BY JOHN ELLIS, FINANCIAL ADVISOR
Many Irish family-owned businesses are heading for a crisis of their own making. According to the new IFAC Family Business Report 2026, 61% have no succession plan in place at all. Even worse is that 44% say the issue is not even on their agenda.
Yet, 77% of owners admit all their personal wealth is entirely or mostly tied up in their business. As many approach retirement, they are risking decades of hard work, including their families’ futures, on the hope that everything will somehow work itself out over time.
James Farrell, Head of SME at IFAC, has seen this story play out too many times. “Conversations around succession are often difficult, because these businesses are deeply personal,” he says. “In many cases, they represent decades of work and sacrifice, but delaying those discussions usually limits options later. The businesses that tend to transition most successfully are the ones that start planning earlier, put proper structures in place and take a long-term view.”
The risks are real, according to the report. It found one in three family businesses has already suffered a dispute that affected decision-making, and in 13% of cases it had a major impact on the company. When the ‘family silver’ is tied up inside the business, fairness is out the door. Not every child wants to take over the family business, but how are the siblings outside the business to be taken care of? The problem is that in many situations 90% of the family assets are wrapped up in the business. Selling may actually be the fairest option.
Stephen Gahan at Forvis Mazars points to the founder’s personality as another hidden trap. “The founder of any business is typically a strong character with a clear, entrepreneurial spirit. That is what drives them forward. But that is also what can make it extremely hard for them to let go.”
Too many owners wait for a health scare or an unsolicited offer before they act. By then, valuable tax reliefs can be lost and family relationships may have already soured. Retirement Relief, for example, can wipe out Capital Gains Tax on a transfer to the next generation, but only if the structure is right and the timing is early. Delaying also increases exposure under the Fair Deal scheme too.
The wider picture in the IFAC report is less than encouraging. Only one in three family businesses are optimistic about the next 12 months. Profitability and rising costs dominate. Two in three firms plan to maintain current investment levels, while three quarters expect no change in staff numbers. Two in five owners are even considering selling within five years. Yet the same report shows just two in three still operate in a purely informal, family-led way with little or no advice sought from outside experts.
But simple tools can be put in place easily. For instance, one expert recommends a family constitution. This is a living document that sets out shared values, rules on succession, decision-making and roles. “They tend to be drafted as a set of values or principles to which family members adhere,” he explains. Strong shareholder agreements can also take the guesswork out of ownership, dividends and what happens if someone wants to exit, divorces or dies unexpectedly.
The nightmare scenario is parents, children and the business all losing because no one talked openly. Partial exits or family partnerships can sometimes keep everyone on board without handing over day-to-day control.
The message from the report and every expert who works with these firms is the same. Now is the time to act, while things are still running smoothly. Waiting until the bridge is on fire is no way to protect what you spent a lifetime building. Ireland’s family businesses are the backbone of our economy and our communities.
They deserve better than to drift into problems that could have been avoided. The ones that will survive into the future are the ones that start the hard conversations today.
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