A bullish outlook

Canadian CEOs have had a lot to wrestle with over the past year. From inflation, tight labour markets, and supply chain snarls to new regulations, perpetual cyberattacks, and extreme weather events, business leaders have had to remain agile and rethink every aspect of their operation.

In the ninth annual KPMG Global CEO Outlook survey and its 2023 companion KPMG Private Enterprise™ Business survey, we interviewed leaders at 775 companies across Canada, including the most-influential organizations, to gain insight into their mindset, strategies, challenges, and investment plans over the next three years.

In the face of socio-economic and climate-related challenges, Canadian business leaders remain highly optimistic about the country's economic outlook and in turn their own company's prospects. Their optimism is rooted in part, in the fact that recessionary concerns had accelerated their efforts to improve their operational efficiency, productivity, and cashflow management, leaving them in a stronger position to address any headwinds and drive growth.

Top risks

However, the surveys reveal that the 'will it or won't it happen recession', inflationary pressures, geopolitical tensions, heightened regulation, and climate change are weighing on everyone.

Confidence in growth prospects over the next three years

Their worries are evident in their short-term outlook. When compared to their global peers, the CEOs of Corporate Canada (with well over $1 billion in annual revenue) have consistently been among the world's most confident about their company's three-year growth prospects. Last year, an incredibly high number - 91 per cent - of Canadian CEOs felt confident about their company's outlook in line with the sentiment held by their peers in countries, such as in Spain (98 per cent), the U.S. (95 per cent), and Germany (91 per cent). This year, with so many different pressures and issues coming at them, it's not surprising that fewer CEOs – right across the globe – are less confident in their company's growth prospects than they were a year ago. Both Canada and Germany saw an 11-point drop. Similarly, Spain is down 12 points and the U.S. declined 16 points.

The biggest risk to their growth outlook – the one keeping Canadian CEOs awake at night – is the impact of emerging or disruptive technologies on their business. Are they moving fast enough? Are their technology and business strategies aligned?

Biggest risks to growth over the next 3 years

While regulatory risks dropped from the top spot in 2022, it remains in the top 4 as CEOs grapple with the complex and everchanging regulatory landscape in any number of areas from tax, trade and supply chain to net-zero carbon emissions and environmental, social, and governance (ESG) requirements.

It is not surprising that the CEOs rated cybersecurity and climate change lower on their near-term risk scale when put in the context that their organizations have invested millions to protect against cyberattacks and have been keenly focused on their net-zero carbon emission plans for several years now.

In contrast, SMBs are playing catch up. Their No. 1 concern: Cybersecurity. That's followed closely by emerging technologies, energy security and affordability, and climate change risk.

Top priorities

Canadian CEOs surveyed for KPMG's annual Outlook say their top operational priorities to achieve their three-year growth objectives are:

Toop priorities for growth

The findings mirror the views held by the vast majority of SMBs that we surveyed.


A shortage of skilled labour remains a key obstacle to growth.

While many organizations admit that they trimmed headcount in anticipation of a recession that didn't happen, 88 per cent of Canadian CEOs are expecting to increase their headcount over the next three years. By comparison, only 59 per cent of SMBs plan to increase their headcount.

The difficulty is finding the right people to help them compete in a technology-enabled and service-based economy. Seventy-seven per cent of CEOs (vs. 68 per cent globally) said labour shortages and the lack of skilled workers pose a threat to Canadian organizations and believe a holistic approach between government, industry, and academic institutions will be required to create meaningful long-term solutions to address the problem.

Over eight in 10 (84 per cent) SMBs say that despite the influx of immigrants into Canada, they can't find the talent they need and 72 per cent are recruiting directly outside of Canada for highly skilled labour. Nearly three-quarters (74 per cent) add that Canada's high cost of living, driven primarily by prohibitive housing costs, makes it "extremely difficult to attract and retain top talent", including foreign workers.

Canadian CEOs also identified the rising cost of living as the socio-economic trend most likely to negatively impact their organization's prosperity over the next three years.


88% of Canadian CEOs expecting to increase headcount over the next three years

Return-to-the-office vs. hybrid

Business leaders in Canada and globally remain committed to getting more employees back in the office, although the number of Canadian leaders who predict a full return to in-office work within the next three years has declined to 55 per cent from 75 per cent a year ago. In comparison, 64 per cent of their global counterparts expect a return to pre-pandemic ways of working.

To accelerate this trend, more than three quarters (77 per cent) of Canadian CEOs say they are very likely or likely to reward employees "who make an effort to come into the office with favourable assignments, raises, or promotions" compared to 88 per cent globally and 75 per cent of Canadian SMBs.

factors that could negatively impact organizational prosperity


Technology transformation is a top priority across all organizations.

