LONDON — A growing number of executives are feeling good about the global economy, but believe their companies won’t survive the next decade without a major overhaul due to pressures from climate change and technologies such as artificial intelligence. A new survey reveals that an increasing number of business owners are thinking about this. CEO of PwC, the world’s largest consulting company.
As business elites, political leaders and activists gathered at the World Economic Forum’s annual meeting in Davos, Switzerland, a survey of more than 4,700 CEOs from around the world was released on Monday to predict the coming years. A complex situation was presented.
Thirty-eight percent of executives are optimistic about the strength of the economy, up from 18% last year, when the world was mired in a quagmire of high inflation, low growth and rising interest rates.
The PwC Global CEO Survey found that 45% of CEOs expected an economic decline, down from a record high of 73% last year, and fewer believed their companies were at greater risk of geopolitical conflict. This is despite wars in Ukraine and the Middle East, including disruptions to global trade caused by attacks on commercial ships in the Red Sea by Yemen’s Houthi rebels.
Although the economic outlook has improved, the challenge is far from over, with the World Bank announcing last week that it expects the global economy to slow for the third consecutive year in 2024.
Meanwhile, executives have worsened the outlook for their companies’ ability to weather major changes. The survey found that 45% of respondents fear their business won’t be viable in 10 years without reinvention, up from 39% last year.
CEOs say they are trying to make changes but face regulations and a lack of skills among their employees.
“Whether it’s accelerating the deployment of generative AI or building a business that addresses the challenges and opportunities of climate change, this is a year of transformation,” said Bob Moritz, Global Chairman of PwC (formerly PricewaterhouseCoopers). ” said in a statement. .
Artificial intelligence was seen both as a means to streamline business operations and as a weakness. According to PwC, nearly three-quarters of executives said that “the way their company creates, delivers, and captures value will change significantly over the next three years.”
More than half of CEOs said AI would improve their companies’ products and services, but 69% of employees said they needed training to gain the skills to use the technology being developed. They were also concerned about how AI could increase cybersecurity risks and misinformation.
Davos organizers last week warned that the threat posed by AI-powered misinformation, including the creation of synthetic content, is the world’s biggest near-term threat.
Another global study, the Edelman Trust Barometer, released by public relations firm Edelman around Davos, found that innovation is poorly managed, polarized, and right-leaning beliefs are growing, especially in Western democracies. People with a left are far more likely to be polarized than leftists. Resist innovation.
“Innovation is being embraced because we’re looking at the big picture of how work cares for people as it changes, how scientists speak directly to people and help them understand it. Only if you have sentience,” CEO Richard Edelman told The Associated Press on Monday. “And the last thing is, in some ways, AI is affordable and it makes people’s lives easier.”
The online survey, which once again shows that companies are the most trusted institutions among governments, media, science and non-governmental organizations, has Responses were collected from over 2,000 respondents.
Similar to AI, PwC research shows that climate change is both an opportunity and a risk. A growing number of CEOs say nearly a third say they expect climate change to change the way their companies do things over the next three years.
More than three-quarters of executives said they had initiated or completed changes to improve energy efficiency, but only 45% said they had made progress in considering climate risks in financial planning.
PwC’s survey surveyed 4,702 CEOs from 105 countries and regions and was conducted from October 2nd to November 10th.
___
Masha Macpherson and David Keyton contributed to this report from Davos, Switzerland.