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Figure 1: CEOs’ personal priorities include spending more time with customers and developing leaders
Q: Do you wish that you personally could spend more time, less time or the same amount of time on each of the following activities?
Net priority (% of respondents reporting ‘More time’ minus % of respondents reporting ‘Less time’)
Develop leadership and talent pipeline
Meet with customers
Improve organisational efficiency
Set strategy and manage risks
Develop operations outside of my home market
Personal time or community service
Meet with regulators and policy makers
Meet with lenders and providers of capital
Meet with the board and shareholders
%
66
66
57
51
40
34
5
-4
-5
Operations
People
Governance
Base: All respondents (1,258)Source: PwC 15th Annual Global CEO Survey 2012
#'' 01%&'2))-(,'!,#3(,'456'7-"+.8'9:09
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2><)#$,.*B.?.)%='@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@@ [`
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456='(>"#=='(,,'".B/#)=C'.V>.D%'A#"'%&.'M/**,.'5(=%'()*'2A"/>(@
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S';/,,/(?'M>H(33'EEE'4&(/"?()C'Y".=/*.)%'()*'456''O&.'b()B-("*'!"#-D'E)>@!"#$%&'($)*$&$'+#,-.%#/$%)01$2#+3$
5"*(,'c("(?.">()'Y".=/*.)%'()*'456'
-0$2"#$+#1-)0$4$-0$5)+2"$6*+-'&$&0,$$
Figure 2: Half of CEOs expect the global economy to decline in 2012
Q: Do you believe the global economy will improve, stay the same, or decline over the next 12 months?
15%4%
34%
48% 36%
Improve
Stay the same
Decline
Don’t know
Base: All respondents (1,258)Source: PwC 15th Annual Global CEO Survey 2012
%'' 01%&'2))-(,'!,#3(,'456'7-"+.8'9:09
456='(".'?()#.-+"/)B'%#'#-%D(>.'%&.'>#?D.%/%/#)'()*'%&.'?("<.%C'"(%&."'%&()'".,8/)B'#)'"/*/)B'.>#)#?/>'-D*"(A%='#"'N-=%'"/*/)B'#-%'+#,(%/,/%8@'O&.8'(".').(",8'%&"..'%/?.='?#".'
B.)."(%.'B"#$%&'/)'%&./"'3-=/).=='%&()'%&.8'(".'/)'%&.'B,#3(,'.>#)#?8F='B"#$%&'D"#=D.>%=@'
=..?='-)A#-)*.*@'O&.'-)A#,*/)B'5-"#d#).'>"/=/='(,#).'/='>".(%/)B'?#".'"##?'A#"'*/=(DD#/)%?.)%@'7#'$&(%'*#.='%&/='D(%%.")'?.()J'7&#-,*'$.'$#""8'%&(%'%&.'>&("%'=-BB.=%='$.'?/B&%'3.'A(>/)B'9::\'(,,'#+."'(B(/)C'D."&(D='$/%&'()#%&."'>"/=/='D".>/D/%(%/)B'('?(==/+.'A(,,'/)'3-=/).=='(>%/+/%8J''2A%."'(,,C')#%'.+."8#).'>()'#-%D(>.''%&.'?("<.%@'
Y#==/3,8C'3-%'$.'*#)F%'%&/)<'=#@'E)'#-"'
B"#$%&'/='&#,*/)B'-D'3.>(-=.'#A''%&"..'/?D#"%()%'()*'".,(%.*'%".)*=e
!"#$%&'("$)"&*)#+$,-.$%/,-+0&/1,%*&-+$1,.#$*-$2'+*-#++$1&.#3+$+*-)#$45567$;/%&'=%"#)B."'3(,()>.'=&..%=C'/?D"#+.*'>#=%'=%"->%-".='()*'('B".(%."'($(".).==''#A'B,#3(,'"/=<=C'456='(".'?#".''D".D(".*@'O&.8'*#)F%'%&/)<'B"#$%&''$/,,'3.'.(=8Z'3-%'%&.8'*#'3.,/.+.''%&.8F".'?#".'".(*8'A#"'%-"3-,.)>.''%&()'%&.8'$.".'A#-"'8.("='(B#@'
