For many business leaders, succession planning is not a distant concern – it is a current priority. In fact, a recent survey of leaders of New England middle market companies shows that 85% have a formal succession plan in place and 16% have enacted one*. Still, many are concerned about what happens once the transition begins – because just having a plan on paper is not enough.
The real test is whether a succession plan can preserve continuity, protect relationships, and support long-term success. Here’s what you need to know to make that a reality.
Why Succession Is About More Than Leadership Transfer
Succession planning goes beyond legal documentation or naming the next leader or owner – it is also about maintaining stability across the business.
Leaders are thinking about a range of issues, including:
- Ensuring continuity of company culture
- Maintaining employee stability
- Preserving client trust and key relationships
- Finding a successor who understands both the operational and cultural sides of the business
- Navigating financial and legal complexities, including compliance, valuation, and documentation
- Carrying forward community commitments
Even with a formal plan, transitions can falter if the business is not prepared for the people, customer, and community fundamentals that come with change. Succession is as much a continuity and leadership issue as it is a financial or legal one.
How Companies Are Navigating Transition – and What Stronger Succession Planning Looks Like
Businesses are taking different approaches depending on their goals, structure, and succession options.
Among survey respondents, the top strategies cited were:
- Phased leadership handovers (58%), which can allow for knowledge transfer, relationship continuity, and a more gradual transition of responsibility
- External advisory boards (47%), which can provide objectivity, accountability, and broader strategic input during a critical transition
- Strategic partner sales (41%), which can offer a path forward when family or internal succession is less feasible, while potentially supporting continuity and liquidity goals
The businesses navigating transition most effectively are not relying on a single tactic – they pair transition strategies with broader planning that strengthen readiness over time. This includes:
- Starting early to create a long runway for planning, development, and decision-making
- Clearly defining successor readiness expectations, including leadership capability, operational knowledge, and cultural fit
- Strengthening governance through advisory boards or other structures that improve oversight
- Coordinating advisors across banking, legal, tax, valuation, and wealth planning
- When appropriate, considering the full range of structures available to support leadership and ownership transitions, such as an ESOP
- Communicating intentionally with employees, clients, and partners about what will change — and what will remain consistent
For family-owned businesses, planning can be more complex but strong governance makes transition more workable in practice. Clearly defined decision-making structures, leadership design, and roles can help formalize strategy, add objectivity, and support continuity. This is why succession planning works best when it is treated as an ongoing business strategy – supported by governance, leadership development, and clear communication – rather than handled reactively.
“While business leaders often focus first on operations and ownership transfer, the financial and personal dimensions of succession are equally important to get right,” said Jeffrey Smith, Executive Vice President and Head of Cambridge Trust Wealth Management. “The most effective succession plans align the future of the business with the financial goals of the owner and the long-term legacy they want to create.”
Strong succession planning is not just about choosing the next leader – it is about preparing the business, stakeholders, and structure around that transition.
Closing
A succession plan may be common, but true transition readiness is harder to achieve. The businesses best positioned for the future are the ones that prepare not only for who takes over, but for how continuity will be protected along the way.
Eastern Bank understands that leadership and ownership transitions involve more than paperwork. From commercial banking solutions to broader planning conversations around governance, continuity, and long-term goals for the business and a leader’s own wealth management future, Eastern can help business owners prepare for succession with greater clarity and confidence. To learn more, contact a banker.
*Survey of 100+ middle market business owners in New England was conducted in Q4 2025. Middle market companies are defined as those with $25 million to $500 million in annual revenue.
The opinions expressed herein are those of the authors and do not necessarily reflect those of Eastern Bankshares, Inc., Eastern Bank, or any affiliated entities. Views and opinions expressed are current as of the date appearing on this material; all views and opinions herein are subject to change without notice. These views and opinions should not be construed as any specific recommendation. This material is for your private information and we are not soliciting any action based on it. The information in this content has been obtained from sources believed to be reliable but its accuracy is not guaranteed. There is neither representation nor warranty as to the accuracy of, nor liability for any decisions made based on such information.
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