Insolvency
“INSOLVENCY is not a dirty word” – Let’s change the insolvency conversation By Andrew Spring MICM*
Andrew Spring MICM
Similar to that classic Skyhooks anthem, Ego is not a dirty word, it is time to challenge the way that we think about insolvency and our interactions with those involved or associated with it. Our world has changed so much this year, more akin to playschools Upsy Down Town, than to what we had been accustomed. And with many of us braving the likes of working from home or video conferencing for the first time, why not use this upheaval as a way to tackle some of the other result limiting stigma’s that exist – starting with insolvency. Certainly, the Government would have us believe that entering into an insolvency process is welcoming the apocalypse, but to follow that analogy, then perhaps we should consider the prophesying of R.E.M who claimed It’s The End Of The World As We Know It (And I feel fine). In reality, even the powers that be understand that an effective use of the insolvency regime is necessary in a vibrant and self-sustaining economy, evidence by the, as yet unlegislated, Insolvency Reform proposals. It is also important to remember that behind every insolvency appointment at the core of each stakeholder is people. In a very trying time, loading inappropriate
community stigma’s onto the stresses already faced by many of us is damaging and dangerous. So why the musical theme? Because music is universal. It does not judge you and it does not discriminate. Whether you like it or hate it, it does not mind. It is just there for you. Unfortunately, most things in life are not as pure, particularly in business and certainly in Insolvency. But in the spirit of opening our minds to the possibilities of changing our perspective on Insolvency, let’s strip back our insolvency process to its core. What is the insolvency process designed to achieve? Defaulting trade relationships have occurred since the beginning of trade itself. The consequence being largely determined by the community’s moral guidance – early insolvency law. For example, the Ancient Greeks, would force debt slavery on the delinquent debtor and his family until the debt was repaid by physical labour. In our own history, we utilised debtor prison as an encouragement for the defaulting party to pay what was owed. Certainly, times have changed as the morality of our community has determined that the imprisonment of debtors is no longer acceptable, nor perhaps, particularly effective ➤
October 2020 • CREDIT MANAGEMENT IN AUSTRALIA
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