!"#$/*+#$*-$*-8#+%1#-%$,-.$)&11#/)#$%&$,-.$0/&1$#1#/(*-($#)&-&1*#+$9$?#".'D"#)#-)>.*'%&()'/)'()8'D."/#*'#+."'%&.'D(=%'*.>(*.'G'>".(%.='+(=%'?("<.%'D#%.)%/(,@'Q(,A'#A'456='3(=.*''/)'*.+.,#D.*'?("<.%='3.,/.+.'%&(%'.?."B/)B'.>#)#?/.='(".'?#".'/?D#"%()%'%#'%&./"'>#?D()8F='A-%-".C''(='*#'X\a'#A'456='$&#'(".'%&.?=.,+.='3(=.*'/)'.?."B/)B'?("<.%=@'O&.'$#",*'
D"#3,.?=C'3-%'%&/='=%"->%-"(,'=&/A%'/='D#%.)%/(,,8'3/BB."'%&()'%&.'/)=%/%-%/#)(,'D"#3,.?='()*'*.D".==.*'B"#$%&'/)'*.+.,#D.*'.>#)#?/.=@'!"(*-(,,8'"/=/)B'/)>#?.='()*'.>#)#?/>'#DD#"%-)/%/.='
K"/()']-D."".(-,%C'Y".=/*.)%'()*'456C'M("=&'f'M>g.))()'4#?D()/.='E)>@
$$
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Figure 3: Short-term confidence has declined – but remains well above the levels seen in 2009 and 2010
Q: How confident are you about your company’s prospects for revenue growth over the next 12 months? Yearly comparison.
Very confident about company’s prospects for revenue growth
over the next 12 months
26%
31%
41%
52%50%
21%
31%
48%
40%
0
10
20
30
40
50
60%
2012201020092008200720062004 20052003 2011
Base: All respondents (2012=1,258; 2011=1,201; 2010=1,198; 2009=1,124; 2008=1,150; 2007=1,084; 2006 (not asked); 2005=1,324; 2004=1,386; 2003=989)Note: Percentage of CEOs who are very confident about their companies’ prospects for revenue growthSource: PwC 15th Annual Global CEO Survey 2012
'01%&'2))-(,'!,#3(,'456'7-"+.8'9:09' &
A#"'?/,,/#)='?#".'D.#D,.'("#-)*'%&.'$#",*'&(+.'.)#"?#-='/?D,/>(%/#)='A#"'/)A"(=%"->%-".'=D.)*/)BC'=-=%(/)(3/,/%8'%.>&)#,#B/.=C'*.?()*'A#"'&.(,%&'>(".C'
D"#*->%=C'()*'%&.',/=%'B#.='#)@'
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
()*'&-?()T'%#$("*=').$'#DD#"%-)/%/.='()*'%&.'A-,,'D#%.)%/(,'#A'('A("'?#".'>,#=.,8'/)%.B"(%.*'$#",*'>#?.='%#B.%&."@'456='3.,/.+.'%&(%'%&.'A#">.='#A'B,#3(,'/)%.B"(%/#)'$/,,'=%(8'#)'%"(><e'h1a'3.,/.+.'%&.'$#",*'$/,,'3.>#?.'?#".'#D.)'%#'A"..'/)%.")(%/#)(,'%"(*.'R$/%&'A.$."'%&()'('%&/"*'.VD.>%/)B'('D-,,3(><T'()*'1Xa'(".'>#)+/)>.*'%&(%'
-)*."').$'>#)=%"(/)%=@'
2='('".=-,%'#A'%&.=.'A(>%#"=C'3-=/).==',.(*."=F'>#??/%?.)%'%#'*#/)B'?#".'3-=/).=='B,#3(,,8'/=C'/A'()8%&/)BC'(>>.,."(%/)B'*.=D/%.'.>#)#?/>C'".B-,(%#"8'()*'#%&."'-)>."%(/)%/.=@'_/=<='(".'$./B&%.*'%#$("*='.>#)#?/>'()*'/)'D("%/>-,("'D#,/>8'%&".(%='/)'9:09C'3-%'%&.'A-)*(?.)%(,='A#"'A-%-".'B"#$%&'(".'=%/,,'=i-(".,8'/)'D,(>.@'K-=/).==.='&(+.'(*(D%.*'%&./"'=%"(%.B/.='%#'%(<.'(*+()%(B.'$&.)'%&.8'/).+/%(3,8'".(==."%'%&.?=.,+.=@
0';O6'*(%('=&#$'B,#3(,'%"(*.'".3#-)*.*'/)'9:0:'%#'".%-")'%#'/%='9::\',.+.,='R$$$@$%#@#"Bj.)B,/=&j).$=k.jD".=00k.jD"X9\k.@&%?T@'
S"()>.=>#'7%("(>.'456C'5).,'!"..)'Y#$."'7D2
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,#2#+3-0#/$7#$7-%%$"&8#$2)$.#$
Figure 4: Talent remains priority no. 1 for CEOs
Q: To what extent do you anticipate changes at your company in any of the following areas over the next 12 months?
