Global economic uncertainty: Swiss CEOs respond with stability and agility

Zurich, 15 January 2024 – Markets, technologies and regulations are extremely volatile. In its 27th Annual Global CEO Survey, PwC analysed how CEOs steer their companies through uncertain times and how they assess important issues for the future. A total of 4,702 CEOs from 105 countries were surveyed, including 79 from Switzerland. The results show that Swiss CEOs assess the impacts of the current complexity differently depending on their sector and geographical markets.

“As CEOs, we’re currently faced with a tough balancing act between profitability and responsibility,” explains Andreas Staubli, CEO of PwC Switzerland. Swiss companies are used to surviving in the volatile global market. To ensure they remain successful in the future, they must “utilise proven strengths like innovation expertise and stability – and at the same time become even more agile,” says Staubli.

Growth: positive outlooks testify to the stability of Swiss made
38% of CEOs in Switzerland forecast that the global economy will grow in 2024 (global: 38%). This is 20 percentage points more than in 2022. But at the same time, 52% of Swiss survey participants – 7 percentage points more than in the global sample – expect the global economy to decline. This polarity of opinion is evidence of the multi-layered nature of global developments. Factors such as high interest rates, inflation, the strong Swiss franc and subdued consumption are having a different impact depending on the sector and market area.

Overall, CEOs in Switzerland are more optimistic about growth than in the previous year. Andreas Staubli’s interpretation of this is “Despite geo-economic volatility, stable conditions prevail here. In terms of inflation and interest rates, as CEOs we rule out a hard landing since we can rely on the stability and agility of our companies”.

Risks: old worry becomes new number one concern
Unsurprisingly, the threat barometer for 2024 shows a new trend. 35% of the survey participants in Switzerland see cyber risks such as hacker attacks, surveillance and disinformation as the main threat to their company in the next 12 months (global: 21%). This is 12 percentage points more than in the previous year, when inflation ranked as the number one threat with 43%. In Switzerland, the effects of inflation have been relativised and are no longer seen as incalculable. With the increasing adoption of technologies and digitalisation, the focus is once again on threats to the integrity of IT systems and data.

Transformation: companies remain innovative with new technologies
90% of the CEOs surveyed in Switzerland will invest in the automation of processes and systems over the next 12 months. Product and service innovations came in second place, followed by the use of new technologies like cloud and AI. New technologies and innovations help companies replace manual labour with more cost-effective automation, operate more efficiently and quickly and improve quality by reducing errors. Many companies also embrace technologies to make them attractive to younger generations and address the shortage of skilled workers. 
51% of the CEOs surveyed have rolled out new technologies over the last five years to improve their capabilities. The same number have introduced new products and services and 33% have developed new technologies in-house. Companies in Switzerland must remain innovative in order to maintain their world-class level of innovation and absorb the strong Swiss franc.

Regulations: both a blessing and a curse
Around 49% of CEOs in Switzerland see regulatory requirements as the biggest driver of their value creation (global: 42%). At the same time, 41% consider regulations to be the biggest obstacle (global: 36%). The uncertainty surrounding the Switzerland-EU dossier is likely to be reflected in this assessment. Andreas Staubli comments, “The new negotiations with the EU will hopefully soon grant Switzerland full access to the EU internal market and its research programmes again. This is the only way we can remain a top-class location for education and innovation”.

The world of work: attracting managers and talent is becoming crucial to success
57% of CEOs in Switzerland say it is difficult to retain talent in the company. 52% find a full management pipeline to be particularly challenging. These statements are due to the ever-present shortage of skilled workers and a change in the understanding of values. Motivation and satisfaction, especially among younger employees, are increasingly dependent on a sense of purpose. This is associated with flexible working models, learning and development opportunities, a diverse and inclusive corporate culture and a more tangible corporate purpose.
58% of Swiss CEOs are leaving their headcount unchanged (global: 38%) while 29% plan to increase headcount (global: 39%). These assessments underpin the robustness of the Swiss economy. Employees are part of well-functioning, stable structures. CEOs in Switzerland want to maintain this stability.

Sustainability: a flood of regulations focusing on compliance
CEOs have recognised the need for decarbonisation. 54% of the survey participants sell products, services and technologies that support climate protection. 58% are currently delivering innovations through a climate-friendly offering. However, companies’ sustainability programmes are being subjected to a tough reality check. They have to withstand a real tsunami of regulations, which is why the focus of the academic year is on compliance. At the same time, sustainability efforts must pay off. That being said, many markets aren’t yet prepared to bear additional costs for something from which they only benefit indirectly.

Generative AI: potential recognised – but reservations remain
The CEOs agree that generative AI demands new skills and stimulates competition. They also believe it will have a positive impact on efficiency, revenue and profitability. Despite this, only 16% of CEOs in Switzerland have introduced generative AI in their company. Concerns also can’t be ignored: 70% of the survey participants are convinced that generative AI increases cyber risks in the short term, 54% fear the spread of misinformation and 44% fear legal sanctions and reputational damage. “As CEOs, we need to carefully evaluate how we use generative AI in our companies. It offers unique disruptive momentum. In this case, it pays off to introduce something as big as generative AI in small steps,” says Andreas Staubli.

About this survey
The Swiss edition of the 27th CEO Survey is based on the 27th Annual Global CEO Survey by PwC Global. The survey took place in November 2023. A total of 4,702 CEOs from 105 countries and market regions worldwide were surveyed, 79 of which are in Switzerland. Out of the CEOs in the Swiss sample, 30% represent the financial sector, 6% technology, media and telecommunications, 16% consumer markets, 24% industrial manufacturing and automotive, 14% healthcare, incl. pharmaceuticals, and 9% utilities and resources. 33% operate solely on the Swiss domestic market. 49% of the participating companies employ fewer than 500 people, 15% between 500 and 999 and 37% over 1,000. 35% of the CEOs surveyed represent companies with a revenue of less than CHF 100 million, 44% companies with a revenue between CHF 100 million and CHF 999 million and 18% companies with a revenue of CHF 1 to 25 billion. 24% are listed on the stock exchange, 25% are family-owned companies and 20% are owner-managed.