Geopolitical instability has change into the dominant concern for world enterprise leaders, prompting a shift in company technique in direction of profitability, resilience and focused progress, in keeping with the newest EY-Parthenon CEO Outlook Survey. The quarterly examine, primarily based on responses from 1,200 CEOs throughout 21 nations, means that executives are adapting to what they see as a chronic interval of structural uncertainty by tightening their concentrate on disciplined funding, synthetic intelligence and strategic transactions. Greater than half of respondents, 56 p.c, recognized geopolitical danger as probably the most vital risk to their enterprise over the following 12 months, representing an increase of 28 proportion factors since September 2025. The findings point out that geopolitical pressures are actually shaping boardroom priorities extra straight than in earlier years.
This shift is mirrored in operational issues. Practically half of these surveyed, 46 p.c, stated that sustained power value shocks would create vital challenges for his or her organisations, underlining the extent to which geopolitical developments are translating into monetary and operational dangers.
Regardless of this backdrop, the survey means that firms should not retreating. As a substitute, CEOs report that they’re responding by strengthening resilience and specializing in profitability, drawing on expertise from earlier intervals of disruption.
Eighty two p.c of respondents stated they’re prioritising sustainable long-term progress and a transparent path to profitability over speedy enlargement. This method features a better emphasis on monetary flexibility, streamlined operations and funding in know-how, alongside a extra selective method to capital allocation.
The findings level to a broader shift in direction of what the report describes as disciplined progress. Quite than pursuing scale for its personal sake, firms are specializing in focused investments which are aligned with long-term technique and able to delivering returns in unsure circumstances.
AI. What else?
Synthetic intelligence stays a central aspect of this technique. The survey discovered that 80 p.c of CEOs plan to extend AI funding in 2026, whereas only one p.c count on to cut back spending. The outcomes recommend that AI continues to be seen as a key driver of competitiveness throughout sectors and areas.
The main target, nonetheless, is shifting. Quite than prioritising preliminary adoption, firms are more and more seeking to generate enterprise-wide impression from AI. Respondents reported that AI is already contributing to areas comparable to buyer worth creation, cited by 42 p.c, operations at 41 p.c, technique at 41 p.c and innovation at 40 p.c.
AI funding can also be influencing company transactions. Practically half of respondents, 48 p.c, stated they’re pursuing acquisitions or divestments to speed up entry to know-how or AI capabilities. This displays a rising tendency to make use of dealmaking as a way of constructing technological capability.
On the similar time, the survey highlights a variety of constraints on AI adoption. Thirty p.c of CEOs stated that regulatory frameworks are rising compliance and operational complexity, whereas 38 p.c recognized fragmented and evolving regulation as a barrier to scaling AI successfully.
Workforce technique can also be evolving in response to AI. Whereas issues about job displacement have been extensively mentioned, the survey suggests that the majority CEOs are specializing in adapting roles fairly than decreasing headcount.
Virtually all respondents, 99 p.c, stated they count on AI to alter their workforce technique over the following three years. Nonetheless, solely 20 p.c stated that AI would result in a discount in hiring, a lower from 46 p.c in 2024.
As a substitute, firms are investing in expertise and organisational change. Forty two p.c of CEOs stated they anticipate large-scale reskilling and upskilling of staff, whereas 44 p.c reported that they’re redesigning roles to mix human and AI capabilities.
The findings point out that expertise constraints stay a big problem. One in 5 respondents recognized restricted AI and information expertise throughout the workforce, together with inadequate management functionality to handle AI-driven change, as their foremost people-related points.
Alongside funding in AI and expertise, firms are persevering with to pursue transactions as a part of their progress technique. The survey discovered that 89 p.c of CEOs planning mergers and acquisitions count on their deal exercise to extend over the following 12 months, though the method is turning into extra selective.
Quite than focusing totally on scale, organisations are putting better emphasis on strategic match and functionality constructing. AI is a key issue on this course of, with 48 p.c of respondents citing the flexibility to reinforce know-how or AI functionality as an important consideration in portfolio choices. This was adopted by alignment with long-term progress priorities, cited by 47 p.c.
The survey outlines a spread of transaction methods being thought-about by CEOs. Sixty two p.c of respondents stated they’re pursuing mergers and acquisitions, whereas 57 p.c are specializing in strategic alliances. Joint ventures are being explored by 45 p.c, and 42 p.c count on to undertake divestments.
Geographically, the USA stays the first vacation spot for deliberate M&A exercise, adopted by India, the UK, Canada and Germany. The findings recommend that firms are concentrating on markets that supply alternatives for progress and entry to know-how.