Strategies for managing talent
Organisational structure (including M&A)
Approach to managing risk
Captial investment decisions
Focus on corporate reputation and rebuilding trust
Capital structure
Engagement with your board of directors
No change Some change A major change
%
2012
%
2011
21
26 50 22
32 50 17
38 42 19
49 35 15
55 29 14
63 27 8
55 23 17
25 47 27
23 54 23
23 48 28
36 41 22
50 34 15
52 34 12
52 31
Base: All respondents 2012 (1,258); 2011 (1,201)Source: PwC 15th Annual Global CEO Survey 2012
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Figure 5: CEOs eye the expanding buying power of emerging markets
Private consumption at current market exchange rates
20102020
Private consumption in current prices and market exchange rates, US$ millions 20
10
5
Australia
Canada
China & Hong Kong
Japan
Korea
Russia
India
Turkey
Sub-Saharan Africa
Latin America
US
EU27
ASEAN
MENA
Source: Oxford Economics
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Figure 6: Growing customer bases is far from the only objective of CEOs in their key overseas markets
Q: Which of the following objectives do you hope to achieve in the next 12 months? (The top 10 countries mentioned by CEOs in ‘Which countries, excluding the one in which you are based, do you consider most important for your overall growth prospects over the next 12 months?’)
AustraliaJapanFranceUKRussia
GermanyIndiaBrazilUSAChina
Build R&D/innovation capacity or acquire intellectual property
Build manufacturing capacity
Access raw materials or components
Access local source of capital
Build internal service delivery capacity
Access local talent base
Grow your customer base
79
55
46
14
34
30
27
87
53
49
1626
31
19
78
47
36
125
12
22
76
42
38
96
11
15
81
44
34
1021
10
29
85
49
36
1719
21
19
71
46
30
23
1917
26
83
61
55
11
31
33
22
79
61
54
1231
38
31
72
32
32
16
14
10
24
Base: China (383); USA (275); Brazil (188); India (176); Germany (152); Russia (101); UK (81); France (66); Japan (62); Australia (53)Source: PwC 15th Annual Global CEO Survey 2012
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Figure 7: A modest decline in cross-border M&A is expected in 2012
Q: Which, if any, of the following restructuring activities do you plan to initiate in the coming 12 months? Responses of ‘Complete a cross-border merger or acquisition’.
% of CEOs anticipating M&A (left axis)
Number of deals (right axis)
70
110
100
90
Num
ber o
f dea
ls (1
00 =
200
8)
% o
f CEO
s an
ticip
atin
g M
&A
80
0
40%
30%
20%
10%
2012F201020092008 2011
Base: All respondents (2012=1,258; 2011=1,201; 2010=1,198; 2009=1,124; 2008=1,150)Note: Number of deals is all completed deals where final stake is greater or equal to 20%.Source: PwC 15th Annual Global CEO Survey 2012; Dealogic
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Figure 8: Pulling away from an export mindset to meet local demand
Q: For each of the countries that you intend to grow your customer base, which of the following three statements best describes your approach to product and service development? (The top 10 countries mentioned by CEOs in ‘Which countries, excluding the one in which you are based, do you consider most important for your overall growth prospects over the next 12 months?’)
