There are also growing concerns and questions about how to position for a changing geopolitical climate. More than one-third of the China CEOs said they are reassessing their global footprint given shifting environments because of globalization and protectionism. In fact, over half of the business leaders said the uncertainty of the current geopolitical environment has had more impact on their organizations than they had seen in a number of years.
China, home to the world’s second-largest economy, is now seeing a dramatic shift in how it seeks continued growth. Once nearly synonymous with cheap labor and low-priced goods, the government is now looking for new ways to add value and growth to the economy by boosting innovation, consumption and the services sector.
On top of that, technology continues to disrupt a number of industries. And given China’s rapid rise, authorities are working to catch up with new policies and regulations.
“China’s restructuring process and an increasingly sophisticated consumer are leading to both challenges and opportunities,” KPMG China Chairman Benny Liu said in a statement. CEOs are adapting to the new environment, working to embrace innovation and disruption, he said.
What that means is a rapidly moving backdrop for companies operating in China and, as such, focusing on innovation is a key priority going forward for China CEOs.
But even as risks and challenges have arisen, top executives aren’t shying away from continued investment in a number of areas, including cybersecurity, digital infrastructure and innovation. It’s all part of wider efforts to stay one step ahead in products and business models.
The survey also found that more CEOs from the U.S. and Europe are looking to their own domestic economics to seek growth, while ones from Asia are looking to international markets. Chinese CEOs in particular are interested in Australia, Germany and the U.K. as overseas growth opportunities.
KPMG surveyed 1,261 global CEOs, 125 of whom are from China-headquartered companies, operating in 11 key industries including automotive, banking, insurance, investment management, energy, life sciences, retail and more.