The issue of regulation is exercising the minds of global chief executives (CEOs), which has overtaken economic concerns for the first time according to PwC.
The professional services and auditing giant issued its
Annual Global CEO Survey
to coincide with this week’s Davos Economic Forum in Switzerland. The survey was compiled following interviews with 1,344 CEOs across 68 countries during the last quarter of 2013.
Out of this total, 72% of respondents expressed their concerns over the potential impact of regulation on business, the first time the issue has ranked above economic concerns.
The research was introduced by Dennis Nally, chairman of PricewaterhouseCoopers International, who said that it showed an overall return of confidence about the global economy. Forty-four per cent of CEOs expect conditions to improve over the next year, against only 18% in last year’s survey. Only 7% forecast economic decline in the year ahead, whereas 28% expressed pessimism last year.
Nally said that CEOs had “successfully guided their companies through recession” and more now felt positive about their ability to increase revenues as well as prospects for the global economy.
Conversely, improving economic prospects saw 63% of global CEOs express concern about being able to recruit the right people and having them in the right roles. The figure marks the highest proportion since PwC started tracking the trend in 2009, when just 49% of CEOs expressed this concern.
CEOs were also bullish when it came to prospects for their own businesses. Nearly 40% said they were ‘very confident’ of revenue growth prospects for the coming 12 months, up from 36% last year. Overall, 85% said they were ‘somewhat’ or ‘very’ confident about their own company’s prospects.
However, the report shows that while confidence is rising among business leaders from advanced economies such as the US, the UK and Japan – and mirrors recent recoveries enjoyed by each country – the picture for leaders in emerging economies is muted at best. Optimism across western Europe has jumped to 30% from only 8% last year, but in Africa, Latin America and parts of eastern and central Europe, confidence has slipped.
“CEOs also acknowledge that generating sustained growth in the post-crisis economy remains a challenge, especially as they deal with changing conditions like slowing growth in the emerging markets,” said Nally.
“For the future, CEOs tell us that they expect three major global trends – rapid technological advances, demographic changes and shifts in economic power – will have a major impact on the future of their businesses. Finding ways of turning these global trends to their advantage will be the key to future success.”
At the country level, the report found that the highest level of CEO confidence was in Russia (53%), followed by Mexico (51%). In the US, 36% of business leaders expressed high confidence in their ability to achieve revenue growth this year compared to 30% of those surveyed for 2013.
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