85% of Irish CEOs confident about their organisation’s revenue growth despite economic concerns - PwC 2023 Irish CEO Survey

85% of Irish CEOs are confident about their company’s prospects for revenue growth in the year ahead despite economic concerns (Global: 89%). At the same time, over half (52%) of Irish CEOs believe that economic growth in Ireland will decline over the next 12 months (73% of global CEOs say the global economy will decline); 33% of Irish CEOs believe Ireland’s economy will improve in the year ahead (18% of global CEOs believe the global economy will improve). 

This is according to PwC’s 2023 Irish CEO Survey published today which polled 87 Irish CEOs who were part of 4,410 global CEOs surveyed in 105 countries in late 2022. This press release reports on the Irish results. 

The study reveals that Irish CEOs are seeing multiple direct challenges to profitability within their own industries over the next 10 years. More than half (53%) see changes in regulation impacting profitability followed by labour/skills shortages (51%), technology disruptors (advanced tech, AI, metaverse, blockchain etc) and changing customer demand/preferences (49%). 

Over a third (34%) of Irish business leaders believe that employee resignation/retirement rates will increase in the year ahead (Global: 36%). 

Irish CEOs planning to invest to ensure future viability

Over one in five (21%) Irish CEOs think that their organisation will not be economically viable in a decade if they continue on the current path and do not transform; almost twice as many global CEOs (39%) are of the same view.

Irish CEOs recognise that if their organisations are to remain viable in the long-term, they must invest in their people and technological transformation agendas to empower their workforces. The survey reveals that more Irish CEOs are planning investments in these critical areas compared to global counterparts in the year ahead: automating processes and systems (Ireland; 82%; Global: 76%); Upskilling the workforce in priority areas (Ireland: 80%; Global: 72%) and deploying advanced technology such as cloud, AI, robotics and blockchain etc (Ireland: 71%; Global: 69%). 

Inflation and macroeconomic volatility become top concerns, displacing climate change, cyber and health risks   

The impact of the economic downturn is top of mind for Irish CEOs, with inflation (38%) and macroeconomic volatility (26%) leading the risks weighing on CEOs in the year ahead. Close behind, 22% of Irish CEOs also feel financially exposed to geopolitical conflict. Climate change (9%), cyber risks (8%) and health risks (8%) have fallen significantly in relative terms compared to last year when they were the top concerns. 

The war in Ukraine and concerns about geopolitical conflict have caused many Irish CEOs to rethink aspects of their future business models.  Many are taking action to mitigate against this exposure including increasing investments in cybersecurity/data privacy (49%), diversifying product/service offerings (46%), adjusting supply chains (41%) and re-evaluating market presence or expanding into new markets (35%). 

Irish CEOs are cutting costs but not headcount or compensation 

In response to the current economic climate, Irish CEOs are looking to cut costs and spur revenue growth. 78% have already cut operating costs or are considering to do so in the year ahead; 75% have already raised prices of products/services or are considering to do so in the year ahead. 

At the same time more Irish CEOs are less inclined to cut headcount or compensation than global peers. 79% of Irish CEOs say they do not plan to reduce the size of their workforce in the next 12 months (Global: 60%). The vast majority  – 89% – do not plan to reduce staff remuneration in order to retain talent and mitigate workforce attrition rates (Global: 80%). 71% will not implement hire freezes (Global: 56%). 

Feargal O’Rourke, Managing Partner, PwC Ireland, said: “Despite the many uncertainties and risks impacting our economy, the survey suggests that Irish CEOs are confident about their own businesses - Irish CEOs are also more confident about Ireland's economy than global CEOs are about the global economy which may well be due to the relative strength of the Irish economy at the moment. Re-evaluating their operating models, continued investment in critical areas and putting their people front and centre are key to ensuring resilience. 

“And while there are headwinds, Ireland’s economy remains in a good position.  With strong fiscal returns, continued foreign direct investment flows, a thriving export sector, high employment levels and indications that inflation may be easing, there are solid reasons why Irish CEOs have a more positive outlook than many of their global peers.   

“For business leaders, striking the right balance between mitigating immediate threats and reinventing their businesses for the future will be a key ingredient for sustainable business growth.”

Irish CEOs taking more action on climate risks than global peers

While climate risk does not feature prominently as a key risk (9%) in the year ahead compared to last year (46%), Irish CEOs still see climate risk impacting key areas of their businesses and are taking action. 69% of Irish business leaders confirmed that their company has already made a net zero commitment or are working towards making this commitment, up from 55% last year. At the same time, over half (57%) stated that climate change will impact their cost profiles from a very large to a moderate extent, higher than global CEOs (49%). 34% of Irish CEOS said it will impact their supply chains.  

Recognising the impact climate change will have on business and society over the long-term, more Irish CEOs have already taken action or are in the process of taking action to prepare for climate change risks compared to global peers.  For example, 77% said that they have or are in the process of implementing initiatives to reduce their company’s emissions (Global: 66%); 73% said they have or are in the process of innovating new, climate friendly products or processes (Global: 61%) and 76% said they have or are in the process of developing data-driven, enterprise-level strategy for reducing emissions and mitigating climate risks (Global: 58%).  

Despite an increasing number of countries now having some form of carbon pricing, over half (51%) of Irish respondents said they still do not plan to apply an internal price on carbon in decision-making (Global: 54%); 38% do not plan to implement initiatives to protect their company’s physical assets and/or workforce from the impact of climate risk (Global: 36%). 

Ciarán Kelly, Advisory Leader, PwC Ireland, concludes: “Climate change will remain one of the biggest long term challenges for our planet and consequently businesses, but it will also bring opportunities. It is encouraging to see that over two-thirds of Irish business leaders confirmed that their company has already made a net zero commitment or are working towards making this commitment.  There is no doubt that still greater action is needed and the survey suggests that Irish business leaders are prioritising these actions. 

“The risks facing organisations and society today cannot be addressed in isolation. CEOs must therefore continue to collaborate with a wide range of public and private sector stakeholders to effectively mitigate those risks, build trust and generate long term value - for their businesses, society and the planet.”