Page 14 - AeM_March_2021

RESEARCH, ANALYSIS & TRENDS

and productive businesses, able to withstand future This represents only a marginal increase in the context
shocks." of COP26, which is being held this year in Glasgow,
UK. The finding also comes in the context of rising anx-
CEO confidence in revenue growth re- iety about nearly all types of threats.
bounds to the long-term average
Climate change still only ranks ninth among CEOs' per-
CEOs are more optimistic about the outlook for their ceived threats to growth. Furthermore, another 27% of
businesses. Some 36% of those polled said they are CEOs report being "not concerned at all" or "not very
"very confident" about their organization’s prospects for concerned" about climate change. This may be be-
revenue growth over the next 12 months, up from 27% cause climate change is not seen as an immediate
of CEOs in 2020. threat to growth compared to other issues such as the
pandemic, over-regulation, and cyber threats.
While global confidence is up, there is wide variation
across industries, reflecting the varying degrees to Meanwhile, 39% of the CEOs polled believe their or-
which consumer behavior has been impacted by the ganization needs to do more to 'measure' their environ-
pandemic. CEOs in the technology and telecommuni- mental impact. And 43% believe their organization
cations sectors show the highest levels of confidence at needs to do more to 'report' on it, a greater share than
45% and 43%, respectively. Meanwhile, CEOs in the any other disclosure area. This is encouraging as more
transportation and logistics (29%) and hospitality and and better corporate information on environmental im-
leisure (27%) sectors are among the least confident pact is key to driving the change needed to get to a net
about their ability to grow revenues over the next 12 zero economy.
months.
However, 60% of CEOs have not yet factored climate
US extends its lead over China as the top risks into their strategic risk management activities,
destination for growth which is concerning as climate change poses increas-
ing physical and transitional risk for business. At a
The survey findings show that the US has extended its country level, CEOs in countries with high exposure to
lead as the number one market that CEOs are looking natural hazards such as India and China are some of
to for growth over the next 12 months at 35%, seven the least prepared for climate change risk.
percentage points ahead of China at 28%. In 2020, the While 23% of CEOs plan to significantly increase in-
US was only one percentage point ahead of China.
vestments in sustainability initiatives because of COVID
New political developments and existing tensions have -19, almost one third of CEOs are planning no change
had an impact on the views of US CEOs. They are re- at all.
ducing their emphasis on China as a growth driver and Bob Moritz said: "To address the biggest challenges
increasing their focus on Canada and Mexico; com- facing our world today, we need to change the incen-
pared to 2020, US CEOs' interest in the latter two coun- tives that drive decision-making. This requires the fi-
tries rose by 78%. Meanwhile, China CEOs report nancial markets taking a broader view of value, beyond
growing interest in large economies such as the US, solely financial return and short-term value, so capital
Germany, and Japan—prime destinations for exports.
will flow to the right places. Better and comparable non-
financial corporate reporting is crucial too, so stake-
At 17%, Germany holds on to its number three spot on
the list of growth destinations, while the UK, post- holders can see how companies are creating value for
Brexit, moves up to number four (11%), surpassing In- society and our planet, as well as meeting their finan-
dia (8%). Japan also rises up the ranking to become cial objectives. Companies that get this right will en-
the sixth most attractive growth destination, overtaking hance their brand and build trust with their stakehold-
Australia which held that position last year. ers."

In the year of COP26, climate change is not Worries about cyber, tax policies and mis-
being approached with urgency information on the rise
Not surprisingly, pandemics and health crises top the
The percentage of CEOs expressing concerns about
climate change has risen from 24% in 2020 to 30% in list of threats to growth prospects, overtaking the fear of
2021. over-regulation, which has been the perennial number
one concern for CEOs globally since 2014.

14 March 2021: Data Privacy & Ethics in Marketing