Global CEOs double down on AI & talent drive despite economic challenges

Highlights of Global:

• AI remains a top investment priority, with 69 percent of CEOs planning to allocate 10–20 percent of their budgets to AI over the next 12 months.
• However, CEO confidence in the global economy has dropped to 68 percent – its lowest level since 2021.
  
• Despite ongoing economic pressures, 92 percent of leaders are planning to increase headcount over the next 12 months.
  
• 70 percent of CEOs are concerned about competition for AI talent, and 77 percent highlighting workforce upskilling as a challenge.
  
• 61 percent of CEOs now express confidence that they can meet their net-zero goals by 2030, a significant increase from 51 percent in 2024.
  

Highlights of China:

• 88% of Chinese CEOs express confidence in China’s economic outlook — a significant increase of 17 % from last year, marking the highest level in recent years.
• 26% of Chinese CEOs have identified advancing business digitalization and connectivity as their top strategic priority for the next three years, exceeding the global average of 18%.
• The value of artificial intelligence applications is beginning to be realized. 86% of Chinese CEOs expect to see returns on their AI investments within three years, up sharply from 18% last year. Notably, one in five anticipate achieving returns in less than a year.
• 55% of China CEOs are prioritizing compliance and reporting standards to meet investor and regulatory demands, compared to 51% globally.

CEO confidence in the global economy has hit a five-year low, according to the KPMG 2025 Global CEO Outlook, as corporate leaders focus strategic investments in AI, talent and risk resilience to sustain and fuel future growth.

The annual survey of more than 1,300 global leaders reveals a cautious outlook among CEOs, driven by persistent geopolitical tensions and economic uncertainty.

The challenging landscape is prompting a shift in leadership approach, with many adapting their growth strategies to navigate today’s complex world. 68 percent of CEOs are confident in the current trajectory of the world economy – down from 72 percent last year and continuing a long-term trend of declining confidence. At the same time, Chinese CEOs show a clear divergence in their outlook for the global and domestic economies. 58% of respondents are confident in global economic growth over the next three years - a sharp 13 percentage point decline from last year. In contrast, 88% express confidence in China’s economic prospects, up 17% year on year and reaching the highest level in recent years.

Despite the headwinds, cautious optimism persists, with a significant majority of leaders focusing on investment in talent to drive a return to growth. 92 percent of CEOs say they’re planning to increase headcount over the next 12 months, while many remain upbeat on healthy earnings growth and remain keen on M&A. 40 percent forecast earnings increases of more than 2.5 percent in the coming twelve months, while 89 percent are predicting merger or acquisition activity. Their biggest potential roadblocks to achieving growth remain relatively unchanged from last year, with cybercrime and cyber insecurity (79 percent), AI workforce readiness or upskilling of workforce on AI (77%) and success integration of AI into business processes (75 percent) continuing to loom large.

Economic and geopolitical turbulence is forcing CEOs to rethink their leadership and strategy. Most (72 percent) have already adapted their growth plans, but leaders remain divided on what specific capabilities are needed to respond to today’s fast-changing and unpredictable environment, with greater agility and faster decision making (26 percent) vying with transparency in communication (24 percent) and the ability to identify, prioritize, and manage risks (23 percent) for top priority.  

CEOs, navigating a shifting economic landscape, are doubling down on AI and technological innovation. Nearly three quarters (71percent) of leaders say AI is a top investment priority for 2026, with 69 percent planning to invest between 10 and 20 percent of their budgets to AI over the next 12 months.

To enable artificial intelligence to play a deeper role in business operations in the future, Chinese enterprises are accelerating their digital transformation across all elements and processes,26% of Chinese CEOs have identified advancing business digitalization and connectivity as their top strategic priority for the next three years — higher than the global average of 18%.

In addition, as the value of AI applications begins to materialize, 67 percent of global CEOs globally expect to see returns on AI investments within three years. In China, this proportion has surged from 18 percent last year to 86 percent this year. Notably, one in five Chinese CEOs believe they will realize returns from AI implementation in less than a year.

However, an accelerated global adoption of AI is creating new challenges for the boardroom. CEOs express significant reservations regarding ethical implications (59 percent), data readiness (52 percent) and lack of regulation (50 percent). A clear consensus is emerging that robust governance frameworks will be critical for AI's sustained success.

CEOs also recognize the success of AI adoption depends on effective implementation and the prevailing sentiment is a commitment to a people-led deployment of new technology. While concerns persist that AI could lead to widespread job losses, 61 percent of CEOs say they are actively hiring new talent with AI and broader technology skills, while three quarters (70 percent) report concerns about competition for AI talent and 77 percent highlight workforce upskilling as a challenge, underscoring the intensifying race for talent. In terms of concrete actions, 56% of Chinese CEOs are communicating openly with employees about the impact of artificial intelligence on their roles - a proportion higher than the global average of 46%.

At the same time, Chinese CEOs are particularly focused on the medium- to long-term impact of artificial intelligence on business operations. Specifically, the widespread application of AI in enterprise production and management requires substantial upfront investment in computing power, algorithms, and data infrastructure. According to the survey, 79% of Chinese respondents are concerned about these high technology infrastructure costs - a proportion above the global average.

While attitudes toward ESG vary across regions, the KPMG 2025 CEO Outlook indicates that most corporate leaders remain strongly committed to their sustainability goals and increasingly confident of meeting them.

Notably, a majority (61 percent) of CEOs now express confidence in meeting their net-zero targets by 2030. This marked increase in confidence suggests a strengthening belief in the attainability of long-term climate ambitions within the corporate world.

55% of China CEOs are prioritizing compliance and reporting standards to meet investor and regulatory demands, compared to 51% globally.

The 11th edition of the KPMG CEO Outlook, conducted with 1350 CEOs between 5 August 2025 and 10 September 2025, provides unique insight into the mindset, strategies and planning tactics of CEOs.

All respondents oversee companies with annual revenues over US$500M and a third of the companies surveyed have more than US$10B in annual revenue. The survey included CEOs from 11 key markets (Australia, Canada, China, France, Germany, India, Italy, Japan, Spain, UK and US) and 12 key industry sectors (asset management, automotive, banking, consumer and retail, energy, healthcare, infrastructure, insurance, life sciences, manufacturing, technology, and telecommunications). 

NOTE: some figures may not add up to 100 percent due to rounding.

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