20
39
37
27
34
37
22
42
34
17
49
31
36
30
32
24
42
33
24
43
29
19
50
30
26
46
25
30
46
20
100
75
50
25
0
%
Products and services are the same as in our headquarters’ market
Products and services are modified to meet local market needs
Products and services are developed specifically for local market requirements
Germany US France Brazil Japan Australia UK Russia China India
Base: China (302); USA (195); Brazil (156); India (139); Germany (110); Russia (88); UK (63); France (50); Japan (50); Australia (45)Source: PwC 15th Annual Global CEO Survey 2012
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Figure 9: Many industries see significant pressure for both process innovations and radical innovation
Q: To what degree are you changing the emphasis of your company’s overall innovation portfolio in the following areas? Responses of ‘significantly increase’.
0
0
10
20
30
40
50
10 20
New business models
Global average
Cos
t red
uctio
ns to
exi
stin
g pr
oces
ses
30 40
19
2018
171615
14
1312
74
51
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
2
3
6
111098
Banking & Capital Markets
Business and Professional Services
Healthcare
Automotive
Transportation & Logistics
Metals
Industrial manufacturing
Retail
Consumer Goods
Hospitality & Leisure
Chemicals
Forestry, Paper & Packaging
GlobalConstruction/Engineering
Asset Management
Pharma & Life
Insurance
Technology
Communications
Entertainment & Media
Base: All respondents (29-245) Source: PwC 15th Annual Global CEO Survey 2012
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Figure 10: Global economic uncertainty remains the top threat to growth prospects
Q: How concerned are you about the following potential threats to your business growth prospects?
North America
Uncertain or volatile economic growth
Public deficits
Over-regulation
Unstable capital markets
Exchange rate volatility
Protectionism
Western Europe
Uncertain or volatile economic growth
Public deficits
Unstable capital markets
Shift in consumers
Over-regulation
Exchange rate volatility
Asia Pacific
Uncertain or volatile economic growth
Exchange rate volatility
Unstable capital markets
Public deficits
Over-regulation
Shift in consumers
Inflation
Latin America
Uncertain or volatile economic growth
Over-regulation
Exchange rate volatility
Public deficits
Bribery and corruption
Unstable capital markets
Protectionism
CEE
Uncertain or volatile economic growth
Exchange rate volatility
Unstable capital markets
Public deficits
Over-regulation
Bribery and corruption
Middle East/Africa
Uncertain or volatile economic growth
Public deficits
Over-regulation
Bribery and corruption
Unstable capital markets
Inflation
Business threats Denotes equal rankingEconomic and policy threats
Exchange rate volatility
Availability of key skills
Shift in consumers
Increasing tax burden
New market entrants
Increasing tax burden
Inability to finance growth
Availability of key skills
Energy costs
Increasing tax burden
Availability of key skills
Energy costs
Increasing tax burden
Availability of key skills
Inadequacy of basic infrastructure
Increasing tax burden
Shift in consumers
Availability of key skills
Energy costs
Availability of key skills
Increasing tax burden
Shift in consumers
Energy costs
Base: North America (236); Western Europe (291); Asia Pacific (440); Latin America (150); CEE (88); Middle East/Africa (53)Note: Rank of top threats, by % of somewhat or extremely concernedSource: PwC 15th Annual Global CEO Survey 2012
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M("/N)'].<<."=''4&(/"?()C'K(8."'2!'
Figure 11: Talent constraints have impacted costs – but also factor in lost opportunities
Q: Have talent constraints impacted your company’s growth and profitability over the past 12 months in the following ways?
Our talent-related expenses rose more than expected
We weren’t able to innovate effectively
We were unable to pursue a market opportunity
We cancelled or delayed a key strategic initiative
We couldn’t achieve growth forecasts in overseas markets
We couldn’t achieve growth forecasts in the country where we are based
Our production and/or service delivery quality standards fell
%
43
31
29
24
24
24
21
Base: All respondents (1,258)Source: PwC 15th Annual Global CEO Survey 2012
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Figure 12: Different industries, different requirements – but skills gaps remain
Q: In general, has it become more difficult or less difficult to hire workers in your industry, or is it unchanged?
Global
Consumer goods
Automotive
Healthcare
Industrial manufacturing
Technology
Insurance
Pharamceuticals & Life sciences
%
Less difficult More difficult
Sectors above the globalaverage in % of CEOs responding‘More difficult’
12 43
11 44
8 46
9 47
14 47
12 48
10 49
6 51
-16 37
-21 34
-19 28Base: All respondents (29-245)Note: Responses of ‘unchanged’ not depicted.Source: PwC 15th Annual Global CEO Survey 2012
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$$
Figure 13: Half of CEOs expect to raise their headcount in 2012
Q: What do you expect to happen to headcount in your organisation globally over the next 12 months?
