Cautious economic optimism amongst Belgian CEOs, yet concern for climate change increases significantly

• CEOs display optimism about continued economic resilience and their own organisation’s revenue growth prospects;
• Cybersecurity (55%), health risks (50%) and climate change (37%) are the top threats Belgian CEOs worry about; mostly related to potential revenue disruption. The extreme concern for climate change increased with nine percentage points compared to last year;
• Yet only a third of Belgian CEOs (28%) made net-zero commitments, well above the EU (23%) and global (22%) average.

Monday 17 January 2022 - As we near the two-year mark of the pandemic, the global economy seems to have rebounded from the depths of mid-2020. The 4,446 CEOs from 89 countries, including 46 Belgian CEOs, that took part in our 25th annual global CEO survey display optimism about continued economic resilience. Yet threats, uncertainties, and tensions abound, with cybersecurity, health risks and climate change being Belgian CEOs’ (and CEOs worldwide) main concern. “We're at a unique crossroads in time. Only brave choices can lead to positive change for the generations to come”, says Axel Smits, Chairman of PwC Belgium.

Cautious optimism in economic resilience

As we near the two-year mark of the pandemic, the global economy has rebounded from the depths of mid-2020. The IMF projects global GDP to grow 4.9 percent in 2022, a downtick from the 5.9% growth expected in 2021, but still strong. This is reflected in this year’s CEO survey: 80% of Belgian CEOs believe that global economic growth will improve over the next 12 months, similar to last year (82%). Another 81% of Belgian CEOs believe that the economic growth of Belgium will improve in the next 12 months. Their optimism extends to their own organisation: 93% of Belgian CEOs are confident about their own company’s prospects for revenue growth over the next 12 months and another 91% expressed confidence about this prospect in the next three years.

The survey was in the field during COP26, which convened world leaders to try to prevent the worst effects of climate change. Just two weeks after our field work closed, news of the Omicron variant reverberated around the world - raising fresh questions about the course of the pandemic and about society’s ability to continue the slow climb to normalcy.

Threats on the horizon

The threats that CEOs are most worried about and the impact they see those threats having on their business in the next 12 months reveal leaders under pressure to deliver top-line results. Belgian CEOs are most worried about the potential for a cyberattack (54%), health risks (50%) or climate change (37%) to undermine the achievement of their company’s growth prospects and the potential for all these threats to disrupt revenue growth.

As for cyber risks, Belgian CEOs fear it could inhibit their ability to innovate (63%) over the next 12 months. At the same time, health risks are still disrupting business: Belgian CEOs seem significantly more worried about health risks (50%) compared to the EU average (42%) and certainly compared to neighbouring countries France (30%), Germany (31%) and the Netherlands (26%). Coming in a close fourth on the threat list is CEOs’ concern about macroeconomic volatility, including fluctuations in GDP and unemployment, and inflation. For the latter, it is mainly energy prices that are pushing inflation to historic levels.

Rising interest in ESG, but strategy remains driven by business metrics

Despite rising interest in ESG - environment, social and good governance issues - strategy is still primarily driven by business metrics. Although Belgian CEOs’ extreme concern for climate change went up in the last year with nine percentage points (28% last year), the survey shows that greater progress needs to be made to achieve global climate goals, as just 28% of Belgian CEOs’ organisations have made net-zero commitments, above the EU (23%) and global (22%) average. Very few CEOs are avoiding commitments out of a belief that their stakeholders (internal and external) don’t care about climate change, or because they couldn’t afford to do it. That’s consistent with the perspective of CEOs who have made net-zero commitments: meeting customer expectations was the number two motivator identified by CEOs, behind only their overall desire to mitigate climate change risks. An important barrier to making commitments, is that they are uncertain about how to measure and manage decarbonisation (55%).

On the people front, attention is still more short term-focused. Concerns about the ability to attract and retain talent are mostly associated in the minds of CEOs with health risks (62%) and social inequality (69%). Most CEOs have goals related to customer satisfaction (76%), employee engagement (70%), and automation or digitisation (61%) included in their long-term strategy, all non-financial outcomes that are intertwined with day-to-day business performance. Much less well-represented, in strategies and compensation, are targets related to greenhouse gas (GHG) emissions (57%) and workforce gender representation (48%) or racial and ethnic diversity (26%).

“Through 25 years of the Global CEO Survey, we’ve seen CEOs tackle challenges from the bursting of the dot-com bubble to the global financial crisis. Today, new challenges with the global pandemic and climate change are testing CEOs like never before. Yet, no matter the issue or year, one constant we see is the fundamental importance of establishing trust.

Rapid, business-driven progress seems unlikely without system-wide change. Rebuilding trust will be crucial to help change the game and create a window to accelerate positive change. Still, there's an enormous opportunity in front of us to use the disruption to reengineer the economy more fundamentally.

We're at a unique crossroads in time. Only brave choices can lead to positive change for the generations to come.If we want to prepare our country for the future challenges, we need a more long-term vision for our country with a compelling narrative that helps us push forward. We can choose to focus on the opportunities in front of us, to rise to meet our own high expectations, and to work together towards a better future”, concludes Axel Smits.

About the 25th CEO Survey

PwC surveyed 4,446 CEOs in 89 countries and territories in October and November of 2021, including 46 CEOs in Belgium. The global and regional figures in this report are weighted proportionally to country or regional nominal GDP to ensure that CEOs’ views are representative across all major regions. The industry- and country-level figures are based on unweighted data of the full sample of 4,446 CEOs. Further details by region, country and industry are available on request. Ninety-four percent of the interviews were conducted online and 6% by post, by telephone or face-to-face. All quantitative interviews were conducted on a confidential basis.