By Ed Frankl
Almost half of business leaders don’t believe their companies will be viable in a decade due to the acceleration of AI technology and worsening climate concerns, despite improved optimism about the economy, according to a survey of CEOs.
The proportion of chief executives concerned about their businesses’ long-term viability if they continue on their current path rose to 45%, from 39% in 2023, according to PricewaterhouseCoopers’s Annual Global CEO Survey published Monday for the World Economic Forum in Davos.
However, CEOs are now more than twice as confident in the state of the economy, with 38% optimistic about global economic growth prospects over the next 12 months, up from 18% at this point last year. This comes as concerns from inflation and macroeconomic volatility fell, PwC said.
Small company chiefs are more likely than their counterparts at larger businesses to feel their company’s viability threatened, the survey said.
“As business leaders are becoming less concerned about macroeconomic challenges, they are becoming more focused on disruptive forces within their industries,” said Bob Moritz, global chairman of PwC.
“Whether it is accelerating the rollout of generative AI or building their business to address the challenges and opportunities of the climate transition, this is a year of transformation,” he added.
Of the 4,702 CEOs across 105 countries who took part in the survey, around 70% expect generative AI to change the way their company creates value in the next three years, PwC said.
But generally, AI is seen having a positive effect, with almost 60% expecting it to improve the quality of their products or services.
However, business heads are also a little less confident than last year in their own company’s prospects for revenue growth, ticking down to 37% from 42%.
While in most regions of the world CEOs hold positive outlooks, in the more developed markets of North America and Europe there is greater pessimism, the survey said.
Climate change is also an increasing issue for businesses, with nearly one-third expecting the climate transition to change how it delivers its products or creates value in the next three years. Less than one-quarter said the same regarding the past five years, PwC said.
“This year’s data suggests a high degree of CEO uncertainty ahead, but CEOs are taking action. They are transforming their business models, investing in technology and their people, and managing the risks and opportunities presented by the climate transition,” Moritz said.
Write to Ed Frankl at [email protected]
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