Executive takes on Election 2024: Sectors: PwC

Executive summary

Executives say state governments and federal regulators have a bigger impact on their business than the presidential election, particularly in more heavily regulated industries such as healthcare and financial services. Regular communication, good relationships and scenario planning can help the C-suite be more ready for potential impacts to their operations and strategy. Here’s where each industry is keeping watch.

Consumer markets

Consumer markets brace for regulatory and trade changes

As the US presidential election nears, consumer markets (CM) companies are evaluating its potential impact on their operations. According to our October 2024 Pulse Survey, 74% of CM leaders agree or strongly agree that the outcome of the election could significantly change how they do business. Regardless of the results, CM leaders strongly agree that post-election trade and tax policies could harm US competitiveness (33% versus 27% of all respondents).

One policy area of concern for CM executives is antitrust and competition. Under a Harris presidency, 36% of CM leaders rank this as a top-3 policy risk for their business (versus 33% of all respondents). This underscores the industry’s reliance on competitive pricing strategies and market tactics. Businesses may need to strengthen their compliance frameworks and prepare for more rigid controls on price-setting flexibility.

CM leaders also worry about US trade policy, with 36% ranking it as a top-3 policy risk under a Trump administration (versus 31% of all respondents). Changes to trade policies could mean companies have to source more materials locally, diversify suppliers and adapt to new cost dynamics.

CM leaders should keep a close eye on regulatory and trade policy shifts and adjust their business strategies accordingly. This includes preparing for possible supply chain disruptions and higher import costs, while also anticipating environmental regulatory changes no matter who takes office. Proactive scenario planning can help keep operations agile and responsive to changes.

Energy and utilities

As they watch regulatory and tax landscape, EUR leaders plan for tech spending

Most of the energy, utilities and resources (EUR) executives surveyed say the election outcome will affect their approach to regulatory compliance (79% either somewhat or to a great extent), according to PwC’s October 2024 Pulse Survey.

Scenario planning around evolving energy policy can help leaders be ready. From permitting for pipelines, drilling and infrastructure to the nuances of rate-setting, navigating the regulatory process and consistently executing can be a competitive differentiator for energy and utilities companies. Executives should proactively engage with lawmakers at all levels. While much authority sits with federal agencies and regulatory appointments may be delayed in times of divided government, much of day-to-day regulation happens at the more local levels.

Tax and tax credits are also top of mind for EUR leaders. They’re more likely to say the election will affect their use of tax credits to fund investments (79% either somewhat or to a great extent versus 72% across all industries). Beyond credits for renewable energy, we’ve seen more oil and gas companies claiming R&D credits, whether for carbon capture, electrifying field operations or finding better, more efficient ways to drill. (Carbon capture can also be eligible for an IRA renewable energy credit.) Executives should actively advocate in Washington and locally, pushing for continued funding while emphasizing the environmental and economic advantages of US-based energy sources.

The corporate AMT is also impacting many EUR companies, and while that tax is likely to stay, multinationals should be watching Pillar 2 effects for signals on how the US may respond in the years ahead.

Energy and utility executives face growing pressure to innovate by leveraging technology to provide cheaper, more reliable power sources. Transitioning to renewable energy sources such as wind, solar and hydropower requires substantial investment in data analytics, smart grid technology and energy storage solutions. Advancements in battery technology are crucial to help confirm power is available regardless of the weather or time of day. AI-driven analytics can help enhance operational efficiency and reduce outages. Under both a Harris (52%) or Trump (57%) administration, EUR leaders say they plan to increase investments in technology.

Financial services

Election may change financial services dealmaking sentiment

Many financial services (FS) dealmakers are taking a cautious approach to transactions given economic, regulatory or monetary policy uncertainties. But the election may change that. In our October 2024 Pulse Survey, 84% of FS executives say the election outcome will affect, either somewhat or to a great extent, their company’s business decisions about acquisitions or divestitures (compared to 71% of all executives).

Looking specifically at the presidential candidates, a Harris administration may have a larger impact on FS dealmaking. When we ask FS executives how a Harris win would change their acquisitions and divestitures investments, 45% say they would increase activity from current levels, while 11% see a reduction. In the case of a Trump victory, 37% say they would increase deal-related investment, while 15% expect to spend less. That’s assuming other policy changes don’t emerge and change a transaction’s value. FS executives tell us US economic policy is the top policy risk they see in a Harris administration, followed by corporate tax rates. Under Trump, economic and climate policies pose the biggest risks.

More than other industries, financial services executives in our survey agree or strongly agree that there will be divided government after the election (82% versus 76% of all executives). Such an outcome may limit the probability of either a Harris or Trump administration implementing policies FS executives say will hurt US competitiveness, including a corporate tax rate increase to 28% or a universal 10% tariff on imports.

Double down on due diligence. Focus on understanding how potential changes to interest rates, tax and trade policies could affect the underlying economics of target companies.

Health industries

Health industries leaders weigh outcome of election

As the 2024 elections approach, health industries (HI) executives are watching regulatory, trade and tax policy signals. Regardless of who becomes president, HI executives hold strong views that the outcome of the election will affect their company’s business decisions somewhat or to a great extent, particularly their approach to regulatory compliance (92% versus 76% overall). HI leaders say the same about their financial forecasts and budget decisions (86% versus 75% overall).

