CEOs are optimistic all over the world

Between August and November 2017 PwC interviewed 1,293 CEOs in 85 countries, within the framework of the company’s 21st Global CEO Survey. Results were revealed at the World Economic Forum in Davos and show that the proportion of optimistic CEOs reached a record level: 57 percent of CEOs reckon that global economic growth will speed up in the next 12 months. Last year this proportion was only 29 percent – this is the biggest growth since 2012. Nick Kós, the CEO of PwC Hungary is very optimistic about Hungary’s economic growth. He added that the results of the survey’s Hungarian leg are going to be published in March.

Nick Kós
CEO
PwC Magyarország

The general optimism about the economic situation also manifests in the expectations of CEOs about the performance of their own companies, however, in this domain the increase from last year is smaller: 42 percent of CEOs said they are ‘very hopeful’ about their own companies’ sales growing in the next 12 months – last year 38 percent was measured. Growth strategies are pretty much the same as last year, CEOs plan to rely on organic growth (79 percent), cost cutting (62 percent), engaging in strategic cooperation (49 percent), and mergers and acquisitions (42 percent). In the ranking of the most attractive markets Germany kept its third place, followed by the United Kingdom in the fourth position and India finishing ahead of Japan as fifth.

In 2018 54 percent of CEOs intend to recruit new workers (back in 2017 this proportion was 52 percent) and only 18 percent will make employees redundant. 22 percent of CEOs are afraid that workers won’t have the necessary digital skills; 27 percent and 23 percent worry that these skills won’t be available at industry and managerial levels. The best strategy for companies is to invest in a modern work environment, training and education, and in cooperating with other service providers to attract workers that have the necessary digital skills. Two thirds of CEOs believe that they are responsible for retraining those employees whose jobs have been taken away by some kind of new technology, especially in the machine industry and in building/construction (73 percent), plus in the technology (71 percent) and communication (77 percent) sectors.

Despite the optimism as regards economic growth at world level, there are growing concerns about a growing number of business, social and economic factors. CEOs complained about geopolitical instability (40 percent), online threats (40 percent), terrorism (41 percent), lack of experts (38 percent) and populism (35 percent), saying they are ‘very much afraid’ of these. However, CEOs are still the most afraid of overregulation (42 percent) and 36 percent are annoyed by growing taxes.

According to Bob Moritz, global chairman of PwC, irrespective of country or region, the CEOs interviewed as part of the survey have realised the fact that measuring growth and profit can’t be done the way it used to be any more. This is especially true for sustainable development goals, as in the case of these more efforts will have to be made to come up with index numbers which can really grasp to what extent the targets of a business have been reached. As for the main challenges that affect the trust in enterprises, CEOs are of the opinion that the most important one is less time available for achieving the desired results (60 percent). What is more, 59 percent reported growing pressure in the field of CEO’s personal accountability, e.g. because of breaking the rules. //