While CEOs are optimistic about the global economy, macroeconomic volatility, inflation, and geopolitical uncertainty top the lists of risks of greatest concern, according to PwC’s 2025 Global CEO Survey, which fielded feedback from more than 4,700 CEOs globally across all industries.

By Patricia Van Arnum, Editorial Director, DCAT, pvanarnum@dcat.org

CEO views: global economic outlook
Beginning with the fundamentals—what is CEOs’ confidence in the performance of the global economy in 2025? Almost 60% of CEOs expect global growth to increase over the next 12 months, up from 38% last year and 18% two years ago, which was a recent low point, according to PwC’s 28th Annual Global CEO Survey, released last month (January 2024) during the World Economic Forum Annual Meeting in Davos, Switzerland. The study was based on a survey of 4,701 CEOs across 109 countries and territories taken in October to early November 2024.

While CEOs are broadly optimistic about the global economy in the year ahead, there are also differences between countries. Among the G20 countries, CEOs in Germany are most concerned  about the outlook for the domestic economy, reflecting an industrial base experiencing not only weak demand but also supply shortages in energy, components, skilled labor, and other areas. In contrast, CEOs in India and Argentina are most optimistic. Nine out of ten CEOs in India (87%) expect domestic economic growth to accelerate in the year ahead. The G20 comprises 19 countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, and the United States), the European Union, and since 2023, the African Union.

CEOs views: top risk concerns
While CEOs are optimistic about the global economy, macroeconomic volatility (29%) and inflation (27%) remain the top risks for the year ahead cited by CEOs globally, according to the PwC study. CEOs were asked which risks that they felt their companies would be most exposed to over the next 12 months, defining exposure as the probability of significant financial loss. Although macroeconomic volatility and inflation were the top risks cited by CEOs, nearly a quarter of CEOs cited cyber security and availability of workers with key skill sets as the greatest risks to which they their companies faced exposure to over the next 12 months. Risks posed by geopolitical conflict and technology disruption were cited by approximately one-fifth of CEOs. The full breakdown of CEO responses is outlined below:    

• Macroeconomic volatility (29%)
• Inflation (27%)
• Cyber risks (24%)
• Lower availability of workers with key skill sets (23%)
• Geopolitical conflict (22%)
• Technological disruption (20%)
• Climate change (14%)
• Social inequality (7%)

In evaluating their companies’ risk exposure, there were clear differences between regions. Geopolitical conflict is seen as the biggest risk in the Middle East (41%) and Central and Eastern Europe (34%). In Western Europe, cyber risk (27%) is a marginally higher concern than a lack of skilled workers (25%) and inflation (24%) and macroeconomic volatility topped the list at 29%.  North America and Asia-Pacific prioritize risks largely in line with the global averages.

CEOs views: company outlook
To evaluate CEOs outlook for their own companies, the study a asked CEOs whether they expected to increase headcount in the coming year. The PwC study found that 42% expect to increase their company’s headcount by 5% or more in the next 12 months – more than double the proportion who expect headcount decreases (17%), and up from 39% last year. The percentage is highest (48%) among smaller companies (less than $100 million) and those in the technology (61%), real estate (61%), private equity (52%) and pharma and life sciences (51%) sectors.

Longer term, CEOs were asked about their companies’ viability over the next 10 years and the need for adaption or change to their business models. Consistent with PwC’’s last two annual surveys, four in ten CEOs (42%) say their company will remain viable for less than 10 years if it continues on its current path. Among those that do not expect to be viable without significant change, 42% cite shifts in the regulatory environment as having the biggest influence on their economic viability.

Looking at the pharma industry specifically, concerns over long-term viability have increased over the last two years. In 2023, only 28% of pharmaceutical CEOs said their company would not be viable for more than 10 years if it continued on its current path. In 2024, this increased to 38%, and this year’s study, it increased to 45%.

Across all sectors, just under two-thirds of CEOs (63%) report having taken at least one significant action to change how their company creates, delivers, and captures value, according to the PwC study. The most common reinvention actions are product and service innovation and moves to target new customer groups. Fewer companies have taken actions that typically come with higher degrees of difficulty—such as pioneering new routes to market, implementing new pricing models or collaborating with other organizations to create new ecosystems, according to the PwC study.

“This year’s CEO Survey findings highlight a stark juxtaposition – business leaders around the world are optimistic about the year ahead, but also know they must re-invent how they create, deliver and capture value,” said Mohamed Kande, Global Chairman, PwC, in a January 20, 2025,  statement, in commenting on the study.

With that need to adapt, the PwC study showed that across all sectors, almost two-thirds (63%) of CEOs surveyed in the study have taken at least one significant action to change how their company creates, delivers, and captures value in the last five years, with CEOs that have taken more reinvention actions in the last five years reporting higher profit margins in the last 12 months. As companies look to reinvent their business models, almost four in ten (38%) say they have begun competing in at least one new sector in the last five years – with about one-third (34%) noting this has represented over 20% of company revenue over this period.

However, the pace of reinvention is tempered. When it comes to moving budget and people between projects and business units, around half of CEOs said that they reallocate 10% or less of financial and human resources from year to year. More than two-thirds reallocate less than 20%. On average, only 7% of revenue over the last five years has come from distinct new businesses, according to the PwC study.