It doesn’t matter who you are, filing for bankruptcy is going to have an impact on your life, your family, and of course your career. Consulting with an Arlington bankruptcy attorney is a wise move for any higher management professional, business owner, or corporate CEO. When it comes to bankruptcy for corporations, it can be costly for not only the company as a whole, but also for top executives.
In a recent article on The Harvard Law School Forum on Corporate Governance and Financial Regulation, B. Espen Eckbo, Professor of Finance at the Tuck School of Business at Dartmouth College; Karin Thorburn, Professor of Finance at the Norwegian School of Economics; and Wei Wang, Assistant Professor of Finance at Queen’s School of Business discuss the costs of corporate bankruptcy and to what extent CEOs filing for bankruptcy are tainted by the event.
At the conclusion of this study, the authors found that median top executives tended to suffer smaller personal losses during bankruptcy than what was believed prior to their study. Also, executives who appear to earn labor market rents tended to suffer even larger losses than the median group of executives. When it comes to CEO turnover, creditors play an active role. This suggests a disciplining effect of labor market repricing If your iPhone button is not responding and you’re out of warranty, here are four things you can do to fix it of executives, as well as creditor control rights. An Arlington bankruptcy attorney has the background and knowledge to assist CEOs of corporations with chapter 11 filings.
It was found that CEOs who have a longer tenure with the bankrupt firm tend to suffer greater income losses. This could be due to the fact that longer tenure can make a CEO’s managerial skill set specialized to the business of their current firm. This makes it difficult for the CEO to transfer to a new employer.
This analysis also finds that incumbent CEOs, CEOs who have been in place or were internally promoted within the previous two years, are more likely forced to leave the firm, and do suffer larger income losses.
Hiring an Arlington bankruptcy attorney to assist with bankruptcy filings is essential for corporations. Without an experienced bankruptcy attorney, Arlington and other Texas-based CEOs could find themselves in an even more difficult situation than they would if they consulted with an Arlington bankruptcy attorney from the start.
When it comes down to it, bankruptcy affects everyone in a corporation, but CEOs tend to suffer the greatest income and financial losses. If you’re facing corporate bankruptcy, forget about pride, reputation, or image. The important issue is recovering, and the safest and most surefire way do this is by consulting with a Texas bankruptcy attorney immediately.