The current state of the world's economy is
unfortunately taking its toll on many businesses. We hear about
these hardships almost on a daily basis.
In 2008, there were over 12,000 corporate insolvencies
Australia-wide. That figure is sure to increase significantly in
2009. This in turn will inevitably lead to an increased focus on,
and number of, insolvent trading claims against directors.
The collapse of high profile companies earlier this decade, such
as HIH Insurance Group, One-tel, Harris Scarfe and Ansett, saw a
significant shift in the public opinion and debate on the
director's position within the company. The popular view
was (and perhaps still is) that the wealth generated by directors
via a company was generally untouched by the company's
collapse. Such a position, while in accordance with the principle
that the company is a separate entity to its directors, does not
sit well with creditors and public company shareholders.
Accordingly, accountability of
