By Peter Egwuatu
As companies continue to navigate the current COVID-19 pandemic environment and its unprecedented disruption, business executives have began to reset their strategies with eyes on achieving corporate transformation.
This is one of the highlights of the 23rd edition of the EY Global Capital Confidence Barometer survey (CCB23), released by Ernst & Young, EY.
Commenting on the outcome of the survey, Damilola Aloba, EY Partner, Strategy and Transactions (SaT), noted that for many business leaders, the emergence of the COVID-19 pandemic and the resultant economic shock, have acted as existential threats to their businesses.
According to Damilola, the C-suite has responded by resetting their strategies and making far-reaching changes with a focus on transformation. These bold moves are now fueling an optimistic mindset and a strategic agenda firmly focused on capturing growth opportunities. Companies plan to not only restore performance levels, but to also make the necessary investments to reframe their future.”
According to the report, 23 per cent of business leaders who participated in the survey expect return to pre-pandemic levels of profitability in 2021, while 44 per cent expect return in 2022, marking improved sentiment among the C-suite compared to CCB22 (March 2020).
In terms of geographical prospect for growth 39 per cent of the respondents expect Europe to generate the most growth and opportunities over the next three years, followed by Asia-Pacific with 30 per cent and the Americas with 24 per cent.
In terms of factors that could put growth prospects at risk, 29 per cent of the executives cite impact of the COVID-19 pandemic as the biggest threat while 19 per cent cite the changing global economic environment, and 14 per cent indicate climate change as top threat.
The report further revealed that geopolitical challenges have forced 81 per cent of respondents to alter their strategic investment plans in the past 12 months. Nearly two-thirds or about 64 per cent of the respondents said they have delayed a planned investment, while more than a third about or 36 per cent have terminated their plans altogether.
As the C-suite plans for a post-pandemic business landscape, 86 per cent of the executives said they have conducted a comprehensive strategy and portfolio review in 2020. For two-thirds about 66 per cent of that group said this was unplanned and a direct response to changing events, according to the findings.