Global Leadership Monitor Fall 2023 - Russell Reynolds Associate

Global Leadership Monitor H2 2023

TOP EXTERNAL Threats
Availability of key talent
+
Economic uncertainty
Emerging threat
Tech change
Low leadership preparedness
Geopolitical uncertainty
Learn how these findings will impact your organization
Global Leadership Monitor Fall 2023 - Russell Reynolds Associate
% of leaders selecting each item as top 5 issues impacting organizational health in the next 12-18 months

Uncertain economic growth

68%

Availability of key talent

68%

Tech change

51%

Increased regulation

41%

Changes in consumer behavior

39%

Geopolitical uncertainty

37%

Cyber threats

29%

Policy uncertainty

28%

Commodity price volatility

26%

Climate/environmental change

23%

Economic uncertainty and the availability of key talent and skills are the joint highest-ranked threats to organizational health over the next 12-18 months—with 68% of executives selecting each issue as a top-five threat.

Technological change and increased regulation also ranked highly, with 51% and 41% of leaders considering them as top threats. Meanwhile, consumer behavior and geopolitical uncertainty appeared in leaders’ top 10 concerns.
% of leaders selecting each item as top 5 issues impacting organizational health in the next 12-18 months

Hybrid work implementation

22%

Major health threats

11%

Exchange rate volatility

10%

Trade conflicts

9%

Investor activism

9%

Heightened scrutiny of diversity/inclusion

8%

Taxation

8%

Rising wealth inequality

5%

Protectionism

5%

Populism

4%

Economic uncertainty and the availability of key talent and skills are the joint highest-ranked threats to organizational health over the next 12-18 months—with 68% of executives selecting each issue as a top-five threat.

Technological change and increased regulation also ranked highly, with 51% and 41% of leaders considering them as top threats. Meanwhile, consumer behavior and geopolitical uncertainty appeared in leaders’ top 10 concerns.

Select External Threat


Uncertain economic growth   Availability of key talent   Tech change   Increased regulation   Changes in consumer behavior   Geopolitical uncertainty   Cyber threats   Policy uncertainty   Commodity price volatility   Climate/environmental change   Hybrid work implementation   Major health threats   Exchange rate volatility   Trade conflicts   Investor activism   Heightened scrutiny of diversity and inclusion   Taxation   Rising wealth inequality   Protectionism   Populism  
While uncertain economic growth and the availability of key talent and skills have remained high on leaders’ lists of concerns over the last 18 months, technological change has experienced a 19 percentage point increase in the last year, after experiencing a dip in early 2022. In H2 2023, 51% of global leaders selected it as a top-five threat.

Increased regulation follows a similar trend: A small dip in H1 2022 followed by a steady 10 percentage point increase since H2 2022.

Cyber threats have been a relatively stable concern in previous years, but have moved higher up the agenda. Over the past six months, this threat has increased by 6 percentage points.

Major health threats and return to work have consistently decreased as threats to organizational health over the last two years.
% of leaders selecting threats as top 5 issue vs ​% of leaders reporting leadership team is prepared or very prepared

EXTERNAL THREATS

TOP EXTERNAL THREATS

L6M*

% PREPARED OR VERY PREPARED

L6M*

1. Uncertain economic growth

68%

-1%

48%

-10%

2. Availability of key talent

68%

-3%

47%

+1%

3. Tech change

51%

+8%

55%

-2%

4. Increased regulation

41%

+3%

65%

-3%

5. Changes in consumer behavior

39%

+1%

47%

-6%

6. Geopolitical uncertainty

37%

-5%

33%

-4%

7. Cyber threats

29%

+6%

68%

-3%

8. Commodity price volatility

28%

+2%

49%

-4%

9. Policy uncertainty

26%

0%

54%

-6%

10. Climate/environmental change

23%

0%

60%

-4%

Less than half of leaders feel their leadership team is prepared to address economic uncertainty and the availability of key talent and skills, despite them being top perceived threats. Notably, only 33% of leaders feel their leadership team is prepared to address geopolitical uncertainty. Leadership preparedness to face technological change is higher, at 55%.

Leaders tend to feel that their leadership team is more prepared to address major health threats, increased regulation, and cyber threats, with 71%, 65%, and 68% saying they feel their leadership team is prepared to face these respective concerns.
% of leaders selecting threats as top 5 issue vs ​% of leaders reporting leadership team is prepared or very prepared

EXTERNAL THREATS

TOP EXTERNAL THREATS

L6M*

% PREPARED OR VERY PREPARED

L6M*

11.

Hybrid work implementation

22%

-2%

49%

-5%

12.

Major health threats

11%

-4%

71%

-1%

13.

Exchange rate volatility

10%

-2%

50%

-6%

14.

Trade conflicts

9%

+1%

45%

-6%

15.

Investor activism

9%

0%

53%

0%

16.

Heightened scrutiny of diversity/inclusion

8%

-2%

52%

0%

17.

Taxation

8%

+1%

51%

0%

18.

Rising wealth inequality

5%

-1%

40%

-6%

19.

Protectionism

5%

-1%

34%

+3%

20.

