Over the past decade, a new term has emerged in the global economy that has stirred both interest and concern: “zombie companies”. These companies, while formally operating, live in the shadow of debt, and are only able to “survive” thanks to low interest rates and the support of financial institutions. Unable to generate sufficient profits to repay capital, they constitute an unusual economic phenomenon that affects both market dynamics and financial stability. “Zombie companies” not only hinder the potential for economic growth, but also raise questions about the effectiveness of monetary policy and government interventions in times of crisis. This article will explore the causes of their emergence, their consequences for the global economy, and possible strategies for managing them. Analyzing various cases from different parts of the world, we will also look at whether there are effective methods for “saving” zombie companies and what challenges economic decision-makers face when making decisions about their future.
What are zombie companies?
Zombie companies are companies that do not have enough profits to continue operating and servicing debt, but are unable to repay their debt. Such companies, given that they survive only on overhead costs (e.g., salaries, rent, interest on debt), do not have surplus capital that they can invest to stimulate growth. “Zombie companies ” are particularly dependent on banks for financing, which is essentially their source of income. Zombie companies are also known as “living dead” or “zombie stocks.”
The Whistleblower Protection Act of 14 June 2024 is a key element of the Polish legal system, aimed at protecting people reporting irregularities in the workplace (Article 4 of the Act – definition of a whistleblower). The provisions of this legal act focus primarily on ensuring effective internal reporting mechanisms, which aims to build a culture of compliance with the law in organizations. The Act sets out obligations for employers and gives whistleblowers specific tools to defend their rights. This analysis focuses on key aspects of the Act, such as reporting procedures, whistleblower protection and the impact of the Act on employee-employer relations.
Polish law provides for two types of work permits: type A and type B.
Type A permit applies to foreigners performing work in the territory of the Republic of Poland on the basis of an agreement with an employer whose registered office, place of residence or branch, plant or other form of organised activity is located in the territory of the Republic of Poland (Article 88, paragraph 1, item 1 of the Act on the promotion of employment and labour market institutions – hereinafter referred to as the Act).
Crowdfunding is an increasingly popular form of obtaining financing for ventures in which people interested in their success are involved. As part of this method, individual investors have the opportunity to invest money in projects of their choice, which in the future have a chance to bring them profits. Depending on the specific conditions, they can purchase shares in a company or lend the company funds for a specific purpose. At this point, it is worth considering the characteristics of these forms of financing.
Competences of the President in managing the company’s affairs
The management board is an integral element of a Polish limited liability company. It is appointed by the company’s shareholders. The management board appoints its president, who heads it. This involves the president having many responsibilities that he must fulfill.
The president, as a member of the management board, has two functions in taking up matters, because he can take them up himself or he is the executive tool of the shareholders. The president, as a member of the management board, has the right to manage the company’s affairs. This applies to both judicial and extrajudicial matters. Article 208 § 3 of the Polish Commercial Companies Code allows the president to conduct matters not exceeding the scope of ordinary company activities, without a prior resolution of the management board. Activities of ordinary management may refer to internal and external affairs of the company. When deciding which activity exceeds the scope of ordinary activities, consideration should be given to circumstances such as the size and nature of the activity. In short, it is the amount of the company’s available financial resources. In proportion to the activity performed and the company’s budget, it can be concluded whether a given activity exceeds this scope. Of course, the company agreement (articles of association) may specify what activities fall under the ordinary management of the company. Therefore, decision weight is an abstract concept and depends on the conditions of a given entity. All decisions made should be rational, accompanied by documents justifying the decision.
