Growing sense of preparedness and a surprising optimism amongst Canadian
CEOs and their global peers
TORONTO, Jan. 24, 2012 /CNW/ - Nearly half (48%) of the 1258 CEOs polled
worldwide believe the global economy will decline even further in the
next 12 months, according to PwC's 15th Annual Global CEO Survey. Just 15% said the global economy will improve during 2012. The outlook
was almost identical for the 130 Canadian CEOs who responded to this
year's survey, with 48% seeing a decline over the next year and only
13% believing the market will improve.
However, Canadian CEOs believe their organizations have been less
affected by global turmoil than leaders in other countries. For
instance, while the sovereign debt crisis was cited as the key global
issue to affect Canadian businesses, a reduced number of Canadian CEOs
(38%) said the crisis had an impact on their operations this year
compared to 56% of CEOs globally. Similarly this held true for other
significant global events, including the Japan earthquake and nuclear
crisis (18% compared to 29% globally) and the political upheaval in
Arab economies (14% compared to 21% globally).
"In general, CEOs in Canada believe their companies have greater
resilience and growth prospects than their global peers," says Gino Scapillati, PwC's National Managing Partner, Markets. "Compared to other leaders, Canadian CEOs found their companies to be
less affected financially by major 2011 crises events."
Moreover, 43% of Canadian CEOs said they are 'very confident' of revenue
growth for their companies in the next 12 months (compared to 40%
globally), down slightly from 50% last year - though still up from the
36% who were 'very confident' in 2010.
In addition, 56% of Canadian CEOs increased their headcount over the
past 12 months while only 17% noted a decrease. More than half of
Canadian CEOs expect to increase their headcount over the next 12
months (54%), slightly higher than leaders from the rest of the world
This doesn't mean Canadian CEOs aren't worried. Sixty-six per cent had
some concern about uncertain or volatile economic growth (compared to
80% globally), 55% about government responses to fiscal deficits and
debt burden (66% globally), 50% about instability in the capital
markets (64% globally) and 46% about exchange rate volatility (58%
As a result, 66% of Canadian CEOs plan to make changes to their strategy
in the next 12 months (70% globally), driven primarily by customer
demand (79%) and economic growth forecasts or uncertainty (74%).
Competitive threats (72%) and the availability of talent (50%) were
cited as other reasons, and more often by Canadian CEOs than other
leaders (56% and 34% respectively).
"Canadian CEOs may be in a better position to adjust their business
strategy and operations to face whatever comes their way because of
greater economic stability compared to many of their counterparts
around the world," says Scapillati.
Cost reduction remains a key focus for Canadian CEOs. Although last year
only 55% of CEOs said they expected to initiate cost cutting measures
in the next year, 82% of this year's respondents reported that they had
in fact cut costs in the last 12 months. For the next 12 months, 66% of
CEOs globally say they will cut costs compared to 73% in Canada.
Mergers and acquisitions (M&A) are seen as the best strategic growth
opportunity by Canadian CEOs (25%), followed by new product or service
development (23%). Globally the focus is on increasing market share in
existing markets (30%) and similarly on new products and services
(28%). Only 12% of CEOs globally saw M&A as the main opportunity for
Interestingly, compared to their global counterparts, Canadian CEOs
believe emerging markets are somewhat less important than developed
markets to their company's prospects. Fifty-five per cent of Canadian
CEOs disagreed that emerging markets are more important to their growth
than developed economies, compared to 24% of CEOs globally.
For PwC's 15th Annual Global CEO Survey, 1,258 interviews were conducted
in 60 countries in the last quarter of 2011. In Canada, 130 CEOs were
surveyed. 291 interviews were conducted in Western Europe, 440 in Asia
Pacific, 150 in Latin America, 236 in North America, 88 in Central and
Eastern Europe, and 53 in the Middle East & Africa.
The full survey report with supporting graphics can be downloaded at www.pwc.com/ca/ceosurvey. Copies are also available from the media contacts.
Follow the discussion on Twitter with #ceo_survey.
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