Bancherul - BANCI / ENGLISH / PwC Romania CEO Survey: Romanian CEOs are cautious about the evolution of the economy, but optimistic about the perspectives of their companies for revenue growth

The employees, clients and improving the organizational efficiency are the main themes on the personal agenda of the Romanian CEOs, according to this year’s edition of the PwC Romania CEO Survey, launched today at a special event that enjoyed the participation of the Labour Minister, Mariana Câmpeanu, as well as several Romanian CEOs such as Sorin Mândruţescu, CEO Oracle Romania and President of AmCham Romania, Robert Arsene, CEO Agricover, Dan Şucu, CEO Mobexpert, and Henrik Nenzen, General Manager, Ford Romania, according to a PwC statement.

Also, the report shows that local CEOs are cautious about the evolution of the economy, with 42% anticipating a stagnation of the global economy, while 32% anticipate a turn for the worse of the economic climate. However, they are more optimistic about the growth perspectives of their companies, with 34% stating that they are very confident in their company’s capacity for revenue growth, while 52% declare that they are somewhat optimistic. Yet, compared with last year’s results, there is a slight decrease in optimism about the perspectives for growth of the companies. At the 2011 edition of the Romania CEO Survey, 43% of the local CEOs declared themselves very confident in their companies’ ability to generate revenue growth.

“It is clear that the Romanian CEOs have accustomed to the idea that, although from a technical point of view, the recession is over, the crisis is still with us, and the “new era” will be characterized by high volatility and uncertainty. There is a feeling among the Romanian and global business community that this is the new normal and that companies have no choice but to grow new life skills for the current market environment”, stated Vasile Iuga (photo), Country Managing Partner, PwC Romania.

In what concerns the threats for the business environment, the local business leaders indicated the volatility of the economy (64%), that of the capital market and of the exchange rate (59%). The worries expressed one year ago regarding a possible increase in taxation as a consequence of the Government’s hunger for cash have somewhat eased, yet it remains a serious concern (50% in 2012 as opposed to 67% in 2011).

One of the main concerns of the CEOs is the lack of the talented human resources needed in order to implement the business strategy. 50% of the local business leaders are worried about recruiting and retaining high potential middle managers. Also, 20% of the respondents said that they could not implement a strategic initiative due to the lack of the talents needed to make in reality, while 25% said that they could not pursue a business opportunity.

In what concerns the expectations from the public authorities, CEOs want the Government to focus on developing the country’s infrastructure (70%), ensuring the stability of the financial system (41%) and fostering a skilled workforce (27%).

The CEOs bet on the development of new products and services in order to increase the revenues of their companies (36%). Other opportunities for growth identified were the increase of the market share in existing markets (25%) and expansion on a new geographical market (14%).

As most of the major adjustments to business strategies have been already made, CEOs are now more eager to keep the course steady and work on the fine-tuning, rather than experiment radical change. Caution is the name of the game, only 5% of the respondents saying that they will change the strategies of their companies in the next 12 months, 55% anticipating some adjustments, while 36% stating that they will make no change.
“The financial crisis that started in 2007-2008 originated in the private sector. It lead to a sharp contraction of the economy and forced the governments everywhere to try to intervene in order to protect the safety of the financial system and maintain a socially acceptable level of unemployment. Now we are entering a new and more complex phase, especially in Europe, in which states have turned from saviours to patients. In the mean time, the private sector has managed to adapt quite fast to the new environment. Companies everywhere turned to deleveraging and cost control. Some have managed to stockpile an impressive amount of liquidity in their coffers and profitability has been restored. It is clear that companies now feel better prepared to face come what may. Yet this might just as well be an illusion of safety, with very few top managers curious to discover what might happen in the case of a meltdown of the Eurozone.”, concluded Vasile Iuga.

Survey Methodology:

For PwC's 15th Annual Global CEO Survey, 1,258 interviews were conducted in 60 countries in the last quarter of 2011. 291 interviews were conducted in Western Europe, 440 in Asia Pacific, 150 in Latin America, 236 in North America, 88 in Central and Eastern Europe, and 53 in the Middle East & Africa. For Romania, 44 interviews were conducted with local CEOs. The full survey report with supporting graphics can be downloaded at www.pwc.com/ro/ceosurvey.