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PwC's Annual Global CEO Survey, now in its 28th edition, delivers critical insights into today's macroeconomic landscape as viewed by thousands of CEOs worldwide. This year marks the most extensive survey yet, featuring responses from 4,701 CEOs, including 181 from the Chinese Mainland and Hong Kong SAR. In the context of China's ongoing economic recovery and its commitment to high-quality developments, the China report highlights how CEOs are increasingly aware of the urgent need for business reinvention, particularly in view of rapid changes in AI and climate change. They are actively embracing innovative solutions to transform their business models amid significant market shifts.
In China, some CEOs are rapidly seizing the opportunities for growth and value creation driven by the defining forces of our time. They are heavily investing in generative AI, tackling the challenges and opportunities presented by climate change, and reinventing their operations and business models to generate value in innovative ways. However, many others are lagging, hindered by traditional leadership mindsets and processes that lead to stagnation.
The path forward is clear for both groups: they must choose to act decisively now—either by accelerating their transformation efforts to blaze new trails and capture emerging opportunities, or by skillfully refining their current operations with strategic adjustments, ensuring their business models remain on course in an era redefined by innovative value creation.
Among the key findings:
Cautious optimism:
CEOs from both Chinese Mainland (72%) and Hong Kong (81%), relative to their global counterparts (53%), are optimistic about their companies' business growth over the next three years, reflecting positive expectations for medium- to long-term development. Chinese CEOs share global concerns about macroeconomic volatility (41%) and inflation (38%), with higher sensitivity due to geopolitical tensions and supply chain issues.
Need for business transformation:
44% of Chinese CEOs believe their company won't survive the next decade without significant transformation, with many citing regulatory shifts and supply chain risks as key challenges to long-term viability.
Positive impact of Gen AI:
66% of Chinese CEOs have experienced efficiency gains from generative AI, with 64% noting improved profitability, significantly higher than global averages, especially in advanced manufacturing and high-value services.
Trust in AI integration:
Over half (53%) of Chinese CEOs trust embedding AI into key processes, with 48% planning to integrate it into technology platforms and 34% into core business processes over the next three years.
Headcount growth:
46% of Chinese CEOs plan to increase headcount in the next 12 months, more than double those expecting decreases. Similarly, 34% report that generative AI has led to job growth rather than losses, indicating its role in driving innovation.
Climate investment and challenges:
Climate-related investments in China have resulted in increased revenue for 61% of CEOs, aided by government incentives; however, challenges remain, including low returns on investment as a barrier to initiating these investments.
Implications for business leaders
Business model reinvention:
- Chinese CEOs must accelerate their efforts in reinvention to stay competitive amid the ongoing industry reconfiguration - a trend that is often overlooked by Chinese respondents as they are more likely to rely on core operations and existing sectors for revenue growth. A balanced approach that incorporates both outward and inward strategies is essential.
- Savvy leaders understand that strategic partnerships can generate value that exceeds what any single organisation can achieve alone. It is crucial to monitor market trends and remain alert to signs of impending industry changes, such as new competitors or shifts in market share, and to adapt proactively.
AI enablers:
- With recent breakthroughs in domestic large model development, Chinese CEOs should take advantage of the lower cost in model training and integration to streamline costs and develop new product/service offerings, while maintaining a clear focus on the long-term potential of AI.
- The positive outlook on headcount growth in China and high trust in AI technologies suggest that businesses should prioritise workforce development and training. By equipping employees with the necessary skills to leverage AI technologies, companies can enhance productivity and drive innovation.
Climate enablers:
- Many companies in Chinese Mainland and Hong Kong are now generating revenue from climate investments made over the past five years, and this trend is set to grow as China transitions toward decarbonisation.
- It is crucial to thoroughly assess your company's resource utilisation and energy consumption. This involves addressing the energy trilemma: ensuring a reliable energy supply while simultaneously reducing emissions and controlling costs.
As China sets its economic priorities for 2025, we are witnessing a profound reconfiguration of industries, driven by the interplay of technological innovation and sustainability imperatives. Businesses must seize this moment to reinvent their models, harnessing AI as a catalyst for efficiency and growth, while leveraging climate enablers to create resilient, future-ready operations. This is not just an opportunity—it's a necessity for thriving in a rapidly evolving global landscape.
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