Final answer:
A subordination resolution is executed by a business's governing body to establish the ranking order of creditor claims in scenarios like debt restructuring.
Step-by-step explanation:
The governing body of a business organization must execute a subordination resolution in order to designate the relative priority of its debt instruments, typically in situations involving debt restructuring or issuing new debt. A subordination resolution is a legal document that establishes one creditor's claim as ranking behind that of another in the event of a bankruptcy or liquidation. This is often used when a company wants to borrow additional funds and the new lenders require that their claims to any assets are prioritized over existing debts.