Chief executives of companies around the world are planning to cut operating costs as nearly three-quarters of them anticipate a decline in global economic growth over the next 12 months, according to a recent survey by PwC.
The 26th Annual Global CEO Survey by consulting firm PwC found 73% of 4,410 chief executives from 105 countries and territories were not confident about growth prospects for the global economy, with 40% believing their companies will not be economically viable in a decade.
Executives' confidence in their own company's growth prospects also dropped significantly (-26%), the biggest decline since the 2008-2009 financial crisis, when a 58% decline was recorded, according to the study conducted during October and November 2022.
Leaders in the US, Brazil, India and China are more optimistic about domestic growth than global growth, compared with those in France, Germany and the UK, which are weighed down by an ongoing energy crisis.
Unlike the 2022 edition where the top concerns were cyber and health risks, the executives shared different opinions this year with regards to the impact of the economic downturn.
The study found chief executives have concerns about inflation and economic volatility, measured at 40% and 31% respectively, for the next 12 months as well as the next five years.
Some 25% of respondents said geopolitical conflict risks made them feel financially exposed.
"A volatile economy, decades-high inflation and geopolitical conflict have contributed to a level of CEO pessimism not seen in over a decade," said PwC global chairman Bob Moritz.
In response to the economic atmosphere, more than half of CEOs are looking to cut operating costs, whereas 51% aim to raise prices and 48% diversify their product and service offerings to stimulate revenue growth.
Despite the anticipated slow economic expansion, 60% of respondents said they would not reduce workforce size in the next 12 months, according to the survey.
"For organisations to not only thrive but also survive over the next few years, they must carefully balance the dual imperative of mitigating short-term risks and operational demands with long-term outcomes, as businesses that don't transform won't be viable," said Mr Moritz.
