Posted: 28/01/2014There are positive indications for Channel Islands' businesses as the most recent PwC Global CEO Survey has revealed a leap in UK confidence.
For PwC's 17th Annual Global CEO Survey, 1,344 interviews were conducted in 68 countries during the last quarter of 2013. By region, 445 interviews were conducted in Asia Pacific, 442 in Europe, 212 in North America, 165 in Latin America, 45 in Africa and 35 in the Middle East.
The key headlines of the survey are:
• UK CEOs are among the most confident in the world;
• Two thirds expect to increase headcount this year, yet three quarters plan to reduce costs;
• Growth expected in existing markets, but CEOs must also target new global opportunities;
• Technological advances expected to have greatest impact on businesses over next five years;
• Overregulation seen as the biggest threat to business.
"Our 2014 Global CEO Survey shows that UK CEOs are far more optimistic about growth prospects than their peers in developed economies around the world, with their views more in line with the CEOs of Asia Pacific countries. UK business leaders are now focused on revival rather than survival but the aim must be to turn this optimism into real economic growth,” said Ian Powell, UK chairman and senior partner, PwC.
Nine out of 10 (93%) UK CEOs are confident about their own company's revenue prospects over the coming 12 months, up from 78% in 2013, according to PwC's 17th Annual Global CEO Survey. UK business leaders are significantly more confident than the average global CEO and also than the vast majority of their European counterparts.
UK CEOs are more confident about the outlook for growth in the global economy than their peers almost anywhere else, with 61% thinking it will improve in the year ahead, up from just one in 10 (11%) last year.
Rising confidence is reflected by a strengthening outlook for jobs.
Some two thirds of UK CEOs (65%) plan to increase headcount in their business this year, up from 45% in 2013, and considerably higher than the global average of 50%. Only business leaders in Taiwan, Korea and the Middle East are more likely to recruit.
Optimism about growth opportunities is high, yet challenges remain around successfully gearing up to exploit them. While most UK business leaders aim to increase jobs, almost three-quarters of UK CEOs also intend to implement further cost reductions in the coming year.
It appears the shift to a growth agenda does not mark the end of austerity for businesses.
UK CEOs see product and service innovation (48%) as the top way to grow their business over the next 12 months, followed by increasing their market share in existing markets (25%), M&A (16%), and then joint ventures or strategic alliances (16%). Only 5% expect their main growth in the year ahead to come from new geographic markets, well behind the 14% of CEOs worldwide who expect growth to come from new export markets.
Turning to the forces that will drive change in their businesses in the coming years, UK CEOs think the disruptive effects of technology have much further to run. 82% rate technological advances as having the greatest impact on their business over the next five years, followed by shifts in economic power (64%) and demographic changes (57%).
57% of UK CEOs say they intend to respond to technological challenges by using data management and analytics, 55% by applying talent, and 53% with technology investments. Most are already making strategic changes to support these areas, with 87% currently engaged in updating their talent strategy (up from 83% last year) and 80% revamping their technology investment plans.
Regulation remains a bone of contention for CEOs, not least in the UK. Asked to name the biggest threats to their business, 77% of UK CEOs (against 72% globally) highlight the risk of overregulation. And to improve businesses' experience of regulation, UK leaders call for regulation that focuses on outcomes rather than processes (57%), a reduction in the total number of regulations (55%), and regulations that are clear and designed for long term (50%).
This marked boost in optimism among UK CEOs is good news for businesses in Jersey and Guernsey, according to PwC in the Channel Islands.
Karl Hairon, Partner at PwC CI, said: 'Although the survey results are based on responses from Global CEOs, our experience is that many of the messages from the survey are relevant to CI business leaders who face similar challenges and have similar opportunities to international firms. The results of the survey are essential reading for all senior staff concerned with strategic direction , profitability, performance and day to day financial management.'
The full survey report with supporting graphics and broadcast quality footage can be downloaded at press.pwc.com. Video clips from the CEO survey press launch in Davos will also be available after the event.