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Global CEO confidence returns to pre-pandemic levels

Launching aggressive M&A plans to capture market opportunities.

Launching aggressive M&A plans to capture market opportunities.

  • Eight out of ten global executives say they are ready to make an acquisition in the next 3 years
  • Business leaders believe government stimulus needed to meet net-zero targets
  • Three out of four CEOs believe that the pressure put on public finances during the pandemic has increased the urgency of multilateral cooperation in the global tax system

CEOs of the world’s largest businesses are increasingly optimistic about the outlook for their own business and despite the Delta variant slowing down the ‘return to normal’, their confidence in the global economy has returned to levels not seen since the start of the pandemic. The KPMG 2021 CEO Outlook, which asked more than 1,300 global CEOs about their strategies and outlook over a 3-year horizon, finds that 60 percent of leaders are confident about the global economy's growth prospects over the next 3 years (up from 42 percent in the January/February’s pulse survey).

The prospect of a stronger global economy is leading CEOs to invest in expansion and business transformation, with 69 percent of senior executives identifying inorganic methods (e.g. joint ventures, M&A and strategic alliances) as their organization’s main strategy for growth. A majority (87 percent) of global leaders stated that they are looking to make acquisitions in the next 3 years to help grow and transform their businesses.

The survey found that 30 percent of CEOs plan to invest more than 10 percent of their revenues toward sustainability measures and programs over the next 3 years.

Key findings

Reaching net zero with government support

Among the many socio-economic, social and environmental challenges facing the world, stakeholders are putting immense pressure on businesses to tackle climate change and leave a positive impact on society. As a result, over a quarter (27 percent) of business leaders are concerned that failing to meet climate change expectations will result in the public markets not investing in their business. Over half (58 percent) of CEOs said that they face increased demands from stakeholders (e.g. investors, regulators and customers) for more reporting on ESG issues.

Three out of four (77 percent) of global executives believe that government stimulus will be required if all businesses are to reach net zero. Furthermore, three-quarters (75 percent) of global CEOs have identified COP26 as a pivotal moment to inject urgency into the climate change agenda.

The research found that corporate purpose, what the company stands for and its impact on communities as well as the planet, is driving 74 percent of CEOs to act in addressing the needs of their stakeholders (customers, employees, investors and communities). There has also been a 10-point increase since the beginning of 2020 in the number of CEOs who say their principal objective is to embed purpose into the decisions they make to create long-term value for their stakeholders (64 percent). More than eight out of ten (86 percent) global leaders state that their corporate purpose will shape capital allocation and inorganic growth strategies.

Shifting focus toward operational and environmental risks

When looking at risks for growth over 3 years, senior executives identified three areas they see as top risks: supply chain, cyber security and climate change. Fifty-six percent of global CEOs say that their business’ supply chain has been under increased stress during the pandemic.

Table 1: Biggest risks to growth over the next 3 years

        2021 CEO Outlook (July/Aug 2021)                   2020 CEO Outlook pulse (July/Aug 2020)      
       Risk to growth       Rank      Risk to growth     Rank    
Cyber security risk
Talent risk
Environmental/climate change risk
#1 Supply chain
Supply chain risk
#1 Return to territorialism
Emerging/disruptive technology risk
#2 Environmental/climate change risk #4
Regulatory risk
#2 Cyber security risk
Operational risk
#2 Emerging/disruptive technology risk)

Changing sentiment on the future of work

Just 21 percent of CEOs now say they are planning to downsize, or have already downsized, their organization’s physical footprint, a dramatic shift from August 2020, with the first wave of the pandemic at its peak, 69 percent of global leaders said that they planned to downsize their space.

CEOs are focused instead on providing increased flexibility for their workforce with 51 percent (up from 14 percent in the January/February’s pulse survey) looking to invest in shared office spaces. Furthermore, 37 percent of global executives have implemented a hybrid model of working for their staff, where most employees work remotely 2–3 days a week.

Unprecedented international tax reforms a significant focus for CEOs

Three out of four (75 percent) CEOs believe that the pressure put on public finances by the pandemic response has increased the urgency for multilateral cooperation on the global tax system. At the same time, 77 percent of senior executives agree that the proposed global minimum tax regime is of “significant concern” to their organization’s goals on growth. Meanwhile, they are more worried about regulatory and tax risks than they were prior to the pandemic (reference table 1 above).

The research found that 74 percent of CEOs recognize the strong link between the public’s trust in their businesses and how their tax approach aligns with their organizational values. As businesses aim to build back better, a majority (69 percent) of CEOs are feeling increased pressure to report their tax contributions publicly as part of their broader ESG commitments.

About KPMG’s CEO Outlook

The KPMG CEO Outlook provides an in-depth 3-year outlook from thousands of global executives 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 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).

About KPMG in Vietnam

KPMG is one of the largest professional firms in Vietnam, with offices in Ho Chi Minh, Hanoi and Danang. Established in 1994, we have more than 27 years of experience with more than 1,500 professionals and 49 partners in Vietnam and Cambodia, of which KPMG Vietnam has 41 Partners & more than 1,200 professionals.

We have established strong relationships with over 7,900 clients and engaged in over 42,000 projects in Vietnam and Cambodia over the years. Specifically, KPMG Vietnam on its own has had more than 34,000 engagements with over 6,700 national and international firms, with substantial experience in a variety of sectors. As of 2021, KPMG Vietnam accounts for 39% of the audit market share of the top 50 listed companies in Vietnam by market capitalization.

For press requests, please contact:

Tran Thanh Tam
Director, Head of Markets Group
KPMG in Vietnam
+84 283 821 9266

Nguyen Thi Thu Tam
Manager, Head of Marketing & Communications
KPMG in Vietnam
+84 283 821 9266

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