Big brands are using company voluntary arrangements (CVAs) to manage the financial impact of Covid-19. But experts warn they can damage the reputation of businesses—and directors.
Stories of companies going bust and redundancies currently litter news sites and TV bulletins. But a number of big name brands have opted to use a company voluntary arrangement (CVA) as a means of surviving the economic implications of the pandemic and lockdown. So what are CVAs and why are companies using them?
In the past few weeks shoe brand Hotter, Travelodge, fashion chain AllSaints, the Restaurant Group, operators of the Wagamama and Garfunkels eateries, and Poundstretcher, the discount store, have all announced CVAs to help get them through their current troubles.
Store closures and job losses are part of the deal, but CVAs do no
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