Large corporations and entities operate like machines: they are established and work out long-term plans to continue their growth through changes in leadership. For massive businesses, the turnover of a leader may mean little to its daily operations. However, when a New York business owner begins to think about retirement, they may have many questions about what will happen with their enterprise.
This post addresses some of the steps that business owners can take to protect their businesses through the succession process. The contents of this post should not be read as legal advice, and all questions regarding business succession and other business law matters should be taken to trusted New York attorneys.
What is business succession?
Just as governments have plans for the changeover of leaders, businesses also set up succession plans to ensure that operations continue even when one chief exits. A business succession plan anticipates what criteria a new leader may have to meet to be considered for succession, and what training and support they may require to take on their new role.
Business successions often take time to execute, and therefore a good succession plan may set forth a timetable for completing the steps of the plan. The timetable should include all matters that must be addressed before the exiting leader departs. The succession plan can also include any interests or authority the departing leader may have over the business after their exit.
How does a business make a succession plan?
Every business and business owner has different intentions and desires for the future of their entity. It is impossible to craft a single succession plan that meets the needs of all businesses. When an owner reaches the point when they are prepared to start removing themselves from their entity, they can contact their trusted business law attorney for advice and guidance.