A snapshot survey of businesses across Northern Ireland has revealed a significant gap in succession planning, with less than one in ten respondents reporting that they have a formal written succession plan in place.
The survey, carried out by Employee Ownership Ireland to coincide with Employee Ownership (EO) Day (19th June), found that while 67% of respondents had considered succession planning, only 8% had developed a documented plan for the future of their business.
The findings raise concerns for Northern Ireland’s business community, particularly as many of the respondents are long-established businesses. More than 70% of those surveyed have been operating for over ten years, yet fewer than one in ten have a formal written succession plan in place.
Employee Ownership Ireland Chair Karen Maguire said the results should serve as a timely reminder for business owners to begin planning earlier.
“While only a small sample, this snapshot survey gives us an important insight of where businesses currently stand on succession planning.
“It is encouraging that many business owners are thinking about the future. There is however, a clear gap between awareness and action. On EO day, where we celebrate the local employee owned businesses, we wanted to shine a light on this.
“While two thirds of respondents had considered succession planning, spoken to professional advisers, family members or colleagues, most are not taking the important next step of putting a formal written plan in place.
“Many of the businesses who responded have been operating successfully for more than a decade. They provide local employment, contribute to their communities and have built strong reputations. Without proper planning, there is a risk that these valuable businesses, jobs and expertise could be lost.
“Succession planning is not simply about retirement, sale or buyout. It is about protecting the future of a business, safeguarding jobs and ensuring successful companies can continue to contribute to the economy for years to come.
“What is particularly encouraging is that business owners are open to the conversation. More than half of those surveyed said they would like to learn more about employee ownership as a succession option. This shows that there is a clear appetite to explore different ways of securing the future of their businesses.”
Economy Minister Dr Caoimhe Archibald said, “Locally owned businesses are at the heart of our economy and our communities, and planning for the future is essential to protecting that strength. This research highlights a clear gap between recognising the need for succession planning and taking practical steps to put plans in place. Without that, there is a real risk to jobs, skills and long-term business resilience. That is why we are supporting fully funded feasibility studies through Employee Ownership Ireland, helping businesses to plan ahead, explore their options and secure a sustainable future.”
Karen Maguire continued, “This survey is intended to be the first stage of a wider programme of work. We will now be engaging with local universities and partners to undertake more detailed research into succession planning across Northern Ireland. We want to build a clearer picture of the opportunities and challenges facing business owners.”
Awareness of employee ownership was relatively high, with seven in ten respondents saying they had heard of the model. However, only a small number described themselves as being very well informed, suggesting there remains a significant opportunity to improve understanding of alternative succession options.
Employee Ownership Ireland is encouraging business owners to begin succession planning discussions well in advance of any intended transition and to explore the full range of options available to them.