Only a fraction of CEOs worldwide say governments should make combating climate change a top priority, a survey released Tuesday indicates. The survey of more than 1,300 CEOs from 77 countries was released by PricewaterhouseCoopers a day before corporate and governmental leaders are set to meet in Davos, Switzerland, for the annual World Economic Forum.
Among public policy priorities for 2015, nearly two-thirds of CEOs told researchers they want lawmakers to focus primarily on reducing taxes and providing access to skilled workers. Far fewer said they want government to focus on investing in public infrastructure, and just a fraction -- 6 percent -- said they think combating or mitigating the effects of climate change should be a government priority.
That lack of concern about climate change exists even though insurance industry leaders and other experts say if left unaddressed, climate change could cost businesses hundreds of billions of dollars. Only six months ago, a report by billionaire CEO Michael Bloomberg, investor Tom Steyer and former Treasury Secretary Henry Paulson issued a report urging business leaders to make reducing carbon emissions and combating climate change a top priority.
Dennis M. Nally, chairman of PricewaterhouseCoopers International Limited, told reporters in Davos he believes CEOs are focused more on short-term priorities than on longer-term challenges like climate change.
"I think [concern about climate change] is there; I just don't think it is as prominent as some of the shorter-term issues," he told reporters at the World Economic Forum. He also said climate change has created "a lot of debate over regulation," which he said creates "uncertainty, and that influences how [CEOs] are thinking about confidence levels" in the overall economy.
Among concerns heading into 2015, 78 percent of CEOs listed the prospect of overregulation as their biggest fear for the new year. That's a big jump from 2011, when 59 percent said they were worried about overregulation. In the United States, nine in 10 CEOs say they are worried about overregulation -- and political leaders appear to be listening.
After a 2014 election that saw business groups spend millions on campaign contributions, the new Republican Congress has spent its first few days championing deregulation. Specifically, lawmakers passed bills to roll back key financial regulations passed in the wake of the 2008 bank crisis. They also passed legislation public interest groups say is designed to prevent federal agencies from promulgating new regulations as mandated by law. Meanwhile, from Arizona to Massachusetts, new Republican governors have put in place moratoriums on new regulations.
Overall, while the U.S. economy may be experiencing an uneven recovery, the survey showed that corporate leaders now say they're relying more on the U.S. market than China for future growth. That is the first time the U.S. has edged China since the annual survey began asking the question five years ago, though the hopes for the United States to anchor new global business growth may still be just that -- a hope. Indeed, while prospects for increased customer demand in the United States have been boosted by news of steady job growth, American wage growth has been sluggish, and retail sales figures have been inconsistent, suggesting lingering weakness in consumer spending.
Nally said the overarching theme emerging from the survey is that CEOs are focused on dealing with volatility and uncertainty.
“The world is facing significant challenges: economically, politically and socially,” he said. “CEOs overall remain cautious in their near-term outlook for the worldwide economy, as well as for growth prospects for their own companies. While some mature markets like the U.S. appear to be rebounding, others like the eurozone continue to struggle. And while some emerging economies continue to expand rapidly, others are slowing. Finding the right strategic balance to sustain growth in this changing marketplace remains a challenge.”