Our survey reveals that most CEOs are showing resilience in a sluggish economy and looking past the next six months to a brighter two to three years after that. Most expect staff numbers to rise along with growth over that timescale.
This year’s survey reveals that Australia’s business leaders are betting big on AI, focused on bolstering their workforce and taking responsible steps forward to finding sustainable growth.
KPMG’s 10th annual CEO Outlook, which surveyed 1,325 CEOs across 11 top economies including Australia, offers insights into the strategic direction and concerns of today’s CEOs.
Key Australian developments
What’s top of mind for Australian CEOs?
see generative AI as the top investment priority
are optimistic about growth over the next three years
believe they have data ready for AI integration
say failure to meet ESG goals is a threat to tenure
forecast a return to the office within three years
Despite economic uncertainty, Australian and global CEOs consider generative AI a top investment priority. They expect it to boost efficiency and productivity but are aware of challenges, including ethical concerns, data readiness, regulation, and the required technical skills.
- 84% of Australian CEOs and 64% of global CEOs see gen AI as a top investment priority.
- Less than half (42% Australian, 35% global) feel their data is ready for gen AI integration.
- 72% of Australia’s CEOs and 76% of global CEOs do not believe gen AI will lead to job cuts.
A majority of CEOs are optimistic about their company’s growth over the next three years. While some foresee significant growth, others anticipate modest increases. The optimism extends to their industry sector and the national economy but is more tempered regarding the global economy.
- 86% of Australian CEOs and 76% of global CEOs are confident in their organisation’s growth over the next three years.
- A minority of Australian CEOs (12%) forecast strong growth of 10–20%.
There’s a trend toward a full return to office work, with incentives for employees who come in. CEOs acknowledge the need for upskilling employees, citing that AI integration has made them reconsider staff training needs, especially for entry-level roles.
- 82% of Australian and 83% of global CEOs predict a full return to office-based work within three years.
- Only 40% of Australian CEOs and 38% globally believe their employees have the necessary skills for new technologies.
- 50% of Australian CEOs (57% global) have rethought their approach to staff training due to AI.
Many CEOs are willing to divest from profitable segments if they harm their company’s reputation and are willing to take a stand on contentious issues. Failure to meet ESG expectations is seen as a significant threat, potentially affecting CEOs’ tenure, with ongoing challenges in adapting to stakeholder expectations.
- Over a quarter of Australian CEOs (26%) fear failure to meet ESG standards could threaten their job.
- 82% of Australian CEOs (up from 54% last year) would divest from profitable segments if it damaged the company’s reputation.
KPMG still believes many companies face challenges when it comes to detailed preparations for Australia’s new mandatory reporting regimes, which will shed more light on how deep ESG has really become embedded in business operations.
Andrew Yates
KPMG Australia CEO
As trust in government declines, businesses are expected to lead on IDE. The majority believe that businesses should help increase social mobility and that achieving gender equality in C-suite positions will aid in meeting their goals. There is also anticipation of increased scrutiny of IDE in the coming years.
- 62% of Australian CEOs and 60% globally believe businesses should lead on IDE as trust in governments falls.
- 80% of Australian CEOs and 79% globally stated that achieving gender equality in the C-suite will help meet their goals.
It is encouraging to see that business leaders in Australia are still generally upbeat, not only for their own companies – which you might expect – but for the country, despite fears being expressed more widely about an economic slowdown.
