Global executives are increasingly apprehensive about the long-term sustainability of their businesses, according to a recent survey conducted by PricewaterhouseCoopers (PwC). The survey, conducted before the Davos summit, reveals that 45% of over 4,700 CEOs worldwide believe their businesses may not survive the next decade without significant changes. While some express optimism, most fear mounting pressures from generative artificial intelligence (AI) and climate disruption.
Generative AI looms large on the horizon
The survey’s most prominent concern among CEOs is the rapid advancement of generative artificial intelligence. Approximately 75% of respondents anticipate significant changes in their businesses within the next three years due to the impact of AI. While acknowledging AI’s potential benefits, many CEOs are also concerned about the need for their employees to acquire new skills and the potential risks of cybersecurity breaches, misinformation, and bias affecting both customers and employees.
Juergen Mueller, SAP’s Chief Technology Officer, highlighted the impending impact on employment, stating, “If you just look at the same skills, I think yes, there will be an impact. Therefore, what you do need is even better-skilled people.”
Environmental Concerns Impacting Margins
Another critical aspect of the survey underscores the increasing emphasis on environmental concerns within the business landscape. Four in ten executives are willing to accept lower investment returns in favor of climate-friendly initiatives. However, less than half reported progress in addressing climate risks in their financial planning. A concerning 31% of respondents indicated they had no plans to address climate risks.
Despite concerns, the survey paints a somewhat optimistic picture of global economic growth. 38% of CEOs expressed optimism about growth, a substantial increase compared to the previous year. However, there is less confidence in revenue growth over the next year, with only 37% of CEOs believing in their ability to increase revenue, down from 42% in the previous year.
Changing investment preferences
Britain emerges as the top destination for investment, with nearly a third of U.S. CEOs considering it their primary target. This preference signifies Britain’s enduring appeal to investors. However, it’s worth noting that Britain’s strategic importance for global CEOs has slightly waned, falling fourth place behind Germany, the U.S., and China. Despite this decline in ranking, Britain remains an attractive investment option.
The survey by PwC reveals a nuanced perspective among global CEOs. While some express confidence in their businesses’ adaptability, a significant portion acknowledges the need for substantial changes to ensure long-term viability. The impending impact of generative AI, coupled with growing environmental concerns, has prompted a reevaluation of strategies and priorities.
Business leaders recognize that success in this evolving landscape requires not only embracing new technologies but also fostering a workforce equipped with the skills necessary to navigate future challenges. Moreover, the commitment to addressing climate risks and promoting sustainability is becoming increasingly crucial for businesses looking to thrive in the years ahead.
As CEOs gather at the annual World Economic Forum in Davos, the survey results are a stark reminder of the dynamic and ever-changing nature of the global business environment. In an era of rapid technological advancement and heightened environmental awareness, adaptability and innovation will be the cornerstones of enduring success. The path forward for businesses will undoubtedly involve navigating the complexities of AI and the imperative of addressing climate change, all while striving to achieve sustained growth and profitability.
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