Fewer than half of Scotland’s CEOs believe the talent to succeed them exists within their current organisation, according to new research.

The findings emerged from a survey of more than 120 CEOs and senior leaders in Scotland as part of a research partnership between Glasgow-based executive search specialist Livingston James Group, and professional services frim EY UK, aimed at identifying the skills required to be a CEO of the future.

The same questions were also posed to other senior leaders and potential CEOs heading up departments including finance (CFOs), operations (COOs), technology (CIOs), human resources (CHROs), and non-executive directors and chairs (NEDs) across the public and private sectors.

Just 47% of the CEOs surveyed said they could see anybody in their current leadership team as potential future CEOs of theirs, or another organisation, while more than half (56%) of the functional leaders responding to the survey believed they have the potential to take the top job in future.

“With more than 50% of current CEOs believing the talent to succeed them doesn’t exist within their organisations, investing in proactive, long-term succession planning for the C-Suite and C minus one roles is paramount, identifying leaders with potential early on in their careers, ensuring a motivational career path for the best talent whilst focusing on nurturing and attracting more diverse talent pools to potentially become future CEOs,” Alistair Shaw, director at Livingston James Group said.

The research – a blend of surveys and interviews – also asked respondents to identify key challenges and priorities going forward, and what they believe the CEO of the future will look like.

Participants said integrating AI into their business, keeping on top of tech regulation and compliance, risks associated with cybersecurity, and attracting and developing tech-focused talent amid significant skills shortages were amongst the key issues ‘keeping them awake at night’.

“While the role of a CEO has always been demanding, contemporary challenges such as AI, ESG and increased stakeholder expectations may contribute to an overall perception that the job is becoming more difficult,” Tricia Nelson, consulting leader at EY Scotland said.

Aside from technology, participants singled out a need to improve workplace culture and diversity as a key challenge, alongside balancing profitability with improving long-term values including ESG.

CEOs overwhelmingly named improving customer value proposition (CVP) as their number one priority (100%), while CFOs, COOs, and CCOs favoured employer value proposition over CVP. The HR leaders placed ESG as the top priority.

Asked for the top attributes CEOs will need to succeed in future, 100% of CEOs identified resilience as the most important, as did CCOs and COOs. High emotional intelligence also ranked highly with CEOs – with 80% naming it a top trait. Only CHROs (100%) picked out humility as the top attribute in a future leader.

“It’s also clear those softer, intangible, human attributes – voice, vision, resilience, and the ability to innate ability to bring the technical skills of others together – remain essential to leaders of the present and future,” Shaw said.

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The study also asked CEOs to identify the most important characteristics for the role of a future CEO, with being a ‘transformational leader’, ‘being the face and voice of the organisation’, and ‘setting the tone’ the top three responses.

“Organisations with a clear and meaningful purpose tend to attract and retain talent more effectively, and consumers and investors are placing greater importance on corporate social responsibility and ethical practices,” Shaw said.

“CEOs adopting purpose-driven leadership styles align well with these expectations, contributing to enhanced reputation and brand value.”

Nelson added: “Developing the future CEO, with the new required qualities and an increased focus on emerging internal talent, is a critical responsibility of the Chair and Board.

“By operating in Scotland, they already have a massive recruitment advantage – the business community plays on an international field but is effectively networked into the strong local ecosystem of education, industry and government which, in turn, attracts a truly global C-Suite talent pool.

“Fostering and building on the competitive advantage, along with a passion for innovation, will mean organisations can do what they do best with a local footprint in a global market.”