SA’s most important partners
China, UK, US and India
SOUTH African chief executives have named the UK, US, China and India as the most important countries for their respective companies’ growth in the next 12 months, according to PwC’s latest Annual Global CEO survey.
The global survey, which PwC released at the World Economic Forum annual meeting in Davos yesterday, included interviews with 36 South African chief executives, drawn from a broad spectrum of listed and unlisted companies. Overall, the survey was based on interviews with 1 379 chief executives from 79 countries.
Speaking at the release of the survey in Johannesburg yesterday, PwC Southern African chief executive Dion Shango said that for a long time Africa had been regarded as a high growth area. But as a result of a drop in commodity prices “Africa has fallen somewhat”. He said it was surprising to have the UK and the US high on the list. The survey included mining companies which were looking for markets for their commodities.
Of the South African chief executives, 83 percent were confident about their companies’ prospects for revenue growth over the next 12 months, while 58 percent expected their headcount to increase over the same period and 14 percent planned to cut their workforce, PwC said.
“It is positive to note that local chief executives expect to increase their headcount in the next 12 months. Chief executives are promoting talent diversity and inclusiveness. They have implemented strategies to reflect the skills and employment structures needed for the future,” Shango said.
The chief executives’ planned activities in the next 12 months consisted of organic growth, cost reduction and joint ventures.
PwC said the chief executives were concerned about economic and policy threats. These included exchange rate volatility, unemployment and “geopolitical” uncertainty.
He said the chief executives were also concerned about availability of skills, volatile energy costs and changes in consumer behaviour. “Concern about skills has more than doubled in 20 years – from 31 percent in 1998 to 77 percent this year,” PwC said.
It said local chief executives were taking pragmatic steps to recruit, retain and develop talent. These included promoting talent diversity, moving talent to where it was needed and changing “people strategy” to reflect future skills and employment structures.
“Looking forward, chief executives will require a different set of skills. The events of the past year have shown us just how interconnected the interests of shareholders and other stakeholders really are.
“Those businesses that articulate their purpose, anticipate risks and adhere to the value they profess will thrive. Businesses that ignore the power of the people will jeopardise the growth they seek,” said Shango. He said there were chief executives who felt that there had not been enough investment in infrastructure. “The question is which infrastructure?”
Shango said that there had been significant investment in roads and power infrastructure. He, however, said there were people not satisfied with broadband infrastructure. “But the basic infrastructure, which we use every day, seems to be working well,” he said.
Approximately 61 percent of the chief executives said technology had either completely reshaped or had significant impacted on competition in their industry, while 75 percent said technology would have a major impact in the next five years.
Anton van Wyk, partner at PwC, (left) and Dion Shango, PwC Southern Africa chief executive, while briefing the media at their Annual Global CEO survey held in Melrose Arch, Johannesburg. The survey was released in Davos yesterday.