How to develop a business continuity and succession plan

A Business Continuity and Succession Plan is your business's "emergency brake." In the UK financial services sector, it is a regulatory requirement to have a formal arrangement in place—often called a "locum" agreement—ensuring that if you are suddenly unable to work, a qualified and regulated professional can step in immediately to protect your clients' interests and maintain compliance.

Why this is essential

If you are a solo adviser or a small firm, your clients rely on you for their financial wellbeing. If you were to fall ill or have an accident, your business could freeze, leaving clients unable to access advice or complete transactions. For the Financial Conduct Authority (FCA), "orderly wind-down" and "consumer protection" are top priorities. Having this plan isn't just about being organised; it is about meeting your professional duty of care.

Step 1: Secure a Locum Agreement

The core of your continuity plan is an agreement with another regulated firm or individual. This person must have the correct permissions to handle your specific type of business. You should establish a formal Letter of Intent or a Service Level Agreement (SLA) that outlines:

• When the agreement is triggered (e.g., after 5 days of no contact).
• The scope of their authority (can they give advice or just "hold the fort"?).
• How they will be paid for their time.
• How they will access your client files and systems.

Step 2: Map out your "Critical Functions"

List the absolute essentials that must happen for the business to stay legal and functional. Focus on the first 48 hours and the first 30 days. Use a table to keep this clear:

Function	Requirement	Urgency
Client Communication	Notify active clients of the situation and provide locum details.	High (48 Hours)
Regulatory Reporting	Ensure FCA returns (RegData) are submitted on time.	Medium (Monthly)
Professional Indemnity	Ensure PI insurance premiums are paid and the policy is active.	High (Immediate)

Step 3: Create a "Digital Vault"

Your successor cannot help if they are locked out of your computer. You must provide a secure way for your locum or a trusted family member to access:

• Your Client Relationship Management (CRM) system.
• Business bank accounts and accounting software.
• Professional Indemnity (PI) insurance policy documents.
• Compliance manuals and your FCA firm reference number (FRN).

Tip: Use a secure password manager that allows for "Emergency Access" to be granted to a specific person after a set period of inactivity.

Step 4: Formalise the Succession Plan

While continuity is about the short term, succession is about the long term. If you decide to retire or can no longer return to work, who owns the "book of business"? Your plan should state whether the business is to be sold, handed over to a partner, or wound down. This provides clarity for your family and prevents your business assets from losing value during a crisis.

Best Practices

• Review annually: Check that your locum is still in business and still willing to act for you.
• Keep it simple: Your successor will be under stress; don't make the document 100 pages long. Use bullet points and clear instructions.
• Notify your PI insurer: Ensure your insurance provider is aware of your continuity arrangements, as they may have specific requirements.