MORE THAN HALF of finance directors (55%) said they have no succession planning in place.
About 200 FDs took part in the survey conducted in December 2012 by specialist finance recruitment company Robert Half.
The survey responses show that 55% admit to having no sucession planning in place. Robert Half warns that without planning, companies could face time-consuming and expensive replacement processes.
Two-thirds (39%) cited a lack of existing talent as the primary reason for their lacklustre drive to provide proper succession planning. However, this figure rises to more than half 55% for publicly listed companies.
One in four (15%) said their shortage of time to mentor and develop talent is a also a barrier, 12% claimed the lack of exposure to senior level initiatives for employees is their excuse, and 8% blamed scarcity of personal development opportunities for employees.
The main pool to recruit a successor was from outside the company, according to 40% of respondents. However, local internal promotion was an option for 26%, an international internal promotion was the choice for 23%, and an interim professional until a permanent hire would be used for 11%.
Phil Sheridan (pictured), managing director, Robert Half UK, said: “With a raft of high-profile senior resignations over the past year, it is surprising to see such a large proportion of financial directors without a chosen successor, or indeed the pool to choose from. As a result, the future continuity and performance of those businesses is at risk.
“In addition to implementing formal succession plans, employers should look at ways to help manage the process further, whether it’s offering managers with executive potential more training and development or bringing in interim employees until a permanent hire is selected.”
FDs in the Midlands are the least prepared for succession planning. An average 60% in that area have not identified a successor, followed by 58% in London and the south east, 56% in the south west and Wales and 46% in the north and Scotland.
The firm suggests companies use a structured and holistic approach to the issue and ensure they look for talent throughout the business and make succession planning part of the company’s structure.
Andrew Tyrie airs views on the Finance Bill, 'Making Tax Policy Better' report, and Brexit
After a seven-year saga, a result has been reached between Margaret May and CIMA over misconduct
Top 25 firm HW Fisher & Co has acquired London firm Rhodes & Rhodes
Top Ten firm Smith & Williamson has appointed Rupert Phelps as a partner