However, despite the negative impact on the company only a third have a CEO succession plan in place.

Almost half of UK companies have experienced an unexpected change in leadership in the last 12 months with some stating a detrimental effect on business, new research shows. Almost 1 in 5 said that it had caused a loss of or slowed growth due to a lack of leadership or direction. Almost a third cited that it had led to a decrease in morale at the company.

Roughly half of those surveyed by SHL said the unexpected change in leadership had a negative impact on employees and company growth. However, only a third admitted they have a CEO succession plan in place, despite a similar number of organisations claiming it takes six months or more to replace their CEO.

Seemingly, organisations are focusing their attention on identifying critical roles (88%) and succession plans across the company (85%) over those for the CEO.

The survey findings also indicate that HR leaders are understanding that succession planning needs to be in place across the organisation – with almost half those surveyed having succession plans for technical experts or specialists and for junior managers.

23 per cent of those polled also had succession plans in place for graduates, showing over 1 in 5 are favouring a ‘grow your own’ leadership recruitment strategy, by ring-fencing and nurturing high potential graduates from an early stage.

One reason why HR leaders may be focused on identifying high potential talent from lower down the organisation for their leadership pipeline is because according to SHL’s Talent Analytics data, they have more leadership potential than their bosses. The data reveals that 1 in 12 of those occupying a more junior role in an organisation have stronger talent to be an effective leader than those more senior to them.