Leaders must collaborate in face of global crises

Dog-eat-dog business will no-longer cut the mustard when it comes to the private sector addressing systemic crises such as climate change. The era of the purpose-led, collaborative leader has arrived, according to Jane Lawrie, global head of corporate affairs at KPMG International.

In KPMG’s 2023 CEO Outlook, we spoke to 1,300 CEOs at some of the world’s largest and most prominent companies. We’ve carried out this annual snapshot since 2014 and it always highlights some interesting trends. This year’s data highlights the sheer scale of the challenge facing leaders today.

The data is overwhelmingly clear that CEOs are grappling with some of the biggest challenges of our time. From the rise of populism to economic uncertainty – the board room has found itself thrust into the world of politics. Crisis is often a contentious term used hyperbolically for day-to-day challenges that can be overcome. In reality, the world right now is facing crises on multiple fronts and this has the potential to derail senior executives from achieving their long term ambitions.

Perhaps the most positive of the findings is that 72% believe a stronger focus on collaboration with shared management and operational responsibilities enables greater success. As a result of the intense pressures facing leaders to deliver growth during this challenging operational environment, they are adopting a more intentionally collaborative leadership style.

There is also optimism for the economy. Three out of four CEOs told us they remained confident about the global economy’s growth prospects over the next three years, reflecting a continued sense of resilience and focus – balanced with clear knowledge that the journey toward that growth is filled with short-term risks and threats.

In terms of risks, for the first time in our survey history, geopolitics is the top risk factor for leaders. Last year, despite the war in Ukraine already being underway, political uncertainty wasn’t yet in the top ten list for executives.

Looking at opportunities, it comes as no surprise that ESG and AI are right up at the top of the priority list for leaders; although CEOs recognise the challenges posed in these areas with CEOs particularly identifying the importance of ethical and responsible AI. In terms of ESG, there is a renewed focus on purpose reported in the findings. 69% of CEOs told us they’ve now fully embedded social, environmental and governance practices into their business as a means of value creation. However, almost three quarters acknowledged their role was becoming more politicized as they sought to fill the void of societal changes, driven by increasing awareness from the public and a decrease in trust in some public institutions.

While it’s slipped slightly in the issues list, the employee value proposition and wider war for talent remain key factors as executives juggle changing workforce expectations with a rapidly evolving global environmental, economic, and political landscape.

The survey is rich in data. In short, for the resilient, forward-looking CEO, the challenge of getting through this period of deep uncertainty is clear. How they plot the route out of it is more prosaic. Embedding purposeful, collaborative leadership into the business strategy seems to be favoured as a means of unlocking the opportunity for returning to long-term, sustainable growth.

Society is arguably more divided than ever on the answers to the problems we all face. CEOs are taking this moment to come forward and take a bold, inclusive, and robust stance, embracing equity, purpose and sustainability.