Fifty-seven per cent of Canadian CEOs surveyed are prioritizing more capital for technology (vs. 54 per cent globally) and 43 per cent are investing in developing their workforce's skills and capabilities (vs. 46 per cent globally). This represents a much more even appropriation than last year when Canadian CEOs had an 80-per cent technology and 20-per cent workforce investment.


75% of Canadian CEOs making generative AI a top investment priority

Among SMBs, the vast majority (87 per cent) say that they must invest and are investing in digital technologies to meet their growth targets and 83 per cent are investing to close a digital gap with Corporate Canada.

Three-quarters of SMBs also expressed concern that Canada isn't keeping pace with the U.S. in transitioning to the future economy, particularly in the use of new technologies such as artificial intelligence (AI), digital, and innovation – all important tools to help boost productivity, reduce friction, and fuel growth when used both strategically and responsibly.

About a third (32 per cent) of SMBs strongly agreed that they are racing to seize on the potential of AI and are recruiting actively for talent, such as data scientists, technical professionals, and machine learning specialists, to help them deploy AI technology. Upskilling is also high on their agenda, with 80 per cent encouraging their employees to upskill in areas like AI and data analytics to make smarter, more informed decisions to improve their operations.

Last year, generative AI hadn't yet exploded into the mainstream. Now, globally, CEOs are investing heavily in generative AI as their competitive edge for the future, making it a top investment priority and predicting it will pay off over three-to-five years. Canada ranks No. 2 behind Germany, with 75 per cent of Canadian CEOs making generative AI a top investment priority. By comparison, most SMBs are taking a risk-averse wait-and-see approach, although over three-quarters feel the benefits of generative AI outweigh the risks of adopting it in the near term and would like to see more business use case examples. Both surveys reveal a deep concern about the ethical challenges around generative AI, including bias in datasets, privacy, transparency, misinformation, and intellectual property.


Cybersecurity remains an ever-present threat.

With cyberattacks increasing in frequency, sophistication, and maliciousness, new technologies can pose potential risks that we will explore in an upcoming Insights article. But here's a teaser: An astounding 93 per cent of Canadian CEOs (vs. 82 per cent globally) are worried that generative AI might enable additional cyberattacks and 44 per cent (vs. 52 per cent globally) feel not well prepared for them.

For SMBs, the biggest challenge is freeing up the capital to invest in cyber defences and hiring skilled personnel to implement cybersecurity or monitor for attacks. Fewer than a third (31 per cent) are hiring third parties to audit their security processes and systems on a regular basis. Few are regularly reviewing security protections with third parties that store their data or manage their systems. The survey findings signal a clear and present need to assess, increase, and thoroughly audit cybersecurity practices and protocols.


The surveys show that ESG is becoming a core business requirement, with most companies embedding ESG into their strategy and operations. Yet, they face some notable barriers, including a complex regulatory environment and a lack of appropriate technology. Organizations are also changing the way they talk about ESG in part due to the politicization of the term. Instead, they are opting to substitute the ESG acronym with the term, sustainability.

An astonishing 71 per cent of CEOs indicated that their current ESG efforts would likely not stand up to scrutiny – underscoring the need to review and address the gaps given the reputational, financial, and societal backlash that they could face if they fail to live up to their commitments.

With lives and livelihoods impacted by the worst-ever wildfire season in modern Canadian history, coupled with extreme weather events around the globe, it comes as no surprise that our surveys show Canadian organizations are prioritizing the 'E' in ESG.

Indeed, CEOs in Canada – more than their peers in any other country – are prioritizing the need to address environmental challenges, such as achieving net zero carbon emissions (51 per cent vs. 35 per cent globally). Similarly, 80 per cent of SMBs say they are more determined than ever to find ways to reduce their impact on the environment.

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About our surveys

KPMG International surveyed 1,325 global CEOs from major organizations in 11 countries (Australia, Canada, China, France, Germany, India, Italy, Japan, Spain, the U.K., and the U.S.) across 11 key industry sectors, including asset management, automotive, consumer and retail, energy, financial services, infrastructure, life sciences, manufacturing, technology, and telecommunications. The CEOs are drawn from companies with annual revenue over US$500 million and a third of the companies surveyed have more than US$10 billion in annual revenue. The survey was conducted from August 15 to Sept. 19, 2023.

KPMG Private Enterprise surveyed business owners or executive level C-suite decision makers at 700 small-and-medium-sized Canadian companies between August 30 and Sept. 25, 2023, using Sago's premier business research panel. A quarter of the companies surveyed have more than C$500 million and less than C$1 billion in annual revenue, a quarter have more than C$300 million and less than $500 million in annual revenue, 23 per cent have between C$100 million and C$300 million in annual revenue, and 26 per cent have between C$10 million and C$50 million in annual revenue. No companies were surveyed under C$10 million.