Top CEOs Betting Big On AI, Talent To Navigate Global Turbulence: KPMG

Top CEOs have shown resilience over the last decade as they have backed their businesses to prosper in the face of declining confidence in the global economy, a KPMG survey of more than 1,300 corporate leaders from across the world has found.

The KPMG CEO Outlook revealed that 72% of CEOs were confident about the direction of the world economy over the next three years, compared to 93% in 2015, when the survey was first launched. This confidence is demonstrated in CEOs' future hiring plans, with 92% saying they were looking to boost employee headcount over the next three years. This is the highest proportion since 2020.

This bullish attitude towards hiring comes despite 72% CEOs feeling more pressure than the previous year to ensure the long-term prosperity of their business. The top threats to growth now are supply chain challenges and operational issues, ahead of cybersecurity and geopolitics and political uncertainty last year. 

Behind economic uncertainty (53%), artificial intelligence (50%) is the top issue for CEOs today. Most leaders are increasing investment in innovation and technology, including AI, as a driver of growth. The majority (64%) identified AI as their top investment priority in 2024, with 63% expecting to see a return on investments within the next three to five years. 

The top three benefits of AI implementation recognised this year were increased efficiency and productivity, upskilling the workforce for future readiness and increased organisational innovation. However, 61% of CEOs also cited ethical challenges as some of the most difficult to address when implementing AI, while a lack of regulation (50%) and technical skills and capabilities (48%) were other areas of concern. 

While 76% of CEOs also believed that AI will not fundamentally impact the number of jobs in their organisation, only 38% felt their employees have the right skills to fully leverage the benefits of AI.

This year’s survey showed that a full return-to-office is likely in the near future. Of the CEOs, 83% now expect a full return-to-office within the next three years, up from 64% in 2023. A further 87% said they are likely to reward employees who make an effort to come into the office. 

Almost a third (31%) of CEOs are concerned about the lack of skilled workers. In response to a perceived talent shortage, almost 80% agreed that organisations should be investing in skills development and lifelong learning.

In 2015, CEOs ranked environmental risk as their least concerning priority risk. Today, 24% acknowledged that the main downside of failing to meet ESG expectations would be giving their competitors an edge. Around 76% of CEOs said they would be willing to divest a profitable part of the business that was damaging reputation, while 68% would take a stance on a politically or socially contentious issue. 

However, 66% admitted they are not prepared to withstand the potential scrutiny and expectations of stakeholders and shareholders when it comes to ESG, suggesting they will take action to mitigate this. For 30% of CEOs, the greatest barrier to achieving their climate ambitions is the complexity presented by the decarbonisation of their supply chain, an issue compounded by geopolitical tensions and activities impacting global trade routes. 

Younger leaders (78% of 40-49-year-olds) admitted to feeling greater pressure to ensure the long-term prosperity of their business than older leaders (68% of 60-69-year-olds). However, younger leaders also showed higher levels of confidence in navigating some of the critical issues facing their organisation.

While they are less confident that their organisation can address all its ESG priorities, they are more confident in their ability to stand up to stakeholder scrutiny over ESG policies, with 43% of CEOs aged 40-49 expressing confidence compared to 33% of CEOs aged 50-59 and 30% of those in the 60-69 age group.