Chief executives worldwide expect growth in markets such as Brazil, China, India and Russia to keep increasing and are optimistic about higher revenues at their companies, but they are concerned about over-regulation and finding enough skilled workers.
The annual Global CEO Survey, released by PricewaterhouseCoopers on Tuesday, also found that half of the nearly 1,100 chief executives surveyed were starting to shift resources toward efforts to contain risks like scarcity of oil supplies, terrorism and political instability. Global climate change was also a concern for 40%.
The report was released on the eve of the five-day annual meeting of the World Economic Forum, which has drawn some 2,500 business leaders, heads of states and other officials to its annual meeting in the Swiss Alps.
More than 90% of those polled were confident that revenue growth at their companies would keep increasing in the next 12 months. Farther ahead, 93% said they were very confident about reaching new revenue targets and growth through the next three years.
With globalization showing no signs of abating, company chiefs believe that business expansion will be helped by increased market penetration, more openings worldwide and mergers and acquisitions, many of them across borders.
"CEOs around the world, at companies large and small, are increasingly positive about their ability to grow their companies and take advantage of the opportunities globalization offers for new markets, new products and new customers," said Samuel A. DiPiazza, CEO of New York-based PricewaterhouseCoopers.
Geographically, the survey, now in its 10th year, said that most CEOs expect growth to continue to increase in markets in Brazil, China, India and Russia, along with other emerging countries, including Vietnam and Indonesia. Mexico, Turkey and South Korea are also countries lauded with potential for significant business growth.
While almost three-quarters of those polled said that globalization has helped expansion in developed and emerging economies, some 23% said that the biggest growth opportunities came from better market penetration in existing markets, while 21% cited expanding into new markets near existing ones.
Nearly 80% of the CEOs said they preferred to pay for new growth, be it acquisitions or expanding current operations, with cash on hand, while less than 20% said they would look to equity markets for support. Just 10% said they were mulling private equity or venture capital financing.
Despite the overall optimism, CEOs said there remained barriers to growth, with 73% calling over-regulation a problem, up from 64% a year ago. Concerns about attracting skilled workers were high, particularly in Asia and the Pacific, where 88% of the CEOs surveyed said they had reservations about a looming scarcity. Worldwide, 72% of CEOs said they were concerned about a lack of skills.
"If CEOs are to make the most of global opportunities for the long term, they must fully understand the realities and risks of funding their growth, working in diverse cultures, managing dispersed resources and competing with a growing set of global players," DiPiazza said.
Approximately half of the CEOs said they had completed, or were planning a cross-border merger or acquisition to drive growth, with most looking to adjacent countries.
PricewaterhouseCoopers interviewed 1,084 CEOs in 50 countries by phone -- and by mail in Japan -- during the final quarter of 2006. Face-to-face interviews were done in China and Kenya. The names of the CEOs and their companies were not released.