Corporate Contingency Plan
Very few companies create a formal corporate contingency plan, but all companies would benefit from having one. The point to the contingency plan is to establish who has authority and what steps should be taken in the event that certain key employees or owners are no longer available or able to act in their respective capacities. Whether due to death, disability, or otherwise, an individual may suddenly not be able to perform his or her duties for the enterprise. If this is the entrepreneur, then the impact is of course most devastating.
And while planning for death is the most common driver to the BSA, there are a variety of triggers of equal, if not even greater, importance.
- Voluntary transfer
- Involuntary transfer
- Resignation (before a specified retirement age)
- Attainment of stated return or economic threshold
- Loss of professional license
- Passage of a stated period of time
- Conviction of a crime
- And anything else that fits your circumstance
This is just a start. You will be learning the many issues businesses and partners will face in their lifetime.