Populism

4%

0%

19%

-4%

Less than half of leaders feel their leadership team is prepared to address economic uncertainty and the availability of key talent and skills, despite them being top perceived threats. Notably, only 33% of leaders feel their leadership team is prepared to address geopolitical uncertainty. Leadership preparedness to face technological change is higher, at 55%.

Leaders tend to feel that their leadership team is more prepared to address major health threats, increased regulation, and cyber threats, with 71%, 65%, and 68% saying they feel their leadership team is prepared to face these respective concerns.

Select External Threat


Uncertain economic growth   Availability of key talent   Tech change   Increased regulation      Changes in consumer behavior   Geopolitical uncertainty   Cyber threats  Policy uncertainty   Commodity price volatility   Climate/environmental change   Hybrid work implementation     Major health threats   Exchange rate volatility  Trade conflicts  Investor activism     Heightened scrutiny of diversity and inclusion   Taxation   Rising wealth inequality  Protectionism   Populism  
While uncertain economic growth has remained a top threat, preparedness to address this threat has decreased by 10 percentage points in the last six months. Preparedness to address the availability of key talent and skills has stayed relatively unchanged since H1 2022, with 47% of leaders stating that they feel their leadership team is prepared to face this threat.

Leadership preparedness to tackle technological change has decreased by 8 percentage points since H2 2022, while preparedness to address increased regulation and cyber threats has been relatively stable in the last 18 months.

What matters most to leaders in a world in flux?

Amid volatility on all fronts, which external business issues are leaders most concerned about? And where are they investing their time and energy to find a way forward?


To get a pulse on the business landscape, we surveyed more than 2,500 global board directors, CEOs, C-suite leaders, and next-generation leaders across various industries.


We set out to identify the top external threats leaders are facing today—and how prepared they are to manage them.


01. Economic uncertainty and the availability of key talent remain top threats

This has been a consistent headline since the start of 2022—and these threats show no signs of receding. Rising inflation and interest rates, disrupted supply chains, price fluctuations, and cost of living pressures are complex issues with no quick fixes. Likewise, despite labor markets showing greater stability, talent engagement and retention remain stubborn issues for organizations globally, with 62% of leaders reporting that they would be likely or very likely to consider a career move beyond their current employer.


 

02. Preparedness to face economic uncertainty drops significantly

Leaders’ readiness to face economic uncertainty—a top perceived threat—has dropped by 10 percentage points over the last six months. This is the largest single drop in leadership preparedness of any of the external threats we’ve measured in the last two years. Now, only 48% of leaders feel their leadership team is prepared to face this threat. It’s important that leaders find ways to build resilience against this threat in the long term.


 

03. Tech change and cyber threats climb the leadership agenda

The arrival of generative AI tools, such as ChatGPT, is creating huge opportunities—as well as a fair amount of anxiety—and many leaders are yet to understand how to put the right guardrails in place to protect their organizations. In our latest research, 51% of leaders named technological change as a top-five threat to organizational health. The last time it reached this level was in H1 2021, when leaders were learning how to navigate remote working. Leadership preparedness to face this threat has dropped by over 8 percentage points.


Business leaders are also growing increasingly concerned about cyber threats. In the last six months, there has been a 6 percentage point rise in the number of leaders who view it as a top-five threat. To combat this, leaders can protect their organization by ensuring that they have responsible, expert-informed, and AI-enabled frameworks in place, focusing on safeguarding and governance.


 

04. Geopolitical concern continues to be viewed as a threat by business leaders

Geopolitical concerns have been a consistently high threat for business leaders since the Russia-Ukraine war began in H1 2022. Today, 37% of leaders have named it as a top-five threat—a figure that will likely increase in our next survey in light of recent events in the Middle East.


Geopolitical threats are becoming incredibly difficult for business leaders to predict and prepare for, with only 33% of leaders feeling that their leadership team is prepared to address this concern.


 

Regional and industry data


Did you know that hybrid work implementation is more of a concern for leaders in the US and Canada? Or that the availability of key talent and skills is seen as more of a threat in France than in any other country we surveyed? Find out what the top threats are in your country and industry—and leaders' preparedness to face them.


Download to see how your country compares        Download to see how your industry compares

 

How our leadership advisors can help


Our leadership advisors are experts in building teams of transformational leaders who can help you look toward the future with confidence.


We’re well-versed in guiding organizations through change. If your leaders are concerned about weathering economic uncertainty, navigating technological change, or looking for guidance on how to engage and retain your leadership team, our advisors are here to help.


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About Global Leadership Monitor


The Global Leadership Monitor is a global survey of boards, CEOs, CxOs, and next-generation leaders that tracks key threats to organizational health and leadership preparedness to face them.


Methodology

 

About the Authors and the CLI team


Ela Buczynska, Tom Handcock, and  Gabrielle Lieberman of RRA’s Center for Leadership Insight conducted the research and authored this report.


The authors wish to thank the 2,500+ leaders from RRA’s global network who completed the 2023 Global Leadership Monitor Fall Pulse. Their responses to the survey have contributed greatly to our understanding of leadership in 2023 and beyond.


Learn more about the team

 

 

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