CEO Outlook 2025

Importantly, CEOs globally don’t see AI as a means to reducing total head count in the near term. In fact, 67% of New Zealand CEOs plan to increase headcount over the next three years (down on 92% globally), even as they modernise processes and operating models. Almost a third of New Zealand CEOs are planning for workforce reduction in some roles over the long term (2-5 years), but this is balanced by 80% of CEOs focusing their organisations on people redeployment by redesigning roles and career paths to reflect AI collaboration over that period.

New Zealand CEOs are much more focussed on AI as a driver of growth than global counterparts. Three times as many New Zealand CEOs (27% versus 9% globally) see development of new AI-enabled products or services that create new revenue streams as a top benefit.

Most CEOs globally anticipate AI returns will materialise over one to three years, not overnight. Expectations of New Zealand CEOs are similar but with a larger proportion anticipating it will take longer to see a return on investment from AI. In New Zealand, 43% think it will take three years or more compared to just 14% globally.

The signal is strong - AI is positioned as a core driver of productivity, innovation, and new business models. That momentum now intersects with the next frontier: agentic AI - systems that can plan, decide, and act across workflows with minimal human prompting. New Zealand CEOs have even greater expectations than their global counterparts. 70% of New Zealand CEOs expect agentic AI to have a significant or transformational impact compared to 57% globally.

The same leaders underscore the governance and capability gap. Ethical implications (60%), data readiness (50%), and technical capabilities and skills (60%) top their concerns. Technical capability is more of a concern in New Zealand than elsewhere.

Executives are responding with a balanced strategy. Investing boldly, but building trust and guardrails in parallel, recognising that adoption will be sustained only where autonomy is paired with accountability, transparency, ongoing relevant education programmes and robust cyber security.

To convert enthusiasm into durable value, organisations should invest in ongoing education and capability‑building as deliberately as investment in platforms and agents. Results from a report from KPMG and the University of Melbourne, Trust, attitudes and use of artificial intelligence: A global study 2025 clearly highlight the differences in AI adoption success in those countries that are investing in structured education programmes to boost AI literacy versus those that haven’t. New Zealand CEOs are aligned with their global counterparts in recognising this. 80% of New Zealand CEOs cite workforce upskilling as important for organisational success. They are less confident their organisation is equipped to educate employees on getting the benefits of AI (50% for New Zealand CEOs versus 78% globally). But they are almost three times as likely to make AI education and upskilling of the workforce and streamlining processes a top operational priority (17% compared to 6% globally). 60% of New Zealand CEOs are actively hiring for AI and broader tech skills.

Practically, that means role‑based learning paths, ‘agent‑thinking’ workshops that teach process decomposition, sandboxed hands‑on labs, and embedded change programmes that help teams redesign work with agents, not just around them. Pairing education with outcome‑based roadmaps, measuring time‑to‑value against the expected one to three year return-on-investment window, will maximise impact, accelerate trust, and ensure agentic AI delivers on its promise in a sustained, scalable way. Learning velocity will determine adoption velocity and ongoing relevant education is a key pillar in creating sustained adoption of AI programmes.

Looking ahead, maintaining AI as a priority and sustaining progress will continue to be challenging. A third of New Zealand CEOs don’t see their board as being equipped to navigate the adoption of advanced technologies and the strategic use of data, including AI, to drive business growth within the organisation. This is a significant gap with only 10% of global CEOs having the same concerns. AI is clearly an investment priority for most New Zealand CEOs, but they are also feeling more pressure from competing priorities than global peers. In particular, cyber security and digital risk resilience, where around two thirds of New Zealand CEOs see this as the top investment priority (versus 39% globally).

Despite these challenges, it is encouraging to see that almost two thirds of New Zealand CEOs are confident about their ability to keep pace with the speed of AI development and its effects on adoption, operations or workflow, and the workforce.

While it is positive that CEOs understand the threat of a cyber security attack and are taking cyber security seriously, this seems to contradict the fact that New Zealand organisations continue to have relatively low cyber security maturity, with the average maturity rating for New Zealand organisations being about 2.3 on a 0 to 5 scale. (A rating of 2.3 means that organisations only have basic security processes in place, with many of the security controls operating on an ad-hoc basis). Despite New Zealand organisations being focused on cyber security more than they ever have, very little traction is being made in terms of improving cyber security and reducing the risks faced.

This appears to be the result of how organisations are making decisions about where to invest their time and money. Too often, the investments being made have little impact on reducing the risk and result in a false level of comfort. Rather than organisations focusing their time and money on the areas that have the ‘biggest bang for buck’ from a risk reduction perspective, the focus tends to be on the areas that make the biggest noise. Added to this, IT support providers and vendors are often recommending things in an effort to sell more services and products, rather than something that would have a noticeable benefit to the organisation. For example, organisations are commonly bringing on a third-party provider to operate a SOC (security operations centre) capability to detect and respond to security incidents. And while that sounds like a positive step (and it can be), often because the organisations have poor security in other areas, they end up with a relatively expensive service that does little to reduce the risk posed.

