CEOs face sleepwalking into reputational disaster through a concerning over-confidence which masks inadequate crisis planning to mitigate modern day risks, new research released today shows.
Amid continued global and domestic economic pressures, the detailed research conducted by Censuswide and commissioned by leading communications company, The PHA Group, questioned 150 CEOs across the UK’s £240bn professional services sector on confidence and planning in navigating business critical issues.
Examining issues from workforce management and whistleblowing to climate change and regulation, CEOs from law firms, insurance, finance and accounting, consultancy and recruitment conveyed confidence but also revealed a lack of investment and planning.
The study showed bosses were least confident in handling:
Gen Z’s demands for higher pay and more workplace benefits
Productivity being hit by the climate crisis
Greenwashing accusations.
The research suggested handling cyber threats as a looming issue in professional services firms. Less than half (43%) of CEOs were very confident in their businesses' ability to navigate the threat of deepfakes (impersonations of the leadership team) or malicious AI content that could cause reputational and commercial harm over the next 12 months. Fewer than a third of bosses told us they a real plan to manage AI deepfake attacks, with more female CEOs (just under 40%) showing preparedness than men (25%).
Three quarters (75%) of CEOs do though have a communications plan for a cyber-attack that reveals commercially sensitive information or personal details of clients. Accounting and finance, and insurance firms were among the least prepared on this issue.
The research showed very few CEOS (just 25% of those asked) have built into crisis plans measures to deal with fraud/financial mismanagement and executive pay scandals.
Despite clear concern over climate change - 48% CEOs are worried that the climate crisis will impact their business - just 17% are investing in sustainability initiatives in the next 12 months to reduce their company’s carbon footprint. Just over half (55%) said their firm would switch to renewables.
Tackling Gen Z’s workplace demands was the area of least confidence for all the CEOs researchers canvassed. The threat of losing or not being able to access talent also looms large for professional services: (21%) CEOs want new schemes to tackle labour shortages, and a slightly higher portion (23%) want support with ensuring universal lifelong learning.
Notably, female professional services CEOs are far more prepared than their male counterparts to respond to a crisis in labour shortages and industrial action, (89% of females prepared versus 72% males).
CEOs confidence and readiness was more aligned around risks of geopolitical conflict (79% vs 80%), inflation (77% vs 79%), or the onset of another global pandemic (both 74%). Where they are lacking is on robust communication plans to address these issues, with between 20-30% organisations having no communications plan for them.
Stuart Skinner, Managing Director at The PHA Group, comments “CEOs can't cover every challenge on their own and it's no wonder many feel underprepared. Those with strong management support from within, and expert, external strategic consultancy will have a significant advantage. We are seeing more and more demand from professional services firms for guidance on how to establish and communicate their position on these big issues, both to their own employees and the general public. In a current period of political and economic flux, that trend is only likely to continue.”
