Best Practices for CVA Execution: A Guide to Company Voluntary Arrangements

September 4, 2025

A Company Voluntary Arrangement (CVA) offers struggling businesses a structured and legally recognised pathway to manage debt while continuing to trade. For many directors under pressure from creditors, a CVA provides a lifeline that safeguards jobs, preserves reputation, and stabilises operations.

At Nexus Corporate Solutions Limited, we have guided many UK businesses through the CVA process, helping them secure creditor approval and build foundations for long-term recovery. This guide outlines best practices for CVA execution, combining technical insight with practical strategies that align with creditor expectations and business needs.

Understanding Company Voluntary Arrangements

A CVA is a legally binding agreement between a company and its creditors, designed to restructure debts into manageable repayments over a set period. It allows a viable business to address its financial challenges while avoiding liquidation or administration.

For directors, the advantages are significant:

  • Protection from aggressive creditor actions such as winding- up petitions.

  • The ability to ringfence cash flow and prioritise operational stability.

  • The opportunity to maintain control of the company, rather than ceding authority to administrators.

Best practices for CVA execution begin with clarity. Before entering negotiations, directors should assess their company’s financial health, identify sustainable revenue streams, and establish whether ongoing trading is viable. A CVA should not be seen as a delay tactic but as a tool for meaningful restructuring.

Minimalist infographic showing the key stages of a Company Voluntary Arrangement (CVA) process with labeled icons: handshake for agreement, courthouse for approval, cog for process, rising graph for outcome. Flowchart uses clear arrows, professional colors, and clean sans-serif labels.

When a CVA is the Right Solution

Company Voluntary Arrangements excel in situations where a business remains fundamentally viable but is temporarily burdened by unmanageable debt. At Nexus Corporate Solutions Limited, we frequently encounter businesses that have strong underlying assets, a loyal customer base, or access to future revenue streams, yet are struggling due to unforeseen challenges such as economic downturns, loss of a major contract, or rapid shifts in market conditions.

In these cases, a CVA allows companies to address creditor pressures, ringfence cashflow, and ultimately keep trading, preserving jobs, brand value, and trade relationships.

Not every distressed company will qualify for a CVA. This route is best suited for businesses with strong fundamentals but unsustainable debt burdens. Typical scenarios include:

  • Companies with healthy sales pipelines but legacy tax arrears or supplier debts.

  • Businesses tied to expensive lease obligations on underperforming properties.

  • Organisations facing temporary cashflow disruption due to market downturns or loss of a major client.

A best practice is to act early. Once cost-saving measures and internal efficiencies have been exhausted, directors should consult an insolvency practitioner. Preparing a credible CVA proposal that clearly outlines repayment schedules, realistic forecasts, and the benefits for creditors significantly increases the likelihood of approval.

Step-by-Step Best Practices for Executing a CVA

Guiding your business through a Company Voluntary Arrangement requires meticulous planning, clear communication, and steadfast operational focus. At Nexus Corporate Solutions Limited, we believe success in any CVA hinges on structured processes adapted to your company’s needs. Effective execution spans from stakeholder alignment to precise restructuring implementation, ensuring creditor confidence and securing your company’s future.

In this section, discover actionable steps for maintaining open lines of communication with all parties, preserving daily operations during challenging transitions, and nurturing trust among employees and partners throughout the CVA journey. Our insights are rooted in years of experience supporting UK businesses through tailored restructuring solutions.

1. Transparent Stakeholder Communication

Open dialogue with all stakeholders, creditors, employees, landlords, and suppliers, is central to CVA success. Engaging early builds trust, clarifies intentions, and reduces the risk of rejection. Directors should:

  • Provide creditors with transparent financial forecasts and repayment plans.

  • Reassure employees about job security through regular updates.

  • Demonstrate to suppliers and landlords how continued cooperation benefits all parties.

This proactive approach helps create a shared vision for recovery rather than resistance or doubt.

2. Maintaining Daily Business Operations

A CVA is only effective if the company continues to trade profitably. During restructuring, directors must prioritise revenue-generating activities and protect customer relationships. Practical measures include:

  • Safeguarding core service delivery.

  • Using accurate trading forecasts for cashflow planning.

  • Avoiding cost reductions that harm business continuity.

Working with experienced insolvency practitioners ensures that financial controls are rigorous without undermining essential operations.

3. Building a Credible CVA Proposal

The proposal document is the cornerstone of the CVA process. It must demonstrate to creditors that supporting the arrangement is in their best interest. Essential elements include:

  • Honest disclosure of liabilities and assets.

  • Realistic repayment terms based on trading forecasts.

  • Evidence of cost-control measures already in place.

  • A clear timeline for debt repayment.

Best practice is to balance creditor returns with company sustainability. Overly optimistic projections risk undermining confidence and damaging negotiations.

4. Securing Creditor Buy-In

A CVA requires approval from at least 75% (by debt value) of voting creditors. To achieve this threshold, directors must foster confidence. This involves:

  • Providing data-backed forecasts that creditors can trust.

  • Addressing concerns with transparency and flexibility.

  • Highlighting the benefits of the CVA compared to alternatives such as liquidation, where returns are often lower.

By presenting the CVA as the most practical solution for creditors and the company alike, directors improve the likelihood of gaining support.

Navigating Challenges During the CVA Process

CVA execution is not without obstacles. Businesses may face scepticism from creditors, cashflow strain, or internal uncertainty among staff.

  • Creditor scepticism: Addressed through data-driven forecasts and open communication.

  • Cashflow pressure: Mitigated with realistic repayment schedules and disciplined financial management.

  • Employee morale: Supported through reassurance, clear messaging, and involvement in the recovery journey.

Treating challenges as opportunities to strengthen processes helps build resilience and positions the company for stability after the CVA is implemented.

Long-Term Benefits of a CVA

When executed properly, a CVA delivers benefits that extend beyond debt restructuring:

  • Safeguarded jobs: Protecting livelihoods and maintaining workforce stability.

  • Stronger creditor relations: Built on transparency and mutual trust.

  • Sustainable growth: By focusing on profitable areas and eliminating inefficiencies.

  • Preserved reputation: Avoiding the reputational damage often associated with liquidation.

The best practices for CVA execution encourage directors to adopt a long-term outlook. A CVA should be a platform for cultural and operational change, not simply a short-term fix.

Why Work with Nexus Corporate Solutions Limited

Choosing the right partner is critical to CVA success. At Nexus Corporate Solutions Limited, we offer:

  • Tailored solutions: Every business has unique challenges, and our CVA strategies reflect this.

  • Experienced practitioners: With years of restructuring expertise, we understand creditor expectations and legal requirements.

  • Practical support: From proposal drafting to ongoing creditor engagement, we stand alongside directors throughout the journey.

  • Commitment to outcomes: Our goal is not only to help businesses survive financial distress but also to position them for renewed growth and stability.

If your company is facing creditor pressure and financial uncertainty, a CVA may provide the protection and flexibility you need.

Take the Next Step

A CVA can provide a clear and structured route out of financial distress. With the right guidance, businesses can secure creditor support, maintain operations, and rebuild for the future.

At Nexus Corporate Solutions Limited, we are ready to help you assess your eligibility and prepare a robust, persuasive CVA proposal. Contact our expert team today for a confidential consultation and take the first step towards renewed financial health.

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