Global CEOs Express Optimism for Economic Growth but Face Challenges in Agility and Climate Investments

Nearly 60% of CEOs worldwide anticipate an improvement in global economic growth over the next 12 months, according to PwC’s 28th Annual Global CEO Survey, released during the World Economic Forum Annual Meeting. The survey, which gathered insights from 4,701 CEOs across 109 countries and territories, also revealed that 42% of business leaders plan to increase their workforce by 5% or more in the coming year—more than double the 17% who expect to reduce headcount. This figure marks an increase from last year’s 39% and is particularly high among smaller companies with revenues below $100 million (48%) and within the technology (61%), real estate (61%), private equity (52%), and pharmaceutical and life sciences (51%) sectors.

Despite their optimism regarding economic growth, CEOs identified macroeconomic volatility (29%) and inflation (27%) as the most significant risks for the year ahead, though regional variations were observed. In the Middle East (41%) and Central and Eastern Europe (34%), geopolitical conflict emerged as the top concern. Western European CEOs expressed slightly greater concern over cyber risks (27%) compared to labor shortages (25%) and inflation (24%), with macroeconomic volatility remaining the primary risk at 29%. In Africa, inflation (39%) was cited as the most pressing issue, while North America and Asia-Pacific aligned closely with the global risk outlook.

Reflecting on the sustainability of their organizations, 42% of CEOs expressed concerns that their companies would not remain viable beyond the next decade without significant transformation. Among those who held this view, regulatory shifts were cited as the most influential factor impacting their economic sustainability.

In response to these challenges, business leaders have been taking proactive measures to reshape their organizations. Across all sectors, nearly two-thirds (63%) reported undertaking at least one significant action to redefine how their companies create, deliver, and capture value over the past five years. CEOs who pursued more reinvention initiatives reported higher profit margins within the last year.

As companies explore diversification strategies, 38% of CEOs indicated that they had entered at least one new sector in the past five years, with about 34% noting that these expansions contributed over 20% of their total revenue during this period.

However, the survey highlighted that the pace of reinvention remains slow, and most organizations continue to lack agility. Approximately half of CEOs reported reallocating 10% or less of their financial and human resources annually, while more than two-thirds indicated they moved less than 20%. On average, only 7% of revenue over the past five years was generated from entirely new business ventures.

Amid ongoing climate-related challenges, CEOs have continued to prioritize sustainability efforts. The survey found that climate-related investments were six times more likely to have increased revenue (33%) than decreased it (5%). Additionally, nearly two-thirds of respondents stated that such investments had either reduced costs or had no significant impact on their expenses.

Despite these positive outcomes, hurdles remain in advancing climate-related initiatives. CEOs who had made such investments cited regulatory complexity (24%) as the most significant barrier, followed by concerns over lower returns on investment (18%) and a lack of support from management or the board (6%).

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