Trade and geopolitics, as well as supply chain shakeups, are among the top concerns of CEOs in 2025.
In addition, CEOs are also concerned about a recession, and the challenge of implementing artificial intelligence (AI) in operations. The data points, from a study conducted by The Conference Board after the U.S. elections last November, surveyed 1,722 C-suite executives and board members, including 508 CEOs.
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Nearly half of the CEO respondents said intensified trade wars are leading conflict-related geopolitical business risk in 2025. Tensions between the U.S., E.U., and China also contributed to concerns over an increased risk of conflict in the Asia-Pacific, particularly among manufacturing CEOs. And while the fighting in the Middle East and war in Ukraine don’t appear yet to have significant impact on current operations, the CEOs said that could change should those conflicts expand.
Given the global political instability and threat of escalating trade tensions, plus lessons from the pandemic-era disruptions, The Conference Board report found a renewed urgency around the need for supply chain resilience. Globally, 78 percent of CEOs said they plan to alter their supply chains over the next three-to-five years. Almost 90 percent said their primary motivations for changing supply chains include risk reduction, cost reduction, proximity to customers, and the greening of supply chains. However, exiting China appears not to be a supply chain solution for most companies.
Global CEOs also said higher energy prices were the top economy-related geopolitical risk, particularly in Japan and Europe, while more than half of U.S. CEOs said the size of the U.S. national debt was their chief economy-related geopolitical risk. While the fear of an economic recession or downturn lingers, that concern lessened with 43 percent identifying it as a high impact issue for 2025 versus 53 percent in last year’s study.
Investing in technology, including AI, is a primary strategy for growing profits. For U.S. CEOs, the focus is on the customer experience, while globally, increasing automation was cited as the number one priority. Accelerating digital transformation, including AI, was cited as a top internal priority for CEOs globally this year as more than one-third surveyed said they expect rapidly advancing AI technology to be an organizational game change in 2025. But what could present a hitch to those plans is how to integrate AI into their operations. The respondents said that lack of expertise, integration with existing systems and quality of AI output are the top implementation challenges.
