CEOs see themselves well prepared for recession
KPMG CEO Outlook: Company heads expect mild and short course / medium-term positive outlook for global economy
KPMG CEO Outlook: Company heads expect mild and short course
Berlin/Frankfurt, 4th Oktober 2022
The CEOs of the world's largest companies overwhelmingly expect a recession to occur in the next 12 months. The majority expect it to be mild and short (58 per cent). Three out of four CEOs believe they are well prepared and say they already have plans in place to cushion the impact. This is the result of a worldwide survey of 1,325 CEOs of large companies, including 125 from Germany.*
Even though most CEOs expect only a short and mild recession, they overwhelmingly believe that their companies will not escape unscathed. For example, 71 percent of respondents expect that their company's profits could be up to 10 percent lower in the next 12 months.
Attracting skilled workers is a top priority
For most CEOs, attracting new and securing qualified workers is a top priority to ensure the company's growth. Despite positive experiences with "home working", two-thirds of respondents can imagine employees returning to the office full-time within the next three years. 28 percent continue to assume a mix of office and home work, and seven percent permanently rely on an exclusively "home office".
Global economic development seen positively/ M&A appetite growing
Despite geopolitical and economic challenges, 71 percent of CEOs are positive about the outlook for the global economy over the next three years. This is 11 percentage points more than at the beginning of the year and the highest figure since the start of the Corona pandemic.
Despite the recession expectations, about half of the CEOs are inclined to tackle the issue of mergers and acquisitions aggressively within the next three years. As many as 47 percent - twice as many as at the beginning of the year - say they are "strongly inclined" to do so.
Economic pressure impacts ESG ambitions
CEOs increasingly recognise the importance of ESG efforts for their companies, especially in terms of financial performance and growth. In fact, nearly three-quarters of CEOs believe that ESG progress is improving the company's financial performance - about twice as many as a year ago. They also see increased pressure in this regard, with 69 per cent reporting a significant level of stakeholder demand for more reporting and transparency on ESG issues (up 11 percentage points from a year ago). Equally many expect stakeholders to look more closely at issues such as gender equality and climate impact in the future (72 per cent).
*All companies have an annual turnover of more than 500 million US dollars; one third of more than 10 billion US dollars. The companies are from Australia, Canada, China, France, Germany, India, Italy, Japan, Spain, United Kingdom and USA.