CEOs fear climate change and AI impact on business survival

In a recent survey conducted by PwC, more than 4,700 CEOs worldwide expressed a cautious optimism about the global economy, with 38% feeling positive, a significant increase from last year’s 18%. This shift comes as the world grappled with challenges such as high inflation, weak growth, and rising interest rates. Notably, the CEOs’ fear of economic decline decreased from 73% to 45%, despite ongoing geopolitical conflicts affecting global trade.

While the economic outlook has improved, CEOs are increasingly concerned about their companies’ survival in the face of impending challenges. The survey revealed that 45% of respondents worry that their businesses won’t remain viable without a major overhaul within the next decade, up from 39% the previous year. CEOs cited regulatory hurdles, a shortage of skilled workers, and other obstacles hindering their efforts to adapt.

The survey underscored the transformative impact of artificial intelligence (AI) on businesses. While nearly three-quarters of CEOs believed AI would significantly alter how their companies operate and create value in the next three years, concerns loomed large. Over half saw AI as a tool to enhance products or services, but 69% acknowledged the need for workforce training to leverage this technology. Cybersecurity risks and misinformation also emerged as prominent worries.

Bob Moritz, Global Chairman of PwC, emphasized the year’s transformative nature, calling for accelerated adoption of generative AI and business strategies aligned with the challenges and opportunities of the climate transition.

Despite the positive sentiment surrounding climate action, the survey revealed a gap in progress. While almost a third of CEOs expected climate change to impact their operations in the next three years, only 45% reported incorporating climate risks into financial planning. Over three-quarters claimed to have initiated energy-efficient changes, showcasing a mixed commitment to climate-related adaptations.

The broader context of these findings was reflected in a parallel survey, the Edelman Trust Barometer, which highlighted concerns about innovation management and increased polarization, particularly in Western democracies. CEOs recognized the need for a holistic approach to innovation that considers societal impacts and ensures AI’s affordability and accessibility.

In conclusion, while CEOs express cautious optimism about the global economy, they grapple with the urgent need for significant business transformations to navigate challenges posed by AI and climate change. The surveys underscore the complex interplay between economic optimism, technological disruption, and the imperative for responsible innovation.