The global economy is still in decline, but Canadian companies are faring well, according to PwC’s latest survey of CEOs.
Of the more than 1,200 CEOs polled worldwide, 48% said they believe the global economy will decline even further in the next 12 months, while only 15% said they expect it to improve. The outlook was almost identical for Canadian CEOs—48% said they expect a decline while 13% said the market will improve in 2012.
However, Canadian CEOs also 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, only 38% of Canadian CEOs 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,” said Gino Scapillati, national managing partner, markets, PwC. “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), and more than half expect to increase their headcount over the next 12 months (54%), slightly higher than leaders from the rest of the world (51%).
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% globally).
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 and economic growth forecasts or uncertainty. Competitive threats and the availability of talent were cited as other reasons.
“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,” said Scapillati.