The Asian economy narrates a captivating tale — one that is robust, transformative, and influencing the worldwide economic framework. Such narrative is championed by executives who perceive 2025 as yet another year ready for economic expansion, abundant with optimism and innovation, as indicated in recent publications.
In PricewaterhouseCooper’s (PwC) 28th Annual Global CEO Survey — Asia-Pacific, approximately 55% of leaders anticipate significant advancement in the economy compared to the previous year. This assurance is mirrored in their business expectations, with 34% confident in their revenue growth forecasts and 46% intending to enhance hiring this year.
While the region displays encouraging signs for economic progress, there is also an aura of uncertainty that may cloud its prospects. The report emphasized leading concerns such as economic volatility (increasing from 21% to 32%) and the limited availability of skilled workers (rising to 25%). Additional risks encompass technological disruptions, escalating trade frictions, and severe weather phenomena, among others.
Business transformation
In such a context, CEOs are compelled to spearhead transformations within their organizations. According to PwC, business transformations involve “radically altering how a company generates, delivers, and captures value. In other words, it’s about how a company fundamentally shifts its approach to revenue generation, customer service, or new product and service offerings.” This transformation is crucial for propelling businesses forward, harnessing innovation, and unlocking new value and opportunities essential for sustained success.
Many express confidence in their company’s longevity, with 52% believing they will persist for over a decade, a significant rise from the 34% in 2024. Reflecting this growing assurance, the past five years have witnessed CEOs undertaking transformational actions such as targeting new consumer demographics, creating innovative products or services, fostering organizational synergies, exploring new market pathways, and introducing new pricing structures.
By remaining proactive, organizations are converting economic uncertainties into growth prospects that foster enduring value.
Employee skill enhancement
Having a strategic vision and investing in the workforce is viewed as a critical engine of growth. A prime example of this initiative is enhancing employee skills to keep pace with technological advancements.
As noted in Ernst & Young’s (EY) CEO Outlook Survey: Global Confidence Index, 85% of CEOs globally believe that harmonizing human talent with emerging technologies can bridge existing skill gaps and will be vital for business progress in the upcoming year.
Significantly, key distinctions in priorities among CEOs were evident: 60% concentrated on enhancing employee and customer experiences, while 40% emphasized top-line growth and margin enlargement.
“Adaptability is the ultimate advantage in today’s environment. Organizations that welcome transformation can convert disruption into opportunity by continuously learning, pivoting, and evolving to shape their future with assurance. The survey highlights that the most confident CEOs are adopting a long-term perspective on transformation, centered on improving customer and employee engagement amidst macroeconomic and technological fluctuations, always positioning humans at the core as the optimal route to sustainable value creation,” an EY report remarked.
Digital evolution
The drive for digital evolution continues to profoundly impact businesses, influencing both strategies and operational frameworks. In Asia, there’s a strong focus on investing in emerging technologies like artificial intelligence (AI) to redefine business models. This transition has resulted in increased revenue and workforce efficiency within enterprises.
According to EY’s CEO Outlook — Asia-Pacific report, 74% of CEOs feel their firms are extremely or very adept at leveraging technologies to enhance innovative work methods, and 72% express confidence in their capacity to swiftly adopt technologies for developing new business models.
Nevertheless, trust concerns regarding AI remain, as indicated by the low confidence level (37%) among executives. Consequently, as PwC’s report highlighted, numerous organizations are taking a more cautious stance.
To overcome AI-related challenges, CEOs ought to prioritize aligning AI with their corporate strategies. This entails equipping leadership teams with essential knowledge and tools, ensuring AI aligns with company goals and missions, utilizing AI agents, reengineering operational models, and implementing responsible AI practices.
“Currently, you possess high AI potential and a substantial investment level, yet not much value being unlocked. Significant AI value will only be grasped if CEOs become personally engaged, as only they can align the AI agenda with the broader corporate agenda,” stated Nicolas de Bellefonds, a managing director and senior partner at Boston Consulting Group (BCG) in an article published on the firm’s site.
Sustainability as a growth avenue
Embedding sustainability into the core of business operations and transforming it into a valuable opportunity is another critical facet of business transformation. An increasing number of leaders are acknowledging the vital role that sustainability plays, with 39% already witnessing tangible benefits from climate-friendly investments, as per PwC.
“Climate considerations are no longer merely about satisfying stakeholder demands — they are evolving into a cornerstone of investment. A considerable 87% of CEOs have initiated climate-conscious investments in the past five years,” the report indicated.
“It appears that companies in Asia-Pacific that have financially benefited from climate-aware investments tend to be large, financially resilient, and strategically committed to sustainability and transformation,” it continued.
However, the reality remains stark; and if climate action remains sluggish, climate conditions are likely to become more volatile and extreme. Thus, it is crucial to accelerate the tempo of climate initiatives.
More specifically, organizations may encounter significant financial dangers when experiencing extreme climate incidents. This risk is particularly pronounced for sectors such as agriculture, construction, communication, and utilities.
“BCG and the World Economic Forum estimate that if global warming follows its current path, extreme weather could jeopardize up to 25% of EBITDA (earnings before interest, taxes, depreciation, and amortization) within the next 25 years,” BCG’s report noted.
“While physical and transitional risks will vary according to region and industry, it is crucial that CEOs fully comprehend their current exposure — an area where many seem to be lacking,” it added.
“From our analysis, numerous companies are considerably underestimating the risks posed by climate change, particularly as catastrophic floods, hurricanes, droughts, and wildfires grow more frequent and intense.”
CEOs, therefore, have an expanded role in mitigating risks and expediting climate actions. Evaluating climate scenarios and identifying optimal strategies to reduce their firms’ exposure to risks is vital. Additionally, they should concentrate on minimizing carbon footprints, especially in high-emission sectors, and building partnerships to propel green initiatives forward. — Angela Kiara S. Brillantes