Make or break: CEOs reveal the biggest risk to business during COVID-19
Great people can take your business to the next level. Choosing the right team could be the single most important decision a business leader can make, according to a new survey.
Conducted by accounting firm KPMG, the survey found that chief executive officers (CEOs) of companies around the world consider talent risk as the “largest threat” to businesses today, ahead of supply chain and environmental risk.
The KPMG 2020 CEO Outlook is based on two surveys conducted globally, one at the start of the pandemic in January and another in July/August. In the first survey, some 1,300 CEOs were polled, while in the follow-up poll, about 315 chief executives participated.
In both surveys, all the respondents represent companies with annual revenue over $500 million. A third of those polled manage firms that have more than $10 billion in yearly revenue.
Survey results
The two polls showed that CEOs’ priorities and concerns have changed during the coronavirus pandemic, as the marketplace, as well as work and business culture, changed and existing trends like environmental, social and governance factors (ESG), flexible working and digital transformation accelerated.
When asked what the biggest threat was to the growth of their business, CEOs ranked talent risk behind 11 other risks to growth. However, in the recent survey, talent risk rose 11 places, emerging as the largest threat to businesses today.
“Since the start of the pandemic, talent has risen to be named as the most significant threat to their businesses ahead of supply chain and environmental risk,” KPMG said in a report.
According to Bill Thomas, global chairman and CEO of KPMG, business leaders are seeking to manage uncertainty with decisiveness and companies have had to act quickly to deal with the impact of the pandemic.
And when it comes to planning for the future, business leaders face more challenges, particularly when it comes to dealing with future ways of working and problem solving.
“So, it’s perhaps no surprise that CEOs are focused on the importance of talent to sustain and grow any future business,” he added.
Growth prospects, digital transformation
When asked about growth prospects over the next three years, 32 percent of CEOs are less confident in the global economy now than they were at the start of the year.
However, they are more positive about their own country’s growth prospects (45 percent confident), as well as the resilience of their own business over the coming three years.
The survey also showed that 80 percent of CEOs have seen the digital transformation of their businesses accelerating during the pandemic.
The biggest changes have been in the digital transformation of operations, where 30 percent said that progress has put them years ahead of where they would have expected to be right now.
There has also been increased focus on ESG, with 63 percent of leaders saying they have shifted the focus towards the social component of ESG during this period of global uncertainty.
Earlier this year, CEOs said their companies have a larger role to play in society. About three-quarters (76 percent) agreed that as leaders, they are personally responsible for change on societal issues.