HI leaders are more likely to say that, regardless of who is president, post-election trade and tax policies will hurt US competitiveness (86% versus 71% overall). They’re also more likely to say that the business environment will be more litigious (81% versus 75% overall) no matter who wins, and that the US regulatory environment stifles their company's ability to innovate (84% versus 75% overall). Those sentiments are likely tied to multiple legislative issues that affect healthcare companies more than others such as the BIOSECURE ACT, the growth of Medicare Advantage and the effects of potential new policies that would impact reimbursement strategy and revenue cycle management. This is happening in a business environment where medical costs are projected to rise to their highest level in 13 years and the pharma sector continues to face its own hurdles.

HI executives should build resilience into existing business models or explore new ones, identifying new profit pools more resilient to potential political and policy headwinds and exploring new business relationships to find paths to growth. They should also prepare for evolving regulatory and compliance requirements, including shoring up data protection and cybersecurity risk management and adopting Responsible AI practices.

Industrial products

Industrial products companies eye election outcome and business decisions

Industrial products (IP) companies are keeping a close eye on the November elections, particularly when it comes to trade policy, according to PwC’s October 2024 Pulse Survey. Three quarters of IP leaders say the outcome of the election will either somewhat or significantly change their company’s trade decisions. This is likely due to IP companies being heavily reliant on raw materials and components from overseas. Trade policy — including tariffs, trade agreements and sanctions — often affect the cost and availability of these materials.

Sixty-eight percent of IP leaders say that the outcome of the election will affect their decisions around financial forecasts either somewhat or to a great extent — lower than the overall average of 75%. IP companies tend to operate on longer investment cycles than other industries, with projects and capital outlays planned over many years. As a result, a single election cycle may not drastically affect their long-term strategies. Instead, their focus may be more centered on managing broader business challenges such as reinventing their business models and decarbonization.

More than six in 10 (62%) IP respondents say the outcome of the election will affect their company's business decisions around outsourcing either somewhat or to a great extent (compared to 68% for all industries). Executives in IP may feel relatively more insulated from election-related shifts in outsourcing policy compared to leaders in other sectors because both major political parties have a track record of supporting domestic manufacturing and supply chain resilience.

Essentially, IP company executives should monitor changing regulations that may reshape the industry. By focusing on resilience and adaptability, IP leaders can better position themselves to thrive, regardless of the election results.

Technology, media and telecom

Tech, media and telecom leaders brace for regulatory impacts

Two concerns loom large for technology, media and telecommunications (TMT) executives this election cycle: regulatory compliance and cybersecurity. The sector is preparing for potential policy shifts that could have repercussions for digital platforms and content providers. According to our October 2024 Pulse Survey, 80% of TMT leaders say the election outcome could significantly change how they do business.

Most TMT executives surveyed identify cyber attacks as a moderate or serious business risk, higher than other industries. This reflects the sector's reliance on digital infrastructure and data, making it more vulnerable to cyber threats. About seven in 10 also cite both the US and global regulatory environments as a risk. Stricter statutes may dampen sector progress, and 76% say the US regulatory environment stifles their company’s ability to innovate. With increasing scrutiny of data privacy, antitrust and content regulations, 79% of TMT executives say the election outcome will affect both how their company engages with policymakers and how they approach regulatory compliance somewhat or to a great extent.

Three quarters of sector leaders expect to see a more litigious business environment no matter who wins the election. TMT leaders are paying attention to recent developments, such as the Chevron ruling. Legal and reputational risks are developing around the expansion of artificial intelligence (AI) in addition to overall technological disruption. The buzz around AI continues as it fundamentally changes business. As this powerful technology continues to reshape business models and operations, companies across all sectors are redefining how they can create value and engage with customers. Moving forward, they should lean into AI risk assessment and compliance. Regulatory frameworks like the recent executive order on AI from the US, as well as international standards such as the EU AI Act, are pushing the sector to establish responsible adoption practices, manage risks and bake transparency and global compliance into their business strategies.

Despite 67% of TMT executives saying there will be a recession in the next six months, the sector continues to focus on growth through collaborative business models and data-driven M&A strategies, especially for media and telecoms. But this may change as the election unfolds, with 84% saying the outcome will affect their company's strategic business partnerships somewhat or to a great extent, more than any other industry PwC surveyed. Three-quarters (75%) say the same about their acquisition and divestiture decisions.

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About the survey

Between September 12 and September 19, 2024, PwC surveyed 709 US executives, including CFOs and finance leaders (14%), tax leaders (13%), risk management leaders, including CROs, CAEs and CISOs (10%), CIOs, CTOs and technology leaders (11%), CHROs and human capital leaders (9%), COOs and operations leaders (11%), corporate board directors (12%), CMOs and marketing leaders (11%) and CEOs (9%). Respondents were from public and private companies in six sectors: industrial products (29%), consumer markets (29%), financial services (13%), technology, media and telecom (13%), health industries (5%), energy and utilities (8%), and other (2%). The Pulse Survey is conducted on a periodic basis to track the changing sentiment and priorities of business executives.