This is How CEOs Are Strategizing to Face the Economic Recession

Most business leaders believe a recession is imminent. However, a significant number of company executives have already prepared strategies to cope with it.

This is reflected in the *KPMG 2022 CEO Outlook* report released by the international accounting organization KPMG in October 2022.

"Almost 9 out of 10 CEOs believe that a recession will occur within the next 12 months. But, 3 out of 5 CEOs feel the impact of the recession will be mild, and the majority have plans to address the situation," KPMG explained in its report.

KPMG surveyed 1,325 Chief Executive Officers (CEOs) or top executives of private companies across 11 countries: the United States, Australia, Canada, China, France, Germany, India, Italy, the United Kingdom, Japan, and Spain.

This survey was conducted during July-August 2022 with CEOs from various sectors, including asset management, automotive, retail, energy, infrastructure, insurance, manufacturing, technology, and telecommunications.

"All respondents had revenues exceeding US$500 million per year, and one-third of the surveyed companies had revenues exceeding US$10 billion per year," KPMG clarified.

From this survey, KPMG found that 26% of respondents are trying to address the recession through strategic partnerships with third parties.

Others are striving to boost business growth through innovation and capital injection, mergers and acquisitions, joint ventures, and outsourcing, with details as shown in the graph.

Some are also tackling the recession with geopolitical risk management, including building new supply chains.

"With geopolitical conditions being a major issue in 2022, CEOs need the knowledge to map their risks. Geopolitical risks are important considerations in their business strategies," KPMG explained.

"The combination of uncertainty and price fluctuations is also forcing some executives to significantly alter their priorities and pivot their business models," it added.

Regardless of strategy, KPMG also found that global CEOs generally remain highly optimistic.

"Despite economic and geopolitical challenges, optimism about the global economy over the next three years has increased," KPMG concluded.