Global CEOs rank UK most important market after US – PwC’s 28th Annual CEO Survey

• UK surpasses Germany, China and India to become the second most important destination for investment after US

• Improved confidence in economic outlook: 61% of UK CEOs anticipate economic growth in the next 12 months, up from 39% last year     

• UK CEOs ahead on Gen AI adoption - 93% have adopted it to some extent vs 83% of CEOs globally - but behind on seeing this translate to greater revenues or profit 

The UK has risen to become the second-most attractive global destination for international investment according to PwC’s 28th Annual Global CEO Survey.  This is the first time the UK has secured this spot in the 28 year history of the survey.

This shift in attitude towards the UK comes at a time when CEOs globally are looking at new sectors and markets - more than a third said they had started to compete in new sectors in the last five years - to stay competitive. 

The UK, having moved up from fourth the previous year, trails only the US in this year’s survey, with 14% of global CEOs' saying the UK will receive the greatest proportion of planned international capital expenditure. The US commands 30%, with Germany (12%), China (9%) and India (7%), making up the top five investment destinations.

Marco Amitrano, Senior Partner of PwC UK, comments: 

“Our CEO survey findings are a vote of confidence in the UK as a place for business and investment. The UK’s relative stability at a time of instability should not be underestimated, nor should its strength in key sectors including technology. However, there is no room for complacency. Reasserting Britain’s place on the global stage requires a tangible path to growth and a consistent government approach to business and investment. Business is playing its part - with two thirds of UK CEOs developing new business capabilities or operating models in the pursuit of growth.”

Looking at outward investment interest, UK CEOs have shifted their international priorities this year. While the United States, Germany and France remain the top three destinations, consistent with last year’s trend, there have been notable changes elsewhere. Investment interest in China has fallen dramatically. Conversely, interest in Australia has seen a marked increase. These shifts underscore a recalibration of global strategies as CEOs adapt to evolving risks and opportunities in international markets.

UK leads on GenAI adoption but other countries catching up

There has been a two-fold increase in GenAI adoption by UK businesses since last year’s survey. Some 93% of UK CEOs say their firms have now adopted the technology to some extent, compared with 42% the previous year. UK CEOs are still ahead on GenAI adoption compared with their global counterparts, where the adoption rate is 83%. 

Yet whereas 49% of CEOs globally expect GenAI to increase profitability in the next 12 months, only 36% of UK CEOs share the same confidence. This may be based on the experience so far - only 14% of UK business leaders have seen profitability improvements from GenAI over the last year, compared to 34% of CEOs globally.  However, more than half (53%) of UK CEOs report that GenAI has already enhanced employee efficiency, while 40% say it has improved their own time management. 

Marco Amitrano, Senior Partner of PwC UK, said:

“While many UK businesses have adopted GenAI to some degree, those degrees will vary enormously. There is a big difference between letting employees experiment with AI and embedding it into core business processes. UK business has begun to move beyond the initial hype of GenAI to the reality of making it work - but that shouldn’t detract from its huge unrealised potential. That more than a third of business leaders expect to see some financial gain from GenAI within the next year is very significant, and indeed encouraging.”

CEOs more optimistic on the economy but see the need to transform their own businesses

Some 61% of UK CEOs are optimistic about UK economic growth in the next 12 months (up from 39% in 2023), and are also positive about the global outlook (64% expect this to improve, compared with 58% of CEOs globally).  Longer-term confidence in their own business has declined slightly since the previous survey, with 57% of UK CEOs feeling very positive about their organisation’s prospects over three years, compared with 61% in last year’s survey.  

This may explain why transformation remains high on the CEO agenda - 98% of business leaders are anticipating material changes to their business model to stay competitive, with 66% focusing on developing new capabilities and 65% developing new business capabilities or operating models to address new markets or create new offerings . Workforce investment continues to be central, with 70% focused on retaining talent, 62% recruiting for new skills, and 53% reskilling existing teams.

Transformation through business model reinvention may partly explain why fewer UK CEOs are in an acquisitive mood, with those planning to make a move for another business over the next three years down to 49% from 53% last year.

Climate action and outcomes uneven

Some 87% of UK CEOs say they have initiated climate-friendly investments in the past five years. While 38% of these business leaders report revenue gains from these initiatives, 39% have seen increased costs. 

Despite challenges, sustainability is being embedded into decision-making, with over half of CEOs now tying executive compensation to sustainability metrics. This signals a growing recognition of the need to align climate action with long-term business strategies, which could in turn lead to stronger financial returns from such initiatives.

About the 28th Annual PwC Global CEO Survey 

PwC surveyed 4,701 CEOs across 109 countries and territories from 1st October through 8th November 2024. The global and regional figures are weighted proportionally to country nominal GDP. The industry and country-level figures are based on unweighted data from the full sample of 4,701 CEOs. The full findings can be accessed on pwc.com/ceosurvey.