ASIC’s recent media release on 28 April 2025, on Australian insolvency statistics, highlighted a 39% increase in companies entering administration between FY23 and FY24, and a 40% increase in the first nine months of FY25 compared to FY24. These are statistics that any business owner, shareholder or senior manager should take note of.

It is no secret that being geared for survival and success requires business owners to think and plan beyond the ‘now’. For instance, they should be thinking at least 12–18 months ahead. As part of this, it is imperative that they embrace a holistic approach to planning, monitoring and managing their businesses to ensure they are future-proof.

As noted in the HLB Survey of Business Leaders 2025 report, 79% of the survey respondents stated that they are working to build a “fit for future” operating model to gain extra operating speeds, cost efficiencies and market resilience. We set out below our analysis of the 4 S’ to future-proof your business.

1. Safety

Safety in business has evolved and is now a big business. It is imperative that it remains front of mind for business owners and senior management. The holistic safety (i.e., psychological, physical) safety and wellbeing of people and customers is paramount and carries civil and criminal sanctions in the event of severe non-compliance.

Businesses should ensure that they have the appropriate frameworks, applications, policies and processes in place, including at a minimum:

  • A safety-first culture which is in alignment with the organisation’s core values;
  • Legal and regulatory compliance: businesses operating across multiple states and territories will need to ensure that they are across the variations in compliance requirements;
  • Risk management: embedding a robust risk management framework to assist business owners and board members to identify and treat risks on a daily basis;
  • An effective education and monitoring framework, supported by policies and procedures, will ensure that everyone is across their roles and responsibilities in a safety-first culture workplace. It will also assist with ensuring legal and regulatory compliance.

2. Security

Similar and related to safety, security in business is multi-faceted and encompasses:

  • Cybersecurity, an ever-growing industry and it will continue to prosper. We believe that it represents one of the most real and constant threats being confronted by mankind due to the proliferation of all things IT related and how data has become a valuable commodity. All businesses have an obligation to ensure that they have appropriate processes and procedures in place to safeguard their systems and the data they are custodian of;
  • It is important that appropriate physical security measures are implemented to protect core business assets (which include its people and customers). Similar to cybersecurity, those organisations holding critical infrastructure assets are subject to additional regulatory requirements;
  • Financial security, which is related to financial sustainability, is critical to ensure that any business remains financially viable and does not suffer from theft and fraud, especially payment/procurement fraud as a result of having an ineffective or compromised cybersecurity framework.

3. Sustainability

While sustainability has many definitions, we refer to the one cited by business.gov.au:

“Being sustainable is about making positive changes in your business for the planet and people around you. It helps you stay resilient and meet the growing demand for products and services that do no harm.”

It is our contention that being sustainable also extends to being financially responsible in how sustainability measures are implemented and monitored. Equally important, in order to remain relevant in today’s business landscape, businesses will need to respond to changing stakeholder expectations and assume a higher degree of transparency and accountability required by changing regulatory and reporting requirements as applicable to sustainability and other related requirements (i.e. ESG).

We have regularly observed that a range of organisations have adopted sustainability practices as a part of their purpose and values, but many are yet to formalise it into policy that can be effectively communicated to stakeholders and the broader community.

It would be remiss not to identify the effective and intelligent use of technology as a means to driving sustainable outcomes. Tools like automation, robotics and AI are all being considered as viable means to drive sustainable outcomes.

4. Succession

Succession planning is often considered the most important element in a business plan, yet it is often the most overlooked task. It involves creating, developing and implementing a strategy to transfer ownership and/or management to the next generation of leaders within the business in an orderly manner, without compromising the financial and operational standing of the business. Key elements of any effective succession strategy entails:

  • Identifying, training, mentoring and nurturing the next generation of leaders so that they are ready and able to lead before they step up and assume the leadership responsibilities. This may entail having external facilitators involved with the mentoring element as well as looking to implement an advisory board to assist the business
  • Consideration of all applicable legislative and regulatory factors, including but not limited to: taxation considerations, including superannuation, structuring advice, estate planning
  • Stakeholder management and communication – like all things in life, proper and purposeful communication goes a long way to avoiding unnecessary confusion.

Common threads across the 4 S’

  • Alignment of missions, values and culture
  • Being prepared and willing to be analytic and strategic when planning
  • Taking and embedding a holistic approach to risk and business management will ensure that the business becomes a risk aware organisation
  • The need to invest in the business, its people, processes and its system
  • The need to have proper processes and procedures to report and monitor outcome and impacts.