They examined fifty years of data to see what causes companies to fail - Part 1

Research by Boston Consulting Group indicates no significant correlation between economic cycles and the frequency of company delistings. Despite a decrease in company closures since the early 2000s, firms have not become significantly more resilient. The study highlights that company age, size, and industry are more critical factors in determining risk. The average delisting risk has dropped from around 40% in the early 2000s to about 18% today, returning to levels seen in 1980. However, approximately 20% of publicly traded companies in the U.S. face delisting risk within five years, increasing to nearly 25% when considering the average CEO's tenure. The decline in delisting rates is attributed to fewer companies on the stock market and stricter entry requirements, particularly following the dot-com bubble burst and the implementation of the Sarbanes-Oxley Act in 2002.