Only 9% of IFA firms are treating succession planning as a "central part" of their business strategy, according to a new report.

A third (36%) of IFAs planning to retire within 10 years have given ‘little or no thought’ to planning for their exit, according to a survey by network ValidPath.

While 77% of those surveyed believed that having a succession plan was important, only a third (31%) considered it vital.

A quarter of respondents (23%) did not see succession planning as a priority for their business.

Nearly six in 10 (57%) of the advisers surveyed said that five years or less was a sufficient timeframe to plan for their exit.

Angus MacNee, CEO of ValidPath, said too many IFAs were delaying succession planning, potentially risking the ideal exit for both themselves and their clients.

He said: “These findings highlight the gap between recognising the importance of planning for your exit and actually taking meaningful action.

“The good news is that most IFAs understand why succession planning is important, but only 9% currently treat it as a central part of their strategy. This obviously means that the overwhelming majority of IFAs (91%) are not being strategic with their approach to creating and realising value or indeed executing a plan to optimise their business potential.”

The report also found that when planning for their exit, the top three outcomes that IFAs were primarily focused on were ensuring a smooth transition for their clients, securing the financial outcome they need from the process and maintaining their firm’s independence.

• ValidPath surveyed 65 IFAs between 7 and 26 February.