Lawyers acting for underperforming businesses may well come across a new boardroom creature – the chief restructuring officer (CRO). CROs, or turnaround directors (TDs) as they are sometimes known in the UK, are becoming an increasingly common aspect of successful turnarounds across Europe, as stakeholders place a greater emphasis on rescue-oriented procedures.
When a company is seriously underperforming, it is often the financial stakeholders that will push for management change and a more proactive approach to restructuring the business. This is where TDs step in to drive forward the turnaround process, often consulting closely with their legal advisers on matters such as the implications of a loan covenant breach.
