Technology and climate pressures are creating resilience challenges for organizations and 45% of CEOs surveyed for PwC’s 27th annual Global CEO Survey do not believe their business will be viable in a decade without reinvention. This is up from 39% in 2023 and provides a strong illustration of why the capability to adapt is a vital aspect of organizational resilience.
The Annual Global CEO Survey interviewed 4,702 CEOs across 105 countries and territories, found short-term optimism, with 38% of CEOs positive about global economic growth prospects over the next 12-months, up from 18% in 2023. CEO expectations of economic decline have tumbled from a record high in last year’s survey (73%) to 45%, as perceived exposure to inflation and macroeconomic volatility fell by 16 percentage points (to 24%) and 7 percentage points (to 24%) respectively. Despite ongoing conflicts, the proportion of CEOs who felt their company is highly or extremely exposed to geopolitical conflict risk fell 7 percentage points (to 18%).
However, when looking further ahead CEOs are concerned about the growing challenges as various megatrends, including technological disruption and the climate transition, converge. As highlighted above, almost half of CEOs say they do not believe their current business will be viable in a decade if it continues on its current path.
As business leaders are becoming less concerned about macroeconomic challenges, they are becoming more focused on disruptive forces within their industries. Despite rising optimism about the global economy, they are actually less optimistic than last year about their own revenue prospects, and more acutely aware of the need for fundamental reinvention of their business.
Bob Moritz, Global Chair, PwC
AI’s role in reinvention and adaptation
CEOs overwhelmingly see generative AI as a catalyst for reinvention that will power efficiency, innovation, and transformational change. Nearly three-quarters (70%) believe it will significantly change the way their company creates, delivers, and captures value in the next three years.
CEOs are also optimistic about the short-term impact. Over the next 12 months, almost three-fifths (58%) expect it to improve the quality of their products or services and almost half (48%) say it will enhance their ability to build trust with stakeholders. They also expect better outcomes for their business – 41% expect it to positively impact revenue and 46% expect it to positively impact profitability. The technology, media and communications sector is most positive about the impact on profit (54%), while energy, utilities and resources are least optimistic (36%).
But while CEOs are increasingly looking to the transformative benefits of generative AI, the great majority say it will require workforce upskilling (69%). They have also expressed concern about an associated rise in cyber security risk (64%), misinformation (52%), legal liabilities and reputation risks (46%), and bias towards specific groups of customers or employees (34%) in their companies.
