KPMG 2024 U.S. CEO Outlook
Top CEOs see through global turbulence by betting big on AI
Overview
CEOs’ primary focus today remains anticipating and staying ahead of the compounding and interrelated risks that threaten the short-term profitability and long-term prosperity of their businesses. KPMG coined this phenomenon compound volatility: the combination of near-term risks to growth and structural changes to the US economy that raise the cost of doing business with little margin for error on strategy development and execution.
Our latest edition of the KPMG CEO Outlook analyzed insights from more than 1,300 CEOs at large companies globally, including 400 in the United States, to evaluate how they are continuing to navigate the challenge of compound volatility.
CEOs are strategically allocating capital to address near-term risks such as cyber and geopolitics that can cause abrupt business disruption in the short term, while making long-term investments in generative artificial intelligence (GenAI) and mergers and acquisitions (M&A) to spur future growth.
CEOs desire to pursue M&A—it’s their most important strategy to achieve their organization’s growth objectives over the next three years. They are poised to seize opportunities that will drive growth and transformation for their organizations despite changing market dynamics. M&A continues to be a strategic avenue for CEOs to adapt, innovate, and create value.
Some CEOs are unsure if their organization’s cybersecurity can keep pace with rapid AI advancements and whether they will be able to secure the talent and solutions they need to defend against AI threats. Many don’t feel their organizations are well prepared for a cyberattack. As a result, CEOs are increasing their investments in cybersecurity to protect their operations and IP from AI threats.
The race to embrace and embed GenAI is top of mind for CEOs. It remains a top investment and operational priority, with CEOs expecting increased innovation and upskilling the workforce for future readiness, in addition to increased productivity, to be the top benefits.
Pressure to unlock value from GenAI investments is intensifying, while CEOs continue to prioritize its ethical and effective use. CEOs are working to keep pace, and they are focused on the long-term strategic considerations, including its potential to disrupt their business, reshape the competitive landscape, and develop new business models and revenue streams.
The majority of US CEOs see return on investment (ROI) on GenAI coming in three to five years. They are navigating implementation challenges related to data readiness, workforce readiness, governance readiness to ensure responsible use, and lack of regulations.
CEOs are addressing structural changes such as a dynamic labor market and potential policy shifts on the regulatory and tax side. They increasingly favor a comprehensive return to office, but the need for flexibility still holds. CEOs predict GenAI will have little impact on the number of jobs within their organizations but recognize this technology will drive a shift in the way we work, requiring workforce upskilling and better resource management.
In the midst of compound volatility, CEOs are not only navigating risks and making strategic investments, but they are also leaning into their values and acting with purpose, ensuring that their decisions contribute to the long-term prosperity and sustainability of their businesses.
Paul Knopp
KPMG US Chair and CEO
Dive into our thinking:
KPMG 2024 U.S. CEO Outlook
Find out moreCEOs are confident in the long-term growth prospects for their companies against a backdrop of cybercrime, economic uncertainty, geopolitics and political uncertainty.
Threat levels on cyber risk are flashing red in the eyes of CEOs as AI capabilities both within and outside the organization continue to grow. Increased levels of investment in cyber security are needed as AI risks multiply.”
Paul Knopp
Chair and CEO at KPMG US
CEO confidence in economy and company growth prospects
85%
are confident in the growth prospects of their country
78%
are confident in the growth prospects of their company
74%
are confident in the growth prospects of the global economy
When asked to identify the top trends that could negatively impact their organization’s prosperity over the next three years, U.S. CEOs most highly ranked the cost of living, cybercrime and cyber security issues, and talent.
CEOs investing in cybersecurity to counteract risks around rise of AI
37%
are unsure if their organization’s cybersecurity can keep pace with rapid AI advancements
41%
are unsure if they will be able to secure the talent and solutions they need to defend against AI threats
69%
are increasing their investments in cybersecurity to protect their operations and IP from AI threats
GenAI remains a top investment priority, but data, workforce and governance readiness along with a lack of regulations are implementation challenges.
The pressure to unlock value from GenAI investments is intensifying, while CEOs continue to prioritize its ethical and effective use. CEOs are working to keep pace, and they are focused on the long-term strategic considerations, including its potential to disrupt their business, reshape the competitive landscape, and develop new business models and revenue streams. KPMG is helping clients strategize and position their organizations for long-term, sustainable returns with GenAI."
