PwC: UK increasingly attractive territory for organisation growth for Europe’s CEOs

CEOs in Europe’s biggest economies regard the UK as one of the most important territories for their organisation’s future growth - more so today than in recent years, according to PwC’s 23rd annual CEO Survey.

PwC: UK increasingly attractive territory for organisation growth for Europe’s CEOs

Kevin Ellis, chairman and senior partner of PwC UK

For Germany, France and Italy’s CEOs, the UK is as attractive now as it was in 2015, with a notable uptick since last year. In Germany, the percentage of CEOs who view the UK as one of their top three growth targets has more than doubled since last year (from 6% to 13%) to match the level in 2015.

The UK has become a more popular growth target among France’s CEOs too, with 23% saying so, the highest level since 2015 (24%), and markedly up on the interim years (14% being highest recording in 2016). In Italy, the percentage of CEOs who selected the UK is also up on last year, rising from 11% to 14%. In 2015 the figure was 12%.

Beyond Europe, the UK has become more attractive to CEOs in the US (up 4 percentage points on last year to 20%), Australia (up 6 percentage points to 19%) and Japan (up 2.5 percentage points to 11.5% - the highest level recorded). By contrast, the UK has become marginally less important to CEOs in China, India and Canada - each down by 2.5 percentage points.

Kevin Ellis, chairman and senior partner of PwC UK, said: “The findings provide timely perspective on the UK’s standing as a place to invest and do business. Viewed against the turbulent global backdrop, the UK is a beacon of relative stability.

“You can’t replicate natural advantages like our timezone and location between the US, Asia and the rest of Europe, but more than that the UK is a fair and trusted place to do business. Developing infrastructure and skills will enhance the UK’s position, and ensure its increased popularity among CEOs translates to more inbound business and investment. Likewise, maintaining an open economy and our deep connections with trading nations will be crucial.”

However, CEOs across the world have become less optimistic about their business’ revenue prospects, with only 27% saying they are “very confident” in their own organisation’s growth over the next 12 months – the lowest level since 2009 and down from 35% last year. In the UK the figures are 26% and 37 % respectively.

Looking ahead to the next three years, the figures are more positive: 35% of CEOs globally, and 37% of UK CEOs, are very confident about their business’ future growth. The vast majority of UK CEOs (90%) are confident to some degree.

The availability of key skills is the number one business concern for CEOs globally. In the UK, 79% of CEOs say they are concerned about this making it the second top business concern, trumped marginally by cyber threats (80%). While 66% of CEOs say their organisation is making moderate or significant progress on defining the skills needed to drive future growth, only 55% of UK CEOs are focused on upskilling their workforces.

Climate change has become a far greater concern for UK CEOs - rising 20 percentage points from 44% in 2018 to 64% in 2019. In 2016 only 8% of UK CEOs said they were extremely concerned about it as an issue, but this has risen to 25% in 2019. More than half (51%) of UK CEOs also recognise that finding solutions to the climate crisis presents a significant business opportunity.

The interest in the UK comes at a time of uncertainty for CEOs worldwide; for the first time more than half of respondents (53%) believe the rate of global GDP growth will decline, with trade conflicts among their top concerns.

The survey was published at the World Economic Forum in Davos.

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