close
Share with your friends

    The KPMG NI CEO Outlook provides an in-depth 3-year outlook on enterprise and economic growth from thousands of executives around the world including from Northern Ireland. The full survey launches on 14 September 2021, so watch this space for updates.

Business & economic confidence bounces back from 2020

But still shy of pre-pandemic levels say NI CEOs

NI CEOs are optimistic about the domestic economy, but confidence is just short of the levels of confidence in 2019. Over seven in ten (72 percent) of NI CEOs surveyed are optimistic about growth prospects for the domestic economy compared to 44 percent in 2020. They have highlighted that strategies such as joint ventures, M&A and strategic alliances are the main post-pandemic levers for increased levels of growth.



1. The road to renewal

The pandemic was a true test of leadership for CEOs: they have had to help protect the health and well-being of their employees, make big decisions amid uncertainty, adapt their leadership approach in a virtual environment and prepare for the post-pandemic era. Today, CEOs are facing new challenges as their organisations manage the ongoing impact of the pandemic: balancing the potential to drive growth with uncertainty around the potential of an uneven global recovery.

  • The growth rebound: The vast majority of NI CEOs are confident in the future success of their organisation, but they are cautious in relation to revenue growth. Forty percent of CEOs in NI project modest three-year growth of up to 2.5 percent and just under a third (32 percent) expect growth between 2.5 and 5 percent growth while 8 percent expect growth between 10 and 19.9 percent.
  • M&A appetite high: Overall, 68% percent of NI CEOs say they’re looking to make deals in the next 3 years. Among those, 44 percent characterise their M&A appetite as high which is slightly higher than pre-pandemic levels.
  • Three-way tie for top risks: When looking at risks for growth over the next 3 years, Northern Irish CEOs identified cyber security, operational concerns and digital disruption, as the top risks.

2. The future of work – the office is here to stay

As working from home has become the norm for so many, has the demise of the office been overstated? Organisations and their leadership teams have had to grapple with headcount and resourcing challenges, office investment strategies and how to engage with their teams to keep the business running while they try to hit the right note on attracting and retaining people.

  • Remote working: Just over one third (36 percent) of NI CEOs said that their organisation will have most employees working remotely at least 2 or more days a week – just under the 37 percent of their global peers.
  • The talent pool: Johnny Hanna said, “The vast majority of  CEOs in NI recognise that the office is still the main focal point for their operations, but we are also seeing emerging evidence that some business leaders see a growing need for flexibility and the changing nature of talent acquisition and retention. They are assessing operating models to attract the best talent by expanding their reach into a wider pool.”
  • Keeping the footprint: CEOs in NI are shying away from making wholesale changes to the future of work. Only 16 percent plan to or have already downsized their physical footprint or office space as a result of the pandemic and changing working habits – down significantly from seven in ten (72 percent) in 2020. According to Johnny Hanna “CEOs are less likely to downsize their physical footprint compared to last year’s survey as remote working has highlighted the value offices bring in building culture, coaching and collaboration.

3. Trusted purpose – greater demands from stakeholders on ESG

Transparency and accountability are two of the main drivers of the ESG agenda. CEOs and their boards have more focus than ever on a wide range of issues as stakeholders from investors and regulators to customers and employees demand more of organisations.

  • Increased investor scrutiny: A greater proportion of NI CEOs (72 percent) report a demand from investors, regulators, and customers for increased reporting and transparency on Environmental, Social and Governance (ESG) issues than their counterparts worldwide (58 percent). According to Russell Smyth, Partner and Head of KPMG’s Sustainable Futures practice, “Among the many socio-economic, social and environmental challenges facing the world, stakeholders are focusing on the corporate role in tackling climate change — cutting carbon emissions and leaving a positive impact on society.”
  • State support needed on net zero: 76 percent of NI business leaders are focused on locking in the sustainability and climate change gains made during the pandemic. However, CEOs both in NI and globally indicate that a multifaceted approach will be required - the vast majority of leaders surveyed (72 percent in NI and 77 percent globally) believe that government stimulus is required to turbocharge their goals of reaching net zero.
  • COP26 – a pivotal moment: Eight out of ten CEOs (84 percent) in NI believe that this Autumn’s COP26 climate summit in Glasgow will be a pivotal moment in injecting urgency to the climate change agenda. Commenting on CEO sentiment, Russell Smyth said, “Business is moving with pace on climate action and we’re experiencing high demand for support in helping companies in every sector pivot to a low carbon or net zero future. Five years ago, the climate change agenda was virtually non-existent, and it never really reached the C-Suite but now it is one of the most pressing priorities for CEOs.”

Conclusion

Our survey shows that CEOs in NI are more than willing to lead by example to embrace today’s demanding leadership challenges. With the renewed optimism on the domestic economy, they intend to lead their teams in a changed and flexible working environment but one which still has the office at the heart of the business. Meanwhile, their increased focus on ESG matters has climate change firmly on the agenda as they also focus on critical issues such as cyber security, disruptive technology, operational concerns and supply chain disruption.

The full KPMG 2021 CEO Outlook will be published on Tuesday September 14

Methodology

The KPMG CEO Outlook provides an in-depth 3-year outlook from thousands of global chief executives including from Ireland on enterprise and economic growth. 

The KPMG 2021 CEO Outlook asked 1,325 CEOs from among the world’s most influential companies to provide their 3-year outlook on the economic and business landscape, as well the impact that the on-going COVID-19 pandemic will have on their organizations' future. All respondents have annual revenue over US$500M and a third of the companies surveyed have more than US$10B in annual revenue.

The survey was conducted June 29 – August 6 and included leaders from key markets (Australia, Canada, China, France, Germany, India, Ireland, 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).

Note: Some figures may not add up to 100 percent due to rounding.

1 High-growth organizations are defined as those that see earnings growth exceeding 5 percent per annum over the next 3 years.