UK business owners feel it is important to keep the business in the family and preserve its legacy, but many lack succession plans to achieve this, HSBC Global Private Banking has found.

More than eight in 10 (82 per cent) UK business owners highlighted the importance of keeping the company in the family, according to HSBC Global Private Banking’s Global Entrepreneurial Wealth Report 2024.

However, 40 per cent of UK entrepreneurs have not started to plan for their succession or have no solid plan in place.

The UK fared better than its global counterparts on succession planning however, with 52 per cent of global business owners not having started a plan or having a solid plan in place, despite 78 per cent wanting to keep the company in the family.

Furthermore, while 82 per cent of global entrepreneurs said they felt confident that the next generation will be able to manage the family’s wealth, only 26 per cent had started conversations about wealth transfer.

However, 39 per cent said that they planned to start discussing wealth transfer in the near future, but HSBC Global Private Banking noted that this “may simply reflect the sort of good intentions we all have”.

Looking at the UK, a slightly higher proportion (30 per cent) of business owners had already started discussions about wealth transfer.

Globally, only 12 per cent of entrepreneurs have a full exit plan in place, 19 per cent have started one but not finalised it, and 66 per cent have not made any plans yet.

Around 80 per cent of multi-generational business owners said they felt trusted to take over their family company, were proud to do so and were supported by their families.

However, half of multi-generational entrepreneurs had some misgivings, with 52 per cent saying that taking on a family business was very stressful, 50 per cent stating it had held them back from their own professional goals, and 50 per cent saying they were expected to take on the business and this meant doing their own thing was not an option.

“It’s often a double-edged sword when it comes to passing on the business to the next generation,” commented HSBC Global Private Banking managing director, UHNW, Christo Scott.

“Entrepreneurs want their children to enjoy the journey and successes that they have had, but are acutely aware of the challenges that come with it and the personal sacrifices they will need to make.”

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