Paul Knopp
Chair and CEO at KPMG US
CEOs investing in cybersecurity to counteract risks around rise of AI
68%
say GenAI is a top investment priority despite uncertain economic conditions
21%
expect to see return from their investments in GenAI in just one to three years
68%
expect to see return from their investments in GenAI in three to five years
CEOs make GenAI investments while confronting challenges to implementation
CEOs most frequently identify information technology (74%), sales and marketing (59%) and finance and accounting (48%) as the top three functional areas where their organization will make GenAI investments over the next three years.
CEOs express low levels of confidence that they will have their data ready to safely and effectively integrate GenAI (34%), their employees have the right skills to fully leverage the benefits of GenAI (39%) and their organization is ready to safely deploy and integrate GenAI with robust governance frameworks (56%).
CEOs desire to pursue M&A, but their timeline remains on the horizon.
CEOs are poised to seize M&A opportunities that will drive growth and transformation for their organizations despite changing market dynamics. M&A continues to be a strategic avenue for CEOs to adapt, innovate, and create value.”
Paul Knopp
Chair and CEO at KPMG US
CEOs have appetite for M&A
49%
indicate they have a high M&A appetite and will likely undertake acquisitions that have a significant impact to their organizations
39%
plan to make acquisitions that will have a moderate impact to their organizations
CEOs identify M&A (30%) and organic growth (22%) as the most important strategies for achieving their organization’s growth objectives over the next three years.
CEOs aren’t confident they will meet their net-zero goals due to decarbonization challenges, but commitment to pushing forward with climate-related strategies remains.
CEOs remain steadfast on their climate-related strategies, which they expect to deliver financial returns in the coming years. Reaching net-zero goals by 2030 is proving difficult due to challenges operationalizing those strategies, especially decarbonizing supply chains."
Paul Knopp
Chair and CEO at KPMG US
Some CEOs not confident they will meet Net Zero goals by 2030
54%
of CEOs are confident that their organizations will be able to meet their net-zero goals by 2030
24%
cite the complexity of decarbonizing supply chains as the major barrier
24%
cite a lack of skills and expertise to successfully implement solutions as another major barrier
CEO sentiment related to a full return-to-office soars; they predict GenAI will have little impact on the number of jobs but will require upskilling and better resource management.
CEOs increasingly favor a comprehensive return-to-office but the need for flexibility still holds. As this future unfolds, the integration of GenAI will become increasingly prominent, and upskilling the workforce will be a prerequisite for most white-collar roles."
Paul Knopp
Chair and CEO at KPMG US
CEO sentiment on full return-to-office soars
79%
of U.S. CEOs envision the working environment for corporate employees whose roles were traditionally based in-office to be back in the physical workplace in the next three years – a marked shift from earlier this year (34%)
17%
envision these roles to be hybrid (46% earlier this year) and only 4% envision them being fully remote (3% earlier this year)
86%
say they will reward employees who make an effort to come into the office with favorable assignments, raises or promotions
GenAI won’t impact number of jobs – but will require upskilling
72%
said GenAI will not fundamentally impact the number of jobs but will require upskilling and existing resources to be redeployed
27%
said it will create more jobs than it eliminates.
About the KPMG CEO Outlook
The KPMG CEO Outlook provides an in-depth three-year outlook from global executives on enterprise and economic growth.
The report surveyed 1,325 CEOs in 11 key markets (Australia, Canada, China, France, Germany, India, Italy, Japan, Spain, UK and US) and 11 key industry sectors (asset management, automotive, banking, consumer and retail, energy, infrastructure, insurance, life sciences, manufacturing, technology, and telecommunications).
All respondents have annual revenues over US$500M and more than one-third of the companies surveyed have more than US$10B in annual revenue. The survey was conducted between July 15 and August 29, 2024.
About KPMG LLP
KPMG LLP is the US firm of the KPMG global organization of independent professional services firms providing audit, tax and advisory services. The KPMG global organization operates in 142 countries and territories and has more than 273,000 people working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.
KPMG is widely recognized for being a great place to work and build a career. Our people share a sense of purpose in the work we do, and a strong commitment to community service, inclusion and diversity and eradicating childhood illiteracy. Learn more at www.kpmg.com/us.