Chief executive officers (CEOs) of top companies are more optimistic about global economic growth than last year, PwC said in its annual survey of company bosses, but the share of CEOs worried about the long-term viability of their businesses has risen to almost half amid growing tech and climate concerns.
About 38% of the 4,702 CEOs that PwC interviewed across 105 countries and territories from 2 October through 10 November said they are optimistic about global economic growth prospects this year, up from 18% last year.
Senior company executives acknowledged in PwC’s 27th Annual Global CEO Survey that rapid advancements in technology, evolving climate concerns, and other swiftly emerging global trends are compelling their organizations to adapt.
A significant majority of these leaders have reported implementing changes in their strategies for creating, delivering, and capturing value within the last five years.
As the pressure to adapt rises, PwC said more CEOs will prioritize big moves to support reinvention of not only the business model, but also the operating and technology models.
The study also showed that concerns of CEOs varied by region.
Inflation remained the top concern for CEOs in the US, for example, despite receding in terms of expected exposure for global CEOs overall.
Similarly, geopolitical threats are still among the top concerns for CEOs in Central and Eastern Europe, as well as the Middle East, despite receding for global CEOs overall.
In Western Europe, especially in France and Germany, apart from the US, CEOs are most concerned about cyber risk over the next 12 months.
In this year’s survey, CEOs expressed strong belief in the rapid adoption and significant disruptive potential of generative AI, with about half expecting it to enhance stakeholder trust and 60% foreseeing improved product or service quality within a year.
Nearly 70% anticipate that within three years, generative AI will intensify competition, necessitate business model changes, and require new workforce skills, a view bolstered by the experiences of those who have already implemented it across their companies.
More than half of the CEOs also expect the transformative technology to create efficiency benefits, by eliminating repetitive and time-consuming processes.
Though deploying generative AI may lead to efficiency benefits, these may also lead to employee reductions. A quarter of the CEOs expect their workforce to be trimmed by at least 5% this year due to generative AI. The companies may, however, offset the reductions with more fresh hirings in growth areas as revenue prospects manifest themselves.
While 14% of tech CEOs foresee a headcount reduction due to generative AI, 56% plan to increase hiring. This hiring rate is nearly 20 percentage points higher than the global average, indicating that overall, 39% of CEOs expect their company’s headcount to increase by at least 5% in the coming 12 months, the survey showed.
“Business leaders in this year’s survey recognize the urgency to reinvent their business models, the steps they have taken to transform, and what’s getting in their way,” Bob Moritz, global chair at PwC, said.