CEO Confidence Drives Growth Amid Global Shifts: Insights from EY Parthenon's Guerzoni

The pulse of corporate leadership is a critical barometer for investors, and EY Parthenon’s latest CEO sentiment research underscores how confidence shapes strategic decisions in an era of technological and geopolitical upheaval. With global GDP projected to grow 3.1% in 2024, the findings reveal a stark divide between bold, confident CEOs and their more cautious peers.

The Confidence Divide: M&A as a Growth Catalyst

The most striking revelation is the outsized role of CEO confidence in driving mergers and acquisitions (M&A). 59% of top-quartile confident CEOs plan acquisitions in the next 12 months, compared to just 16% of the least confident. This confidence gap isn’t merely theoretical—it’s reflected in real-world activity. Global M&A deal values hit $1.8 trillion in the first half of 2024, a 17% increase over 2023. The data suggests that investors should prioritize companies led by executives who view M&A as a strategic lever.

Tech Adoption: A Double-Edged Sword

Confident CEOs are also leading the charge in integrating emerging technologies, with 55% prioritizing AI and automation to build competitive advantages. However, this comes with risks. Misalignment with business goals or rapid tech obsolescence could derail progress. The report highlights that 85% of highly confident CEOs embed geopolitical and regulatory risks into tech decisions, suggesting investors should favor firms with clear, risk-aware innovation strategies.

Geopolitical Risks: A Strategic Litmus Test

While tech and M&A dominate headlines, geopolitical risks are a silent driver of CEO behavior. 38% of CEOs canceled transactions in 2024 due to political or regulatory uncertainty, underscoring the premium placed on leaders who navigate these challenges. The most confident CEOs are 85% more likely than their peers to integrate geopolitical risks into core decisions. This bodes well for regions like the U.S. (semiconductors, sustainability incentives) and Germany (high-end manufacturing), which scored highest in investment appeal.

Regional Investment Hotspots

The report identifies five key markets for capital allocation:
1. U.S.: Policy support for tech and sustainability.
2. U.K.: Tech and life sciences hubs.
3. Canada/Mexico: North American integration benefits.
4. Germany: EU funding for green manufacturing.

Investors should monitor sectors like semiconductors (), renewable energy, and cybersecurity in these regions.

Guerzoni’s Insights: Agility Over Certainty

Andrea Guerzoni, Global Vice Chair at EY Parthenon, emphasizes that today’s leaders must embrace “agile, iterative strategies” over rigid annual plans. His analysis highlights the importance of:
- Continuous portfolio reviews to shed underperforming assets.
- Cross-functional teams aligning finance, R&D, and operations.
- Scenario planning for geopolitical shocks, using tools like “virtual doppelgängers” to model risks.

Conclusion: Confidence as the New Alpha

The data is clear: confident CEOs are outperforming their peers by leveraging M&A, tech, and geopolitical awareness. With global GDP growth projected to rise to 3.2% in 2025, investors should prioritize firms led by executives who:
- Act decisively in M&A (e.g., companies in high-growth sectors with strong deal pipelines).
- Invest wisely in AI without overextending (55% of CEOs prioritize this, but execution matters).
- Have geopolitical risk frameworks to avoid transaction pitfalls.

The U.S., Germany, and Canada stand out as top markets, while sectors like semiconductors and green tech offer growth catalysts. As Guerzoni notes, confidence isn’t just a mood—it’s a strategic advantage in an uncertain world. For investors, following the lead of these CEOs could mean capturing the next wave of gains.