The majority of Canadian CEOs interviewed for PRICEWATERHOUSECOOPERS’ (PwC) 10th annual GLOBAL CEO SURVEY are “very confident” that revenues will grow over the next 12 months. Fifty-nine per cent of Canadian respondents and 52% of global respondents share this level of confidence. Respondents expect this business expansion will be fuelled by improved market penetration, geographic expansion, and mergers and acquisitions (M&A).
However, 88% of Canadian CEOs cite the lack of skilled labour followed by downturns in major economies (68%) and over-regulation (61%) as key threats that may hinder their business growth prospects. Globally 73% of CEOs claim over-regulation as their main threat, followed by lack of skilled labour (72%) and low-cost competition (66%).
The biggest growth opportunity cited by all CEOs is better penetration of existing markets for existing products (23%) with access to new markets via geographic expansion a close second (21%). Canadian CEOs cite M&A as the major opportunity to grow their business (21%). However, only 18% of Canadian CEOs have actually completed a deal. The main obstacles that they experienced or anticipate encountering in their M&As include unexpected costs, conflicting workforce expectations and stakeholder opposition. Eighty-one per cent of Canadian CEOs named North America as the location for planned or completed M&As. Nineteen per cent cited Western Europe, followed by 7% in Asia.
When dealing with employee recruitment and retention the survey found that 70% of Canadian CEOs felt that active engagement in social issues is a key success factor versus 65% of their global counterparts. However, given their interest in social issues and the volume of recent political and media attention, a surprising 76% of Canadian CEOs said that they were either “not at all” concerned or “not very” concerned with the threat of global warming and climate change and its impact on the growth prospects for their companies. Fifty-nine per cent globally shared that sentiment.
The survey went on to find that nearly three quarters of CEOs from around the world, including 81% of Canadian CEOs, agree that continued globalization is beneficial for both developed and emerging markets.
“CEOs around the world, at companies large and small, are increasingly positive about their ability to grow their companies and take advantage of the opportunities globalization offers for new markets, new products and new customers,” says Ajay Chadha, Canadian leader of PwC’s merger integration and business transformation practice. “And today, with strong economic indicators, high liquidity and favourable financial markets we should continue to see robust M&A activity.”
The PwC Global CEO Survey is based on surveys completed by 1,100 CEOs from 50 countries. The survey may be read in its entirety at www.pwc.com/ceosurvey.