Mazars: C-suite optimistic for a year of transformation, but say more regulation and ethical considerations needed

Mazars, the international audit, tax and advisory firm, today releases its latest C-suite barometer: outlook 2024. Optimism and confidence are at their highest recorded by the Mazars C-suite barometer. Business has its eyes firmly set on a positive future, and leaders are looking to expand and grow with confidence. 

• Optimism hits a record high – 89% increased revenues vs the previous year and 94% have a positive outlook for growth expected in 2024, eight points up from last year. ​​ 
• Economic factors, including high inflation and cost of living (37%), and energy prices (33%) are two of the top external trends impacting businesses most in the coming year. The emergence of new technology (33%) is also expected to impact significantly, and businesses are confident they’re prepared for this. 
• The proportion of businesses boosting investment, averaged across all business activities, increased to 66% (up 3 points on last year), and 44% are “very confident” they can manage external trends, up 6 points from last year. 
• Transformation through IT or emerging technology is the top strategic priority for leaders for the second year running – yet three quarters of those already using generative AI in their organisation say they have ethical concerns and 95% overall say more regulatory guidance is needed. 
• International expansion increases in importance with leaders, from joint fifth to the number two spot alongside new or revised sustainability and talent strategies, second only to technology transformation as the biggest strategic priority for the coming 3-5 years (35%). 
• There’s a greater commitment shown by leaders to sustainability with more organisations reporting on their impact and more organisations budgeting costs specifically for ESG reporting. Yet, over a third of leaders (37%) say they lack in-house expertise when it comes to data and reporting on human rights – up 10 points on last year. 
• 83% of Romanian C-suite leaders look ahead with a positive mindset (17% are very positive, 39% are positive, and 27% are slightly positive).
• Organic growth (39%) remains the most important source of growth for the Romanian C-suite leaders, followed by M&A activity and strategic alliances/joint ventures with third parties (each, 22%).

Partner and member of the Mazars Group Executive Board, Mark Kennedy said: “The high levels of optimism and renewed confidence among our respondents provide a good indicator of how businesses are likely to progress this year. In the face of volatility, the C-suite has demonstrated resilience and agility enabling them to continue investment and transform business while addressing the challenges and opportunities of emerging technology, expansion plans and the ESG agenda, setting their businesses up for sustainable growth. In what may be a bounce forward year for businesses, there will still be tough decisions to make, yet we can see an increasing consciousness and confidence in the priority areas that will secure sustainable economic growth in the global economy.” 

Each year Mazars gathers the views of executives from all over the world. The 2024 outlook delivers insight into the market trends and transformations expected to impact companies, the strategic priorities on the C-suite’s agenda, the challenges and opportunities influencing growth, with in-depth insights to help prepare for the year ahead. 

Transformation in a digital world 

Transforming company IT remains top of the agenda for business leaders, with one third (32%) naming it a top strategic priority. 

The emergence of new technologies is expected to have a big impact on business, but most C-suite executives (87%) say they are confident their business is prepared. In terms of regulating new technology, 95% of leaders believe it’s essential or important to have more regulation nationally or internationally when it comes to controlling generative AI.  

This demand for more regulation and control, however, has not impacted the appetite from leaders, with 85% believing that generative AI will have an impact on their organisation and three-quarters say they’re already using generative AI internally and/or for products/services. Importantly, three quarters of those already using AI express ethical considerations about the technology. Half expect it to replace some jobs in their organisation and 57% of those say it’s already happening or will within the next year.   

The rise in international expansion as a strategic priority  

With a quarter of C-suite executives surveyed naming international expansion as one of their strategic priorities, this is the first year it’s featured in our top three. Organic growth is expected to be an important driver of expansion in 2024 with 53% of leaders. 

Top destinations named for international expansion are China, Germany and the US, with France and the UK still emerging strong. Canada also features in the top destinations where businesses plan to expand into in 2024, alongside Brazil. 

Recognising greater sustainability commitments 

The wave of sustainability expectations continues across the business world. Nearly three quarters (71%) of organisations produce a sustainability report and more are factoring this into budget planning (72%) – the highest recorded to date for both in the firm’s annual C-suite barometer. 

Data capture and quality is still the top challenge, but understanding regulation is next on the list having leapt from 21% last year to 31% this year. The arrival of new regulations, such as the EU’s Corporate Sustainability Reporting Directive, also appear to be having an impact as the challenge of understanding regulation is felt most in Europe with 35% of executives.  

Human rights is the area of sustainability reporting that shows the biggest increase among respondents confirming challenges with data capture and quality. It’s also clear that acceptance is growing in the number of leaders recognising human rights as an area they lack in-house expertise – up from 27% to 37% this year.   

The new ‘laws’ of talent attraction 

Competition in the market for talent is set to continue. Almost half of C-suite executives accept that it’s difficult to get people through the door in the first place with 44% saying they struggle to hire talent into their organisation and 30% of those confirming it’s most challenging to hire at senior executive level. As a potential risk in cultivating the next generation of C-suite leaders, executives are prioritising new or revised strategies, with more globally believing learning and development opportunities are essential to attracting the best people which will, in turn, contribute to the long-term growth of their business.

Over 83% of the Romanian C-suite leaders have a positive outlook for growth in 2024

In the last few years, crafting the right agenda has certainly been challenging for C-suite leaders, given the multitude of disruptions encountered. Nonetheless, they demonstrated strength and resilience, effectively leading their teams through difficult times.

Our previous C-suite study revealed that the Romanian C-suite leaders were optimistic about the future of their businesses, a sentiment that remains steadfast and unwavering this year as well, with over 83% of them looking ahead with a positive mindset (17% are very positive, 39% are positive, and 27% are slightly positive).

„Most probably due to the geopolitical context and the post-pandemic effects, the Romanian leaders expected no change to their 2021 revenue vs. 2020, with only 38% of them predicting growth, compared to 86% globally. Now, two years apart, things are definitely different, with local businesses being more positive; from 38%, now 94% say they’re growing, compared to 89% globally. This huge change indicates a business market optimistic for the future, confident about their development, and ready to take on the challenges ahead.”, mentioned Dino Ebneter, Country Managing Partner, Mazars in Romania.

When asked which will be their most important sources of growth in 2024, the Romanian C-suite leaders mentioned organic growth (39%), followed closely by M&A activity and strategic alliances/joint ventures with third parties (each, 22%). Dino added: „It’s noteworthy that organic growth maintained its top position from the previous year, showing that our C-suite leaders remain committed to nurturing internal capabilities and fostering sustainable growth within their companies.”

Although Romania is seen as a hub for technology advancements, the biggest strategic priority for C-suites is international expansion (39%), followed by implementing a new or revised talent attraction/retention strategy (33%). Globally, international expansion was ranked second, with technology transformation remaining the top priority.

Despite their optimism about the future, they maintain a grounded perspective, carefully considering the trends that will have the greatest impact on their businesses in 2024. These include factors such as geopolitical tensions, social unrest in countries where they operate, as well as energy prices and potential shortages.