The family business insights series

27% of families and 40% of family businesses are either currently undergoing or will undergo leadership succession within the next 10 years, underscoring the magnitude of generational change. However, while a large majority (89% of families, 82% of family businesses) report having some form of succession plan, only roughly half have a thorough, well-developed plan in place.

The top succession challenges are: “the next generation is insufficiently qualified or lacks experience” (35%); “difficulty identifying a suitable successor” (33%); and “current leadership is reluctant to relinquish control” (32%). This suggests a need for greater leadership development and more transparent succession planning.

Despite succession being a leading concern, full confidence in the succession preparedness of family leadership remains limited. Globally, only 48% are highly confident in current family leadership preparedness, falling to 37% for the next generation. This leaves a majority not fully confident—52% for current leadership and 63% for the next generation.

There is a notable shift towards appointing external professionals to the CEO role after succession, with the global share projected to double from 13% currently to 26% post-succession. This trend is apparent in many regions and reflects concerns about next-generation readiness within the family, their interest in joining the family business, and the escalating complexity of family business operations worldwide.

While senior family members primarily hold top leadership (69%) and governance (64%) positions, next-generation family members are especially prevalent in roles that are helping to drive change—technology (51%), philanthropy/community engagement (51%), innovation/research and development (49%), and sales/marketing (50%). These domains serve as proving grounds for their future advancement.

The next generation is poised to reshape family businesses with a marked focus on technology modernisation (42%), AI (42%), new product/service development (40%), geographic expansion (39%), and sustainability/inclusion and belonging ambitions (35%).

The leading obstacles faced by next-gen family members working in the family business include a need for organisational technological advancement (38%), developing leadership and management capabilities (37%), and staying competitive (36%).

To boost next-gen leadership readiness, family businesses are emphasising real-world, accountable development: 44% require formal roles with accountability/performance management, 43% use on-the-job training or leadership shadowing, and 40% mandate outside work experience before joining the family business.