The turnaround industry in South Africa

Vision for the turnaround industry in South Africa

Our vision of this section of our web site is to be seen as major role player in the establishment and functioning of a vibrant corporate renewal, turnaround and business rescue industry in South Africa through serving as a news and communication medium, and facilitating interaction between stakeholders.

The first step towards achieving this vision was to provide information relevant to turnaround industry stakeholders on a continual basis. 

This comprises of of our views as well as contributions by industry stakeholders - as per the menu on the left.

An important past contribution was providing the communication backbone for 100 industry stakeholders participating in the Task Group for Organising the Turnaround and Business Rescue Industries in 2004.

Another important contribution was hosting the web site material of Turnaround Management Association - Southern Africa - Southern Africa from March 2005 to April 2006 when it set up its own web site domain.

Mission of this section on the turnaround industry in South Africa

Our mission is to promote the South African turnaround, corporate renewal, and business rescue industries as a web site publication. 

Our original mission statement has largely been absorbed into the mission statement of the Turnaround Management Association - Southern Africa - Southern Africa (TMA-SA) when the latter was formed in March 2005.

Accordingly, our revised mission statement reads as follows:

  • Promote the regulation of formal business rescue foreseen in new business rescue legislation and through a body such as ABASA (Association of Business Administrators of South Africa).
  • Promote a culture of corporate renewal, turnaround and business rescue in South Africa, with job preservation as an important imperative.
  • Promote BEE in the turnaround industry through HDI ownership, operational involvement, skills transfer and training, and purchasing.
  • Make the case for turnaround to the business community, the government, academia and the media.
  • Educate the business community by placing a basic body of turnaround management knowledge into the public domain, including turnaround news, events, opinions, links, publications; understanding the timeline of financial distress; how the industry works in terms of structure, participants, driving forces and constraints; new business rescue legislation; industry associations; liquidation news and statistics; unemployment news and the imperative of job preservation; etc.
  • Advance the theory and practice of turnaround management in SA. 
  • This section offers turnaround-related forums and chat, news, and information regarding turnaround events, opinions, links, publications, business rescue legislation and associations, which can be accessed via the links in the menu on the left.

    The views expressed here on the turnaround industry in South Africa are those of CRS Turnaround.

The turnaround industry in South Africa in a nutshell

The turnaround industry in South Africa is a professional community of turnaround and corporate renewal professionals who share a common interest in strengthening the economy through the restoration of corporate value.

Turnaround industry structure provides information about the firms and professionals participating in the turnaround industry, as well as turnaround industry driving forces and constraints.

South Africa has an active, albeit hitherto fragmented turnaround management industry, working with underperforming and distressed companies in the informal turnaround sector i.e. outside of insolvency legislation.

Organised turnaround industry

Two factors caused the industry to organise itself.

Firstly - although South Africa has a rich history of successful turnarounds, there were also many notable failures. 

Overseas experience has proved that bringing together turnaround professionals from all disciplines, including government, management and banks, to work towards common goals, leads to earlier and improved corrective action by management, more successful informal creditor workouts and a higher success rate of business rescues.

Secondly - with judicial management generally a failure, South Africa does not presently have a true statutory business rescue mechanism. 

As a result, many distressed companies, which could possibly have been rescued, are liquidated by default, contributing to South Africa’s already high rate of unemployment (see liquidation statistics).

This is set to change, however, with the proposed introduction of new business rescue legislation which will provide distressed companies with a second chance.

As a result, the following industry initiatives were put in place to organise the industry:

  • Task Group for Organising the Turnaround and Business Rescue Industries (2004).  

This was a CRS Turnaround initiative, which spawned the next two initiatives.

This too was a CRS Turnaround initiative and TMA-SA formed part of this turnaround industry in South Africa section until April 2006, when it was migrated to its own web site.

  • ABASA - Association of Business Administrators of South Africa (2004). 

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