The Society of Practitioners of Insolvency (SPI) is rebranding and changing its membership criteria in a bid to prevent a potential split in its organisation.
The 2,000-member organisation will now be known as the Association of Business Recovery Professionals, and instead of only admitting insolvency licence-holders it will welcome anyone working with under-performing businesses.
The changes at SPI follow months of speculation about the future of the organisation after a US group threatened to open a branch in London, attracting City members.
The Turnaround Management Association planned to move away from the traditional insolvency market and welcome a much broader range of business recovery specialists.
The SPI now recognises that lawyers in big City firms tend to be more involved with rescuing companies than dissolving them.
President-elect at the Association of Business Recovery Professionals Stephen Gale, an insolvency partner at Herbert Smith, says: "Most of our members are turning companies around - banks are becoming much more willing to explore alternatives to insolvency than they were.
"The name had to be changed to reflect the work. A lot of lawyers were put off by the word insolvency - it's not good when you walk into a company hoping to rescue it."
At present 200 of the association's members are law-yers, the rest are accountants. Gale takes over the presidency in April, and says he hopes the moves will attract a broader membership from lawyers.
Top insolvency partner Nigel Barnett at Wilde Sapte says: "It's a welcome step that they are recognising the insolvency world contains more than just licence-holders taking appointments.
"I will join now - it must be a sensible way forward for the organisation as our current economic climate suggests turnaround is the favoured option for most of the lending organisations."
Paul Harris, head of insolvency at Irwin Mitchell, says that City firms will not be allowed to take over the organisation. He says: "More of the City firms will come in but the SPI operates on a regional basis and London is just one of those regions."