“More than 50%” is the oft quoted statistic for the percentage of Canadians who do not have a valid Will. According the BDO Dunwoody/Compass Report on Canadian Family Business, a staggering 78% of business owners do not have a succession strategy for their business in place. The same report showed 92% of business owners acknowledging that it was important for them to have a plan.
While the primary reason for failing to do what they know they should do is lack of time due to current commitment with the company, another major impediment for many is the family issues landmine.
Family dynamics figure into most family business planning scenarios, but they can be particularly troublesome where blended or non-traditional families are involved. The situation may be most volatile where the business owner recognizes that the best candidate to succeed them is not their biological child, but their step-child.
Lynne Butler discusses this issue in a recent article in The Globe and Mail and offers a few suggestions for resolving the succession issue where the biological and step-children may be at odds. I’ll leave you with just one: “Appoint neither child as CEO but give each one a management role under a neutral chief executive’.
Something (else) for business owners to think about when they get around to creating that exit strategy.