Every company I’ve worked with in a turnaround has people around the table wearing more than one hat. A director has different duties than an officer. A creditor has different rights than a shareholder.

Take the owner-manager of a business in trouble. They’re the CEO, they chair the board, they own the shares, and they usually have shareholder loans on top of that. Those roles don’t line up.

As a shareholder, they want to keep the equity. As a lender to their own company, they want to be repaid. As a director, they owe a duty to the company and, once it’s insolvent, they have to think about the creditors.

It isn’t only distressed companies. Capital markets run on this every day. On a single raise a dealer can advise the company on the deal, buy the paper itself and resell it, place it with institutions, place it through its own retail advisers who are advising those buyers, publish research on it afterward, and give a fairness opinion along the way. The system works because it is disclosed and managed.

My answer is always the same. Disclose early and disclose often.

We have the same thing at Sinclair Range. We often act as chief restructuring officer or interim executive in a distressed business. We are also investment bankers. I sit on the credit committee of two lending funds, and sometimes one of those funds ends up on the same deal.

We think that is a positive for our clients and for our lenders. It only works because we put it on the table at the start and everybody agrees up front.