How corporate activities change when faced with a new reality
A thesis discussed at the Polytechnic University “Giorgio Fuà” helps us better understand this theme
A pandemic and two new sets of economic guidelines have necessarily led to some changes in the way companies do business, including strategic and financial planning. But how? Answering this is important, as it will also illustrate the particular transformation that has affected production culture itself and the way in which it influences how companies are conceived, created and managed. Consuelo Paoletti explores these topics in her thesis, presented at the Polytechnic University of the Marche “Giorgio Fuà”, Faculty of Economics, Master’s Degree in Economics and Management.
Her work is entitled Covid-19, Codice della crisi d’impresa e nuove linee guida EBA: l’impatto sulla pianificazione strategica e finanziaria (COVID-19, Business crisis code and new EBA guidelines: the impact on strategic and financial planning) and attempts to analyse the impact that the three above-mentioned factors have had on businesses. “These three occurrences,” the researcher states in her introduction, “have deeply affected some companies, so much so that a few of them were not able to continue with their activities or are finding themselves in a position where their best choice is now to shut down.” Paoletti proceeds to investigate the reasons that led to such circumstances, explaining that, in many cases, this is the result of insufficient care in scheduling and planning, as well as neglect of potential ways that could safeguard the companies. She then explicitly states the aim of her study: “The goal is to illustrate the implementation of a business plan looking at both its ‘qualitative’ and ‘quantitative’ aspects and integrating into the latter an analysis and some indicators that can help entrepreneurs to comply with the new guidelines while adapting to the new market and banking laws.”
To this end, the thesis begins by framing the concept of a business plan as a basic tool for strategic planning, then explores the “tools and analyses” required for the overall assessment of a corporate project and, finally, draws a comparison integrating the three great events with which companies had to recently deal – the new Italian Code of business crisis, the new EBA guidelines, and the COVID-19 pandemic – and, finally, includes two case studies summarising the results.
In her conclusion, Paoletti writes, “Corporate continuity is the initial premise, without which any consideration, forecasting, market analysis, search for new finances would be useless. Nowadays, a feasible business plan must include a synthetic crisis forecasting model through which entrepreneurs can show whether they are or not within the boundaries imposed by the Code of business crisis. As Covid taught us, an optimistic five-year plan mapping forthcoming positive cash flows cannot be considered complete without an adequate scenario analysis considering market fluctuations, especially negative ones. As such, the worst-case scenario may mean that the plan no longer complies within the parameters set by the EBA and a strict credit rating, and the company might no longer be able to count on planned financial resources, so that banks will start doubting debt sustainability and, once the rating has deteriorated, obtaining credit will only become more difficult.” Having completed her analysis, Paoletti then proposes a circular model, whereby “the business plan will be deemed satisfactory and suitable to meet the new requirements, restrictions and market changes if, in all outlined scenarios, the company remains able to comply with the conditions imposed by the bank and does not foresee exceeding the limits set by the crisis indicators.”
Consuelo Paoletti’s investigation strives to harmonise theoretical analysis corporate instruments, as well as concrete corporate case studies, within a logical approach, which makes for excellent research.
COVID-19, Codice della crisi d’impresa e nuove linee guida EBA: l’impatto sulla pianificazione strategica e finanziaria (COVID-19, Business crisis code and new EBA guidelines: the impact on strategic and financial planning)
Consuelo Paoletti
Thesis, Polytechnic University of the Marche “Giorgio Fuà”, Faculty of Economics, Master’s Degree in Economics and Management, 2021.
A thesis discussed at the Polytechnic University “Giorgio Fuà” helps us better understand this theme
A pandemic and two new sets of economic guidelines have necessarily led to some changes in the way companies do business, including strategic and financial planning. But how? Answering this is important, as it will also illustrate the particular transformation that has affected production culture itself and the way in which it influences how companies are conceived, created and managed. Consuelo Paoletti explores these topics in her thesis, presented at the Polytechnic University of the Marche “Giorgio Fuà”, Faculty of Economics, Master’s Degree in Economics and Management.
Her work is entitled Covid-19, Codice della crisi d’impresa e nuove linee guida EBA: l’impatto sulla pianificazione strategica e finanziaria (COVID-19, Business crisis code and new EBA guidelines: the impact on strategic and financial planning) and attempts to analyse the impact that the three above-mentioned factors have had on businesses. “These three occurrences,” the researcher states in her introduction, “have deeply affected some companies, so much so that a few of them were not able to continue with their activities or are finding themselves in a position where their best choice is now to shut down.” Paoletti proceeds to investigate the reasons that led to such circumstances, explaining that, in many cases, this is the result of insufficient care in scheduling and planning, as well as neglect of potential ways that could safeguard the companies. She then explicitly states the aim of her study: “The goal is to illustrate the implementation of a business plan looking at both its ‘qualitative’ and ‘quantitative’ aspects and integrating into the latter an analysis and some indicators that can help entrepreneurs to comply with the new guidelines while adapting to the new market and banking laws.”
To this end, the thesis begins by framing the concept of a business plan as a basic tool for strategic planning, then explores the “tools and analyses” required for the overall assessment of a corporate project and, finally, draws a comparison integrating the three great events with which companies had to recently deal – the new Italian Code of business crisis, the new EBA guidelines, and the COVID-19 pandemic – and, finally, includes two case studies summarising the results.
In her conclusion, Paoletti writes, “Corporate continuity is the initial premise, without which any consideration, forecasting, market analysis, search for new finances would be useless. Nowadays, a feasible business plan must include a synthetic crisis forecasting model through which entrepreneurs can show whether they are or not within the boundaries imposed by the Code of business crisis. As Covid taught us, an optimistic five-year plan mapping forthcoming positive cash flows cannot be considered complete without an adequate scenario analysis considering market fluctuations, especially negative ones. As such, the worst-case scenario may mean that the plan no longer complies within the parameters set by the EBA and a strict credit rating, and the company might no longer be able to count on planned financial resources, so that banks will start doubting debt sustainability and, once the rating has deteriorated, obtaining credit will only become more difficult.” Having completed her analysis, Paoletti then proposes a circular model, whereby “the business plan will be deemed satisfactory and suitable to meet the new requirements, restrictions and market changes if, in all outlined scenarios, the company remains able to comply with the conditions imposed by the bank and does not foresee exceeding the limits set by the crisis indicators.”
Consuelo Paoletti’s investigation strives to harmonise theoretical analysis corporate instruments, as well as concrete corporate case studies, within a logical approach, which makes for excellent research.
COVID-19, Codice della crisi d’impresa e nuove linee guida EBA: l’impatto sulla pianificazione strategica e finanziaria (COVID-19, Business crisis code and new EBA guidelines: the impact on strategic and financial planning)
Consuelo Paoletti
Thesis, Polytechnic University of the Marche “Giorgio Fuà”, Faculty of Economics, Master’s Degree in Economics and Management, 2021.