Instead, organisations should be stepping back and taking a more mature approach to cyber security risk management to help inform their focus. Organisations should be able to quantify the benefits of their investments in terms of reduced cyber losses and shape their optimal investment strategy to achieve the best risk reduction for their budget. In doing so, it allows senior leadership teams and boards to have confidence in their cyber risk position against appetite.

With such low cyber security maturity, it is not surprising that New Zealand organisations are not focused on emerging risks. While almost every CEO said they were aware of the risk quantum computin g poses to encryption, only 10% were concerned or very concerned about it. This is noticeably different to other ASPAC countries who had an average of 31%, or Australia at 36%.

Although quantum computing might seem like a concept from science fiction, the technology is set to have major impacts on today's cyber security capabilities. Companies like Amazon, Google, IBM, Microsoft, and D-Wave have already launched commercial quantum-computing cloud services. Quantum computers could start to become mainstream by 2030, so the sooner we focus on mitigating the risks, the better. The pace that new technologies are becoming mainstream, as was readily seen with generative AI tools (such as ChatGPT and Copilot), means that there is little time to waste.

The extent of preparation organisations undertake today is expected to be vital in limiting their exposure and vulnerability to emerging threats, making quantum risk planning a key priority. Quantum computers can break encryption methods at an alarming rate, making current encryption tools ineffective for protecting everything from banking and retail transactions to business data, documents, email, and more. ‘Harvest-now, decrypt-later’ attacks might allow adversaries to steal encrypted files and store them until more advanced quantum computers become available.

As quantum technology progresses and organisations keep exploring and recognising both its transformative advantages and threats, new legislation and regulations are in the pipeline. In 2022, the US enacted a law that requires government agencies to begin using post-quantum cryptography - and encourages the private sector to follow this initiative. Both the National Cyber Security Centre (NCSC) in New Zealand and the Australian Cyber Security Centre are encouraging organisations to plan for a post-quantum world. In Australia, for example, government agencies need to have defined a transition plan by the end of 2026 and have completed transition across all systems by the end of 2030.

New Zealand organisations can start preparing by gaining a clear understanding of potential risks throughout their value chain. They should also pinpoint ways to become more cryptographically agile in updating and deploying new cryptographic techniques as they become available. Additionally, it is crucial to develop end-of-life strategies for the data, products and systems that will become obsolete or unable to support new cyber security requirements in a quantum-computing era.

In line with global trends, 60% of New Zealand CEOs are prioritising compliance and reporting standards to meet investor and regulatory demands, and it is encouraging to see that 63% of respondents believe sustainability is critical to their long-term success. But in conflict to this, only half of New Zealand respondents agreed they have the capability and capacity required to meet reporting standards, despite the comparatively early establishment of our climate reporting regime. The rapidly evolving context of sustainability, including ongoing shifts in global reporting and questions around international alignment of reporting standards, may be a contributor to this, with 40% of respondents believing stakeholders' expectations about sustainability are changing faster than they are able to adapt their strategy.

Although many of the companies represented by CEOs surveyed qualified as a New Zealand climate reporting entity at the time of the survey, only 13% of respondents reported that they are quantifying the impact of sustainability risks and/or opportunities on their businesses to support the financial value of sustainability. Recognising and realising the potential for sustainability initiatives to both create and protect business value through mechanisms such as financial quantification is an important turning point that New Zealand has been slow to capitalise on. As global business shifts from a risk to opportunity mindset on sustainability issues, New Zealand’s historic reliance on its clean, green branding, rather than genuine and demonstrable sustainable value creation, will become increasingly precarious.

Overall, from a sustainability, climate and ESG perspective, the 2025 CEO Outlook shows something of a mixed bag for New Zealand. There are signs that the importance of sustainability for long-term business success remains an important theme - only 7% of respondents have decreased sustainability initiatives to balance other priorities - however the real value of investment in these areas has not been fully realised, nor firmly embedded into organisations’ understanding of their key value drivers.

Sustainability and AI

With a clear emphasis on artificial intelligence in this year’s survey, and agreement on the importance of sustainability from New Zealand CEOs, it should come as no surprise that CEOs see the benefit of combining the two. 73% of New Zealand respondents agree that AI has the potential to help their businesses reduce emissions, improve energy efficiency and positively contribute to other sustainability challenges. 77% see AI playing an important role in climate risk modelling and scenario planning as important, 83% see applications in resource efficiency, and 70% see opportunities to support responsible innovation aligned with climate goals. Notably, AI’s role in monitoring environmental impacts across supply chains does not come through strongly (only 40% agree this could be helpful), despite the challenges of decarbonising supply chains noted earlier in the survey.

A remarkable 93% of respondents see innovation efforts being significantly influenced by the energy transition or sustainability demands, with 53% of respondents actively developing and launching new products or services that address these areas.