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BRUSSELS, Feb. 27, 2024 /PRNewswire/ -- While two-thirds of Europe's CEOs plan to change their supply chains in the next two to five years, less than 2% plan to exit China, according to a new report from The Conference Board. The appetite to disengage from China is less popular among European CEOs than among their peers in any other region surveyed.
Instead, CEOs looking to change their supply chains are focusing on diversifying suppliers in friendly countries and using technology/AI to improve performance tracking. Of CEOs making changes, nearly half (45%) cite supply chain resilience and reduced risk of disruption as the two biggest motivators. Greening supply chains is the third most important reason, cited by 34% of CEOs in Europe, a much higher number than in other regions.
The Conference Board's report, Leading for Tomorrow: Europe Edition, is based on data from the organization's annual C-Suite Outlook, which reflects the views of more than 1,200 executives, including more than 630 CEOs. Participants weighed in on the top business threats and opportunities in 2024. Respondents primarily came from four regions: the United States, Latin America, Japan, and Europe.
"Despite significant concerns about rising geopolitical tensions, European business leaders are very reluctant to exit China," said Sara Murray, CEO of The Conference Board International. "At the same time, they are more interested than their peers in other regions in reorienting supply chains towards friendlier countries. This double bind reflects Europe's comparatively weak competitive position at the moment. According to our conversations with CEOs, China continues remains a market opportunity that cannot be ignored for European companies, and many senior executives are focused on defending their operations in China from global disruptions. After decades of investing in China and building their market position, most do not is willing to move away from China's industrial ecosystem.
Report highlights include:
RECESSION AND DEBT
Amid weak growth prospects for 2024, CEOs fear a recession.
Concerns about a global financial crisis are greater in Europe than elsewhere:
The cost of debt rises on the agenda:
GEOPOLITICAL UNCERTAINTY
European CEOs worry more about geopolitics:
HUMAN CAPITAL
European CEOs are interested in maintaining and improving the hybrid work environment:
Strengthening organizational culture and attracting and retaining talent are essential:
"European business leaders clearly feel more concerned about the impact of global disruption than their counterparts elsewhere. At the same time, there are some bright spots in the data: European CEOs are leading the way in AI implementation , with high expectations that it will drive important productivity gains that European CEOs are urgently seeking. European CEOs are also more positive about the transition to renewable energy than in the United States. Overall, it's a picture mixed for the European economy," explained Dino Panitsas, economist at The Conference Board. Europe.
About The Conference Board The Conference Board is the member-driven think tank delivering Trusted Insights for What's Ahead™. Founded in 1916, we are a nonpartisan, nonprofit entity that holds 501(c)(3) tax-exempt status in the United States. www.ConferenceBoard.org
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