Overcoming corporate crises

When companies face an existential crisis, every decision counts. Yet even in seemingly hopeless situations, opportunities for a fresh start can open up. By deploying legal instruments in a targeted way, companies can not only safeguard their financial viability but also set a course for a sustainable future.

We bring together deep expertise in insolvency law and adjacent fields to steer your company out of crisis. Our legal advisory team works closely with specialists in finance, operations and strategy to deliver holistic crisis advice from a single source.

Causes of corporate crises

There are many reasons why companies fall into crisis or slide into insolvency. External factors include weak demand, intensified global competition and disruptions to the business model. Rising production costs, trade wars and interruptions to global supply chains can also put companies in a difficult position.

Internal factors include failing to further develop the business model in a dynamic market with changing customer needs. In addition, a lack of product innovation, inefficient processes, incorrect management decisions and rigid organisational structures can trigger a crisis.

Depending on your company’s situation, we work with you to develop tailored solutions to lead you out of crisis quickly and sustainably.

It is vital to recognise crises early and take immediate action – whether by adapting the business model, improving operational performance or strengthening financial capacity.

In a dynamic economic environment, early crisis detection is crucial to preserving your company. Company directors are responsible for identifying potential challenges in good time and taking appropriate measures. With an effective early warning system, you protect not only your company but also your employees and partners.

The key to early crisis detection lies in combining forward‑looking corporate planning with continuous monitoring. Even small financial or operational changes can have long‑term effects. From the loss of key customers and reliance on short‑term financing to unexpected political decisions, early warning signals can appear at various stages of a crisis. A well‑structured early warning system helps you identify relevant risks and analyse how they interact.

The legal toolkit also offers a wide range of restructuring options. Depending on the situation, measures such as out‑of‑court reorganisation, self‑administration, protective shield proceedings, transfer reorganisation or regular insolvency proceedings may be appropriate.

Approach and success factors

For restructuring to succeed, a pragmatic approach and the right balance between stakeholder interests are essential – from management and executives to the works council, employees and the HR department, through to creditors, investors and suppliers. A stakeholder analysis provides clarity on who is affected by the restructuring, to what extent, and how much influence they have.

Further key success factors include structured, rigorous project management and sustainable adaptation of the business model. In practice, restructurings tend to be most successful where management is coached at each phase and the workforce and co‑determination bodies are engaged respectfully through change management and communication.

Modern insolvency law aims to reorganise companies, preserve jobs and enable the reorganised company to make a fresh start. We support you in the following areas:

Corporate law reorganisation measures play a decisive role in overcoming financial crises. They are designed to restore a company’s liquidity and profitability to secure its long‑term survival. These include, for example, capital increases, restructuring of liabilities, negotiations with creditors and adapting the company’s strategy.

The legal framework for such measures varies depending on the company’s legal form and the national legislation concerned. A key aspect is close collaboration between management, shareholders and creditors to reach consensus on the necessary steps.

Restructuring requires carefully prepared steps in dealings with the workforce and their representatives. On the one hand, the right strategic approach to employment law issues is crucial in short‑term cost‑saving programmes. On the other, the aim is to set the framework for a resilient future for the company over the long term together with employees, works councils and trade unions. Together with management and the finance and HR functions, we identify short‑ and long‑term potential for change and help to implement it.

In today’s complex corporate landscape, it is crucial to have an adviser at your side who brings multiple disciplines together under one roof. In a restructuring, numerous topics interlock and cannot be neatly separated. Comprehensive support that includes legal and tax advice as well as strategic advice makes it possible to consider all relevant aspects efficiently and make well‑founded decisions.

With our holistic advisory approach, we lead your company out of crisis and help you build lasting resilience. We also support you in special situations connected with reorganisation measures – whether cross‑border cases or ESG, IP/IT and subsidy‑related matters – with the right expertise.

Alongside deep experience, best practice and agile cost modelling, we rely on modern tools to steer all measures efficiently via the Project Management Office (PMO). These include, for example, a restructuring dashboard that lets you compare different scenarios, calculate restructuring costs and track the implementation of operational measures.

Whatever your situation, we will support you through every phase and offer tailored solutions.