86% of Chief Executive Officers sampled by accounting and auditing firm, KPMG, believe a global recession will happen over the next 12 months.

However, 58% feel it will be mild and short, whilst 76% have plans in place to deal with it.

In its 2022 CEO Outlook, KPMG said the CEOs are however ready and prepared to weather the current geopolitical and economic challenges while still anticipating long-term global growth.

“Despite geopolitical and economic challenges, global economic confidence over the next three years
has rebounded from early 2022, rising to 71%”, it stated.

Also, the report said geopolitical uncertainties will likely continue to impact strategies, with 81% of CEOs adjusting or planning to adjust their risk management procedures.

But in spite of short-term recession fears, the increased confidence CEOs have for the longer term indicates they feel well prepared to navigate their businesses through turbulent times.  In fact, when asked about their confidence in the resiliency of the global economy over the next 6 months — a period
likely to be fraught with uncertainty and constant change — 73% still had a positive outlook, up 13 percentage points from February 2022.

Top risks looking forward

The report said the Covid-19 pandemic fatigue and economic factors — including the threat of rising interest rates and inflation — top the list of most pressing concerns for CEOs today at 15% and 14%, respectively.
“As we look to the next three years, risks are more interconnected than ever. Emerging technology (not
seen in the top five last year) rises in rank as the top risk and greatest threat to organizational growth”.

Operational, regulatory and reputational concerns also jumped into the top five.

Managing geopolitical risk

The report again said Strategic alliances (26%), organic growth (22%) and managing geopolitical risks
(20 percent) top the list of the most important strategies for achieving organisational growth
objectives over the next 3 years.
The CEOs indicate that geopolitical uncertainties will continue to impact their strategies and supply
chains over the next 3 years. In fact, 81% of CEOs have adjusted or plan to adjust their risk management procedures considering geopolitical risk, and 21% of CEOs will be increasing measures to adapt to geopolitical issues to achieve their growth objectives.

With geopolitics a key agenda item in 2022, the survey stressed that the CEOs need to be
knowledgeable on the subject and how to navigate the risks, adding, “it’s important to make a geopolitical risk assessment part of their overall strategy.