Healthcare
Business services
Technology
Communications
Chemicals
Automotive
Global
Insurance
Entertainment & Media
Industrial manufacturing
Banking and Capital markets
Asset management
Consumer goods
Construction/Engineering
Retail
Pharmaceuticals & Life sciences
Transportation/Logistics
Metals
Hospitality & Leisure
Forestry, Paper & Packaging
Increase by less than 5% Increase by 5-8% Increase by more than 8%
Decrease by less than 5%Decrease by 5-8%Decrease by more than 8%
%
6 6 93138
5 6 181723
1124 191820
7 14 191224
1 11 101134
3 4 7 1026 16
22 15
3 4 11 14 1423
3 103 1225 13
5 4 10 2024 6
7 7 1511 25 8
123 63 1819
6 5 6 131321
44 15 91820
1344 1917 10
4 173 111322
5 121 111220
15 12 121017
1553 513 18
3 717 14317
10 188 81410
Base: All respondents (29-245)Note: Responses of ‘stay the same’ not depicted.Source: PwC 15th Annual Global CEO Survey 2012
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Figure 14: A minority of CEOs get comprehensive reports on their workforce
Q: When making decisions, how important is it to have information on each of the following talent-related areas? For those areas that are important to you, how adequate is the information that you currently receive?
% of CEOs who believe the relevant information is important or very important
Per
cent
age
of C
EOs
100
80
60
40
20
0Costs of
employeeturnover
Return oninvestment onhuman capital
Assessmentsof internal
advancement
Labour costs
Employees’views and
needs
Staff productivity
Information Gap:CEOs believe information is important but don’t receive comprehensive reports
Do not receive information
Not adequate
Adequate but would like more
Information received is comprehensive
Base: All respondents (1,258)Source: PwC 15th Annual Global CEO Survey 2012
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Figure 15: Recruiting and retaining high-potential middle managers is the biggest concern for CEOs
Q: With which of the following groups do you currently face the greatest challenges with regard to recruitment and retention? Respondents were able to choose all that applied.
High-potential middle managers
Skilled production workers
Younger workers
Senior management team
Overseas unit heads
%
Emerging Markets Developed Markets
5550
3531
3230
3521
1321
Base: All respondents (621; 637) Source: PwC 15th Annual Global CEO Survey 2012
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Figure 16: CEOs are more focused on recruiting local talent and developing and promoting from within
Q: With regards to plans for your global workforce over the next three years which of the following statements do you feel is more likely to occur?
We plan to move experienced employees from our homemarket to newer markets to circumvent skills shortages
We plan to develop and promote most ofour talent from within the company
We plan to primarily recruit local talentwherever we have market needs
We plan to move experienced employees from newer markets to home markets to circumvent skills shortages
We plan to recruit more experienced talent from outside the company
We plan to move more talent across borders to fill market needs
%
Agree with statement
Don’t know
Agree with statement
53 16
67 24
70 19
31%
8%
11%
Base: All respondents (1,258) Source: PwC 15th Annual Global CEO Survey 2012
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!"#$%"&$'()&"*+#,*-)(&./,0)1'2)%1#+")$')1)%.#1,$#")/.)4$(0,)5+"*,$.'*)6.&)"%"&7)8493)Highlights
Companies are getting more local about their global growth strategies.
Many are expanding capabilities in their priority markets and innovating locally to better serve new customers in new segments.
Seeking growth outside familiar markets calls for careful monitoring of ongoing risks, both at the local level and by considering their potential impacts on global businesses.
CEOs are also challenged to address talent issues more systematically and strategically in all their markets.
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Securing the talent to succeed: Making the most of international mobility in financial services
www.pwc.com/financialservices
How financial services organisations can make sure they have the right people with the right skills in the right places to realise their goals.
November 2011
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$$$@D$>@>#?j>.#=-"+.8'PwC firms help organisations and individuals create the value they’re looking for. We’re a network of firms in 158 countries with close to 169,000 people who are committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com.
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