Carillion plc
Carillion Collapse
Estimated impact: £7B in liabilities; 43,000 jobs at risk
UK construction and outsourcing giant Carillion collapsed with £7B in liabilities and a pension deficit of £2.6B. The board continued paying dividends and awarding bonuses while the company was insolvent, using aggressive accounting to delay recognition of contract losses.
Decision context
Whether to continue bidding aggressively on low-margin government contracts and paying dividends despite deteriorating cash flow and mounting contract provisions.
Decision anatomy
Red = risk factor present · Green = protective factor present
Biases present in the decision
★ Primary driver · Severity estimated from bias type and decision outcome
Toxic combinations
Reference class base rates
Across all 143 curated case studies in our library:
Lessons learned
- Optimism bias in contract accounting delayed loss recognition until positions were irrecoverable
- Paying dividends from a cash-negative company is a framing effect that signals health while destroying value
- Government procurement that selects the lowest bidder without assessing contractor financial resilience creates systemic risk
Source: UK Parliament Joint Inquiry into Carillion, HC 769 (2018) (Case Study)
We caught these patterns in Carillion plc's own record — before the outcome.
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Workflows that fire on decisions like Carillion plc’s
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