Most Scottish company heads (54%) plan to remain at the helm and hand over only the daily management of their business, either to a candidate from the wider industry (32%) or to an employee already working in the firm (22%). Just under a third (29%) have a family member in mind to take over when they step down.

Meanwhile, one in ten (12%) will make a clean break on retirement, with a plan to sell and exit the business. Of that group, many have plans for what to do with the money they release.

Re-investing is one of the biggest priorities, as just under half (42%) will invest the money they make from any sale into the stock market and over a third (35%) will look to invest in property.

Sharing their good fortune features almost as highly, with just under a third (31%) planning to donate a portion of their windfall to charity. One in four (25%) are focused on pension planning and will use the lump sum as income instead of drawing down from their pension.

According to the report, one in five (21%) will use the money as capital to start another company.

That the entrepreneurial spirit remains strong, even post-retirement, is welcome news for the Scottish economy, which benefits from its wealth creation, innovation and new market development.

Local entrepreneurs should be encouraged by the finding that one in four (26%) High Net Worth (HNW) individuals and business owners in Scotland are pre-disposed to investing in other Scottish businesses. Pride among the business community has been bolstered by the global success stories of local start-ups like Skyscanner, and four in ten (41%) involved in the research said that Scottish business success had been the biggest source of pride for them in recent years.

Angus Kerr, head of Scotland at Rathbones, commented: “It’s encouraging to note that only 3% of Scottish business owners don’t have an exit plan for their business. Succession planning is rarely urgent, but it is always important, and continuity and contingency planning is particularly critical while markets remain changeable and skills shortages are appearing. The last thing any successful leader wants to see is all their efforts go to waste, and by mentoring individuals and solidifying structures and ways of working, that risk can be largely mitigated.”

Angus Kerr has also shared his top tips for those thinking about succession planning:

Don’t leave it late

The further in the future you’re looking ahead, the less intimidating the idea of succession is to any current employee, outsider incumbent, or family member. Plenty of time is needed to assess whether there are any gaps in skills, values and vision between you and the person you’re lining up to take over.

Don’t be too focussed on the past

The trick is to strike a balance between not throwing out what makes the company work as well as it does and leaving room for someone to take the company forward and exploit new opportunities and respond to new contexts.

Seek external counsel

An objective view can help you depersonalise the choices involved in succession planning – and think in terms of the qualities and skills needed rather than the personalities involved.