The missing continuity plan: shareholder protection and business LPAs

When you review how a company is run and owned, you inevitably ask what happens if one of the owners is no longer there. It is a standard part of understanding resilience. What if a shareholder dies? What if a co-owner loses mental capacity and can no longer sign, decide, or vote? Who ends up owning their shares, and can the business keep functioning day to day?

Most owner-managed businesses have no real answer. They have a shareholders' agreement that may be silent on death, no shareholder protection to fund a buyout, and no business lasting power of attorney to keep the company operating if a key signatory is incapacitated. You will spot these gaps quickly. Fixing them is where you hand over.

The first gap is shareholder protection. If a shareholder dies, the surviving owners often want to buy the shares, but they may lack the funds, and the deceased's family may be left holding an illiquid stake or forced into a business they never wanted to run. Shareholder protection, usually life cover arranged alongside a cross-option agreement, funds an orderly buyout. Arranging and advising on that cover is regulated financial advice.

The second gap is continuity of decision-making. A business lasting power of attorney allows nominated people to act if an owner loses capacity, keeping bank mandates, contracts and payroll functioning. Drafting LPAs and the surrounding estate documents is legal work for a vetted will and estate specialist. Neither of these is consulting, and you should refer both.

• Shareholder death with no funded route to buy the shares
• A co-owner losing capacity with no authority in place to act
• A shareholders' agreement that says nothing about either event
• Personal wills that contradict how the business is meant to pass on

Your review gives you a legitimate, specific reason to raise both gaps. You are not cold-selling protection or wills; you are reporting a governance weakness you found. "If one of you died or lost capacity tomorrow, there is no funded plan and no authority in place. Sorting the protection side is regulated advice, and the legal documents are specialist estate work. I will introduce you to a vetted, regulated advice firm and a vetted estate specialist to handle each properly."

That keeps you firmly as the consultant who identified the risk and the introducer who routed it correctly. You never quote cover, draft an agreement, or advise on suitability.

Continuity planning is easy to postpone because it concerns events owners would rather not imagine. What changes the dynamic is a trusted adviser pointing to their specific company and saying, concretely, here is what would happen and here is the gap. Your governance work supplies the evidence that makes the referral urgent rather than theoretical.

These arrangements also protect the owner's family, not only the business. A funded buyout means a spouse receives value rather than an unsaleable stake; an LPA means the family is not paralysed by an incapacity crisis. The personal dimension is real, and it is exactly why regulated and legal specialists should handle it.

SmartPeer is a commission-only referral network of referrer firms. You are the introducer. You pass the protection gap to a vetted, regulated advice firm and the legal gap to a vetted estate specialist, both introductions tracked from the outset. Where an introduction leads to business, you receive a member share of the resulting fee, typically around 60 to 70 per cent for members.

The workflow respects your position. You keep doing the governance and succession review that surfaces the gaps. You refuse to draft or advise on the solutions yourself. You make two clean introductions, they are logged, and the specialists carry the regulated and legal work. The business gains a real continuity plan, and your review ends with tracked, rewarded referrals instead of unresolved findings.