Cybersecurity is CEOs’ main concern in 2021

April 08, 2021

Half of the CEOs surveyed by KPMG’s “2021 CEO Outlook Pulse Survey” believe that the recovery of the businesses they run will only occur in 2022. In the opinion of 24% of these leaders, the pandemic has changed their business forever. And they will need to address key trends such as cybersecurity, regulatory risks, tax risks and supply chain risks. The survey listened to 500 leaders of the most influential companies in the world, operating in 11 key markets.

Other issues are also of concern, such as reductions in office space and the need for new remote work arrangements. Several major companies have announced plans to resize or recalibrate their office space in the coming years to accommodate a more hybrid work style at the office and at home.

Microsoft, Twitter, Facebook, Salesforce and Spotify are just a few of the companies that have indefinitely extended remote work concessions or announced a permanent, long-term move to remote work first.

Companies are definitely transforming key aspects of their workplace and service delivery, with 61 percent saying they will develop their digital communication and collaboration tools. More than half (57%) plan to conduct customer service and engagement predominantly through virtual platforms, such as chat bots, telephone, web and social media.

A sizable majority of leaders were forced to accelerate new digital business models and find new revenue streams (69 percent). For that, they bet on the development of a perfect digital experience for customers (56 percent).

Three-quarters (74 percent) of business leaders reported that the digitization of their operations and the creation of a next-generation operating model were imposed in a matter of months.

Cybersecurity is the biggest risk

For this year, CEOs plan to spend more on digital technologies than in last year, with 52% prioritizing cybersecurity and data security measures. Cyber security risks are now seen as the biggest threat to organizations in the next three years. The issue jumped from fifth place to first place in six months.

Working from home and interacting with customers remotely increased exposure to potential attacks and also the possibility of being attacked by strangers, which can be much more damaging to your people and the company. Organizations will need to implement safeguards to prevent violations, as well as have consistent incident response plans.

Half of the CEOs will also continue to invest in customer-centric technologies and 49% intend to improve digital communications, such as video conferencing and messaging capabilities.

They will also have to look for ways to increase their digital resources: 61% say their appetite for mergers and acquisitions in the next 3 years will be driven mainly by the desire to acquire digital technology to transform customer experience or value proposition.

Insufficient vaccination worries

In addition, as they chart a path to recovery, these leaders know that they need to focus on maintaining the benefits of lessons learned during the pandemic and mitigating new risks.

“The pandemic was also a catalyst for CEOs to assess the role their companies play in society,” explains Bill Thomas, global president and CEO of KPMG International. Many have given voice to issues they may not have publicly commented on – from combating climate change to supporting the diverse communities in which they operate – and we need to continue to hear those voices. Almost half of the leaders participating in the survey (49%) plan to implement more stringent environmental, social and governance practices.

Almost 90% of respondents are focused on ensuring the sustainability and climate change gains their companies have achieved as a result of the pandemic, and 96% are looking to “increase their focus on the social component of their ESG programs”.

Along these lines, before any major decisions are made, CEOs want to make sure that their workforce is protected from this virus.

The safety of their team dominates CEOs’ plans to operate in the new business landscape. More than half (55%) of them say they are concerned that not all of their employees will have access to the Covid-19 vaccine, which could put their operations or certain markets at a competitive disadvantage.

Nearly two-thirds (61%) of CEOs heard by KPMG will wait for successful vaccine implementation in major markets before asking staff to return to the office.

Respondents also expressed concern about how to monitor those who have been vaccinated or not. A significant majority (90%) of CEOs intend to ask employees to report when they were vaccinated, which will help organizations to consider measures to protect their workforce. And 21% also plan to ask customers and visitors to their facilities if they have been vaccinated.

Prudently, three quarters (76%) of companies will expect governments in important markets to encourage companies to return to normal, while only 5% will do so based on the actions of their competitors. And many intend to take a cautious approach to business travel, with 26% planning to reduce international travel by the end of the pandemic.

About KPMG CEO Outlook Pulse SurveyThe 2021 CEO Outlook Pulse Survey asks CEOs of the most influential companies in the world to provide their 3-year perspective on the economic and business landscape, as well as the ongoing Covid-19 pandemic. Five hundred CEOs from 11 major markets (Australia, Canada, China, France, Germany, India, Italy, Japan, Spain, the United Kingdom and the USA) were surveyed from January 29 to March 4, 2021. All respondents have annual revenues higher than US$ 500 million and 35 percent of companies surveyed have more than US$ 10 billion in annual revenue.