The trends acceleration caused by the pandemic makes it possible to identify new strategies for the continuity of companies beyond the covid-19 pandemic that will concern technological innovation, digital exports, extraordinary and alternative finance, the redefinition of the corporate governance and the generational changeover

by  Lorenzo Bacciardi, LL.M.

It is now generally accepted that the pandemic has caused, in the economic-entrepreneurial context, an acceleration of trends that would have occurred in a 3-5 year period. The companies which, upon their exit from the pandemic, are not aligned with thies acceleration will lose competitiveness and will exit the market.

The trends accelerated by the pandemic serve as a reference both for the identification of the business strategies and for the identification of the legal services which will be most required by the companies to support their strategies.

The acceleration on which to base the new business strategies and, therefore, the new legal services concern: a) the technological innovation, digital export, e-commerce; b) the extraordinary and alternative finance; c) the redefinition of the corporate governance and the generational changeover along with the adoption of management and asset allocation strategies.

In particular, companies will have to adopt an efficient digital transformation strategy across the entire value chain (IT, ICT, IOT, design, marketing, sale) in order to remain competitive, to differentiate products and services and to facilitate the operational efficiency.

Companies will also have to review their modalities of access to finance, by acquiring new channels of financial funding which are alternative – rather than additional – to bank finance, such as to better guarantee financial resilience. Consequently, companies will have to take an open approach to extraordinary or alternative financing solutions through private equity or private debt operations, in order to support their development and growth projects.

Digital transformation will therefore be a mandatory and imperative step, and no longer a choice. Digital technologies will drive the transformation and will be the key and the engine of any POST-COVID recovery.

Companies will still have to strengthen and better target their governance through processes of performance management and through assessment and organization of the top-level strategic human resources.

Finally, many companies have to, definitively and even irrevocably, perfect the generational changeover of the business. An increasing number of these companies is moving towards solutions of generational changeover of the business which are  aimed at achieving the business value in favour of the family, rather than aimed at achieving the business continuity in the hands of one or more successors within the family.

Such solutions will create more opportunities of extraordinary business operations, depending on the generational changeover, for national and foreign investors as well as for financial and industrial partners, which are interested in the Italian economic and industrial reality; but – such solutions – will also involve business legal advice to support the generational changeover of the business.

Other strategic areas of both business planning and legal advice will concern the reorganization of the supply chain for the procurement of raw materials, semi-finished and finished products, which can be implemented both through the return of production back to the company’s country and through the shortening of the procurement process.

For the same purpose, companies will have to redefine their production and distribution chains by setting up and/or strengthening  partnerships based on broader and more exclusive agreements; while, in order to strengthen  their presence in foreign markets, they will increasingly have to establish local units owned and organized by the parent company in the form of branches/subsidiaries and give them more autonomy.

The upheavals created by the pandemic will also cause a significant increase in litigation, especially related to problems arising from transnational commercial, corporate and technological relationships. The increase in litigation will require law firms not only to adopt a conciliatory and out-of-court settlement approach, but also to develop the necessary skills to handle international litigation, both judicial and arbitral.

From the scenario described above, it emerges that the legal services, that will be most requested from the companies in the post-pandemic context, will mainly concern – in addition to certain countercyclical practices relating to the contractual, litigation and labour areas – all the practices necessary to manage the recovery and ensure the continuity with reference to the corporate and tax law, to the new technology ,  e-commerce and industrial property laws, as well as to M&A and to the extraordinary and alternative finance.

Bacciardi and Partners, which for forty years has assisted most of the firms in the territory in their international growth processes and, in particular, in their legal, tax and customs compliance as well as in the extraordinary corporate transactions and extraordinary finance transactions, has integrated and strengthened its Corporate Law, M&A and Corporate Finance Departments and has established a new Technology Law and Digital Innovation Department, in order to integrate full capabilities to support firms in the uncertain and laborious journey back to the future.

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