Geopolitical Risks Now Top Priority for CEOs

The latest EY-Parthenon CEO Outlook Survey has found that 56% of CEOs consider geopolitical risks the biggest business risk over the next 12 months. This sharp focus on geopolitical risks isn't surprising, given the current global landscape.

But what's interesting is that despite these risks, business leaders remain focused on profitability, resilience, and long-term growth. About 82% of CEOs say they now prioritize disciplined growth over rapid expansion.

"CEOs are focusing more on careful growth and long-term change using AI and smart business deals, even though there's more risk from world politics and the economy. In times of uncertainty and many problems happening at once, CEOs don't give up. Instead, they want to make their businesses stronger and more profitable by growing carefully and learning from past problems," the report stated.

The survey, which covered 1,200 CEOs across 21 countries, shows that 46% of CEOs say high energy costs linked to geopolitical tensions are making business operations more difficult. However, rather than halting expansion plans, companies are becoming more selective in spending and investment decisions.

Olufemi Alabi, EY-Parthenon West Africa Leader, noted that "Even with many challenges, CEOs in West Africa and beyond aren't slowing down. They've learned from past problems and now plan carefully where to grow. They know the world is always changing, so they want to be ready for anything by growing in a smart and steady way."

Artificial Intelligence (AI) also emerged as a major priority, with 80% of CEOs planning to increase AI investments in 2026. Only 1% intend to reduce spending, while nearly half, 48%, say acquisitions and divestments are being driven by the need for stronger AI capabilities.

The report further showed that 89% of CEOs expect to pursue more deals in the next year, including acquisitions, partnerships, and joint ventures, with AI and long-term growth strategies driving most transactions.

As CEOs see AI as a tool to help workers do better, not replace them, 42% plan to train workers in new skills. They want to help workers develop skills that are compatible with AI. 44% want to change jobs so people and AI work together. The real challenge, though, is teaching workers new skills to use AI well, according to Alabi.

The shift in priorities among CEOs reflects a broader recognition of the need for businesses to adapt to a rapidly changing world. As global events continue to unfold, it's clear that CEOs are taking a cautious yet proactive approach to growth. They recognize the importance of both resilience and innovation in navigating the challenges ahead.

The connection to Nigeria is evident through the perspective of Olufemi Alabi, highlighting the strategies of CEOs in West Africa. This indicates that the trends observed globally are also relevant in the Nigerian context. Businesses in Nigeria are seeking to grow in a smart and steady way despite the challenges. They're using strategies similar to those used by CEOs globally.

What happens next will depend on how effectively CEOs can balance the need for growth with the requirement for resilience in the face of geopolitical risks. The ability to leverage AI and other technologies will be crucial in this endeavor. The capacity to foster a workforce that can adapt to the changing demands of the global economy will also be crucial.

The survey paints a picture of CEOs who are proactive, adaptive, and committed to long-term growth. It's a strategy that acknowledges the risks of the current geopolitical landscape while emphasizing the potential for innovation and progress.

The future of business will likely be shaped by how well CEOs can navigate these complexities. They'll need to leverage technology and talent to drive growth that is both sustainable and resilient. CEOs won't be able to achieve this alone - they'll need to work with their teams to develop strategies that are tailored to their businesses' unique needs.