Posthaste: Family business owners are rushing to hand over their companies
Many Canadian family business owners are accelerating the handover of their companies under pressure from a changing economic landscape and internal family dynamics, according to a new study by KPMG LLP in Canada.
The survey of 285 leaders of 700 small- and medium-sized family businesses found that 79 per cent are speeding up their succession plans, with 73 per cent expecting to transition to new leadership within the next three to five years.
Most of them (79 per cent) are accelerating their succession plans for multiple reasons, including a constantly changing business and economic landscape, disruptive technologies, climate realities, tax changes and complex family dynamics.
“As a generation of family business founders and owners decide whether or not to step down as CEO, difficult decisions about what should happen to the business, next-generation readiness and how best to preserve family wealth and legacy all need to be carefully examined,” Yannick Archambault, partner, national leader, KPMG Family Office, said in a press release.
Seven in 10 leaders (71 per cent) already have a formal plan in place to ensure the continuity of their business, 19 per cent have a plan that isn’t detailed and six per cent don’t have a plan but say it’s understood who in the family will take over the business.
“Successful families that take a multidisciplinary approach to addressing emerging challenges and have been proactively preparing the business, their family and their successors will be in a better position to choose the optimal path forward,” Archambault said.
Many owners who are hoping to transfer their businesses within the family have established a timeline based on new tax legislation introduced in the 2023 federal budget,
Read more on financialpost.com
