstances and turnaround requirements, irrespective of whether or not they belong to any single accredited profession (for eg, a registered liquidator, lawyer, accountant etc.) or any individual single professional body.
Depending on the nature of an organisation’s industry, and the size and complexity of the situation, may be more appropriate for directors to engage a ‘turnaround team’ – multiple advisers, all tasked with assisting in specific areas, and whose advices collectively inform the decisions of the board (and do not conflict with advice the director may wish to receive on a personal level).
In agreement with the ASBFEO, the ABRT firmly believes it is the management and owners of the business that possess critical capital knowledge and industry expertise to salvage value. Every turnaround requires a unique skillset and the involvement of a range of professionals (to various degrees and at different stages).
The ABRT Professional Directory can be used to find an appropriately qualified practicing business turnaround expert to help formulate initial strategies. However, it might also be utilised to source addition professional opinions, advice and guidance from a range of accredited professions and/or industry experts.
Opinion: Author
Eddie Griffith is the principal partner at TurnAbout AU based in South Australia, and is the ABRT founder and Chairman.