This sentiment is reflected in PwC’s 28th Annual Global CEO Survey, which gathered insights from 4,701 chief executives, including 1,520 from the Asia Pacific region and 31 from Malaysia.
Over the past year, many CEOs have actively pursued new sources of value. Almost half of these leaders have developed innovative products or services, and a third have also ventured into new sectors and industries. Artificial Intelligence (AI) continues to generate excitement, while sustainability is not only becoming a strategic priority, but also a driver of financial success.
Despite these advancements, some companies continue to lag in reinvention, hindered by leadership mindsets and processes that cause stagnation. These organisations face a critical decision: either accelerate their efforts to transform their businesses or cling to the hope that minor optimisations will suffice. As AI and the transition to a low-carbon economy redefine economic value, relying on outdated operating and business models may prove inadequate.
Optimism about economic growth has continued to increase.
Amid geopolitical and trade tensions, CEOs in Malaysia expressed optimism about the global economic outlook. Nearly 68% anticipated global growth to improve in the next 12 months, a significant increase from just 23% in last year’s survey.
Optimism about the local economy has also surged, with 87% of CEOs expecting the local economy to improve this year, compared to just 41% last year. This positive sentiment aligns with projections that Malaysia will maintain its growth momentum in 2025, fuelled by robust investment activities, sustained household spending, and an increase in exports.
Nearly half (45%) of CEOs in Malaysia remain confident about their companies’ revenue growth over the next 12 months. This optimism is reflected in their hiring intentions, with around 35% expecting to increase headcount in the coming year, compared to only 26% who anticipate a reduction.
Source: PwC’s 28th Annual Global CEO Survey – Malaysia findings
Source: PwC’s 28th Annual Global CEO Survey – Malaysia findings
However, plans for growth and increased hiring may be tempered by concerns over the availability of skilled workers, a challenge that CEOs in Malaysia identify as their top threat. This concern outweighs issues such as macroeconomic volatility and inflation, which are more pressing for their counterparts globally and across the Asia Pacific region.
Moreover, CEOs are increasingly concerned about cyber risks and technological disruptions. The rise of ransomware and cyber activities linked to geopolitical conflicts has led to operational disruptions for many companies in Malaysia. This concern was also reflected in a recent survey on corporate directors in Malaysia, where cyber risk was ranked as the primary threat.
Q: How exposed do you believe your company will be to the following key threats in the next 12 months? (Showing only ‘highly exposed’ / ‘extremely exposed’)
Source: PwC’s 28th Annual Global CEO Survey – Malaysia findings
CEOs in Malaysia are taking steps to reinvent their businesses, but the key question remains: Are these moves bold enough to ensure success?
Many business leaders recognise the need to reinvent their business models. More than half (55%) of CEOs in Malaysia say they do not believe their organisations will be viable in a decade if they continue on their current path, an increase from 43% last year.
Source: PwC’s 28th Annual Global CEO Survey – Malaysia findings
On a positive note, a majority of CEOs have reported taking at least one significant step to transform how their companies create, deliver and capture value. The most prevalent reinvention actions involve product or service innovation and forming partnerships to establish new ecosystems. However, fewer companies have ventured into more challenging areas, such as pioneering new routes to market, implementing new pricing model or targeting a new customer base.
Over the past five years, 42% of CEOs reported that their companies have ventured into at least one new sector, reflecting a broadening trend driven by more than three decades of digitisation, which have begun to dissolve previously impenetrable boundaries between industries. Our strong belief is that the interplay between climate change, artificial intelligence and other megatrends will hasten this reconfiguration process, fostering new growth opportunities that span across sectors.
Q: To what extend your company taken the following actions in the last 5 years? ? (Showing only to a large / very large extent)
Source: PwC’s 28th Annual Global CEO Survey – Malaysia findings
Two years since AI captured the attention of executives, its global adoption has surged. In Malaysia, nearly half of surveyed CEOs have prioritised integrating AI, including generative AI (GenAI), into their business workflows and technology platforms over the next three years. Conversely, fewer CEOs are focusing on using AI to develop new products or reshape core business strategies, which is a pragmatic approach for most companies.
Interestingly, only 23% of CEOs have plans to integrate AI into their workforce and skills strategy. This could be a significant oversight, as realising the potential of AI relies heavily on employees being adept at using AI tools and understanding their limitations.
Despite the enthusiasm surrounding AI, only 34% of CEOs express trust in incorporating AI within key processes in their companies. This scepticism is understandable - AI is still in its nascent stages, and executives are balancing their optimism with a cautious approach.
Q: To what extend you think AI will be systematically integrated into your company? (Showing only to a large / very large extent)
Source: PwC’s 28th Annual Global CEO Survey – Malaysia findings
As CEOs establish their priorities, many are recognising climate change not only as a risk but also as a significant opportunity for industry disruption. In Malaysia, 61% of CEOs have reported making climate-friendly investments, which have resulted in some positive impact. While 34% of Asia Pacific CEOs acknowledge that these investments have increased costs, nearly 40% have experienced a boost in revenue.
Investors are also becoming increasingly convinced by these outcomes and other supporting evidence. In the recent PwC Global Investor Survey 2024, almost 70% agreed that companies should make expenditures to address sustainability/ESG issues relevant to the business, even if it reduces near-term profitability.
Furthermore, 77% of surveyed CEOs in Malaysia said their personal incentive compensation was linked to sustainability metrics, higher than the global average of 56%. Our global analysis reveals that as the percentage of CEO compensation linked to sustainability increases, so does the likelihood of generating revenue from climate-friendly investments.
CEOs in Malaysia have a unique opportunity to drive transformation and unlock new avenues for value creation. Consider implementing these four actions to help prioritise reinvention and position their organisations for sustainable growth.
About the survey
PwC invited CEOs to participate in our 28th Annual Global CEO Survey from 1 October to 8 November 2024. We collected 4,701 CEOs worldwide, including 1,520 responses from Asia Pacific and 31 responses from Malaysia.
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.
Not all figures in bar and stacked bar charts will add up to 100% as a result of rounding percentages and the decision in certain cases to exclude the display of ‘neither/nor’, ‘other’, ‘none of the above’, ‘don’t know’ and ‘prefer not to say’ responses.
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