CEOs wary of global, regional risks: PWC survey

The survey indicates that businesses are looking to avoid simple export models, with the globe facing economic volatility, and are looking to design new products specifically for local markets, said Prasan Chauphanich, executive chairman of PwC Thailand.

Last year brought the sovereign debt crisis in Europe and a series of natural disasters.

About 56 per cent of 1,258 CEOs surveyed in 60 countries said their organisations were financially impacted in 2011 by the euro zone’s sovereign debt crisis, 29 per cent by Japan’s massive earthquake and tsunami, and 21 per cent by the political unrest in the Middle East.
Many organisations were adversely affected by last year’s devastating floods in Thailand as well, the survey found.

Regional risks have emerged, while global economic volatility is a common threat to business growth across all regions from North America to Australia, it said. Specific risks to the Asia-Pacific region are currency volatility and energy costs.

Companies need to be well-prepared and well-equipped with business continuity plans for any uncertainties, the CEOs said.

“Economic, social and political conditions vary by country, and a more subtle understanding of how these factors will shape the business environment is critical to spotting new opportunities and managing unexpected risks,” PwC said. Human resources are core assets for any organisation. |About 51 per cent of CEOs surveyed planned to increase their headcounts over the next 12 months.

Currently, CEOs would rather grow and recruit more local talent and develop from within than import it, due to higher efficiency and lower costs. Seventy per cent of the CEOs plan to recruit primarily local talent wherever they have market needs. “Relocation costs are high and there are cultural difficulties that may disrupt efficiency,” Prasan said.