The Components Of Corporate Governance For Financially Distressed Firms

Companies of all sizes fall into financial distress. At such point, some are governed by the directors and some move into a more formal external administration conducted by an insolvency practitioner. There are similarities and significant differences in what the law imposes on directors and insolvency practitioners. This article looks at the components of corporate governance for financially distressed companies in Australia, exploring who controls the entrants and exits, the timing, the diversity and the other components of those who manage financially distressed companies and draws international comparisons where relevant. Additionally, in exploring these components, it questions whether any inequalities can be justified and, if so, how they could be managed. A particular focus is on the Australian period when a company has entered a Deed of Company Arrangement and relevant comparisons with other jurisdictions are made.