Over 60 per cent of global CEOs surveyed by The Conference Board believe that their primary region of operations will descend into recession within the next 18 months.
A further 15 per cent said that their region was already in recession while just under 5 per cent predicted a recession would take place in 2024.
Only 19 per cent of the surveyed CEOs from across North America, Asia, Europe and Latin America indicated that they were not expecting a recession during the next two to three years.
“Historically high energy prices, renewed supply chain disruptions, heightened geopolitics risks, and eroding consumer confidence are all putting downward pressure on global growth,” said The Conference Board chief economist Dana Peterson.
“That’s on top of lockdowns in China and the cascading ripple effects of the war in Ukraine. These disruptions, along with restrictive monetary and fiscal policy decisions, are fueling recession expectations.”
Of all the companies surveyed, only 9 per cent suggested that the war in Ukraine would have no material impact on their business operations during the coming year.
In relation to the conflict, volatility in energy prices and higher input costs were cited by chief executives as the two biggest issues that will affect their business operations in the next year.
Passing costs onto consumers was the preferred method of managing rising input costs for 51 per cent of CEOs while 47 per cent said cutting costs.
Chief executives also raised concerns about the increased risk of retaliation from Russia through cyber attacks, of whom 43 per cent were highly concerned and 46 per cent were somewhat concerned.
“Before the war, few saw cyber security as a major issue facing their companies. Companies need to make cyber security a sustained, and not just episodic, priority,” suggested Paul Washington, executive director, ESG Center, The Conference Board.
“Cyber attacks not only imperil a company’s data, operations, and reputation, but can have far-reaching societal and environmental impacts.”
Additionally, 38 per cent of CEOs said that rising tensions between the United States and China stemming from the war would significantly impact their operations during the next 12 months.
“This challenge is contributing to intense fears of a fundamental re-alignment of the global geopolitical landscape—the potential division of the world into competing Cold War–style economic blocs, pitting the US and its allies against China and its allies (including Russia),” said The Conference Board committee for economic development president Lori Esposito Murray.
“Such a division is likely to have significant negative impact on global trade and economic growth, and business leaders are awakening to the need to prepare. Already, 60 per cent of US CEOs expect an economic decoupling over the next 5 to 10 years.”
