The age of waiting is over: how Australian CEOs are turning uncertainty into a strategic advantage

Australian CEOs are realistic about rising geopolitical risk and economic volatility, but they are no longer paralysed by it. New data from EY-Parthenon shows confidence is being redefined as the ability to invest selectively, act early and use M&A to reshape portfolios for resilience and relevance.

Australian CEOs aren’t paralysed by uncertainty. They’re treating it as a strategic inflection point.

If market confidence were measured solely by the external outlook, Australian CEOs might appear cautious — even pessimistic. Geopolitics remain unstable, macroeconomic volatility persists, and the global operating environment shows few signs of settling. But that is only half the story. The more important signal is the increasing focus on intentional action amidst the chaos.

EY-Parthenon’s May 2026 CEO Outlook Survey, capturing the views of 60 Australian CEOs across major industries, reveals a leadership cohort that is no longer waiting for conditions to improve.

Instead, CEOs are recalibrating what confidence really means, shifting from optimism about the environment to conviction in their own ability to act.

The risks are clear. Geopolitical tension ranks as the single most significant threat facing Australian businesses over the next 12 months, outweighing ongoing concerns such as cybersecurity, supply chain resilience and access to capital. Macroeconomic volatility continues to loom large, with inflation, interest rates and growth uncertainty ever present in the CEO outlook.

What has changed is how tangible these risks have become.

Further EY-Parthenon modelling on a potential disruption to global oil flows through the Strait of Hormuz illustrates why geopolitics is no longer an abstract concern for Australian boardrooms.

Under a severe, prolonged disruption lasting most of 2026, Australia’s GDP could be around $42 billion lower over the year - equivalent to almost $880 million a week in lost activity - as impacts extend beyond fuel prices to delivery timing, supply chain reliability and broader operational constraints.

Even in more contained disruption scenarios, the economic costs are material. Short lived shocks still weigh on growth, investment and consumption, while prolonged disruption significantly amplifies the hit to business activity and employment. Government intervention can reduce volatility, but it cannot fully offset the underlying global supply constraints or the business continuity risks that flow from them.

Against this backdrop, it is notable how decisively CEOs are separating what they cannot control from what they can.

When asked about their own organisations in the CEO Outlook Survey, confidence rebounded sharply across revenue, profitability, competitive position and growth prospects. This divergence matters. It signals that Australian CEOs increasingly view resilience as a capability, something deliberately built through portfolio decisions, capital discipline and strategic optionality, rather than something dictated by the external cycle.

In this environment therefore, dealmaking has become less about growth for growth’s sake and more about insulating portfolios against shocks, giving CEOs a way to actively reshape risk, capability and control rather than absorb uncertainty passively.

This shift is evident in capital allocation and M&A strategies.

Despite persistent uncertainty, nearly two thirds (65%) of Australian CEOs plan to pursue M&A activity over the next 12 months, with appetites increasing over the last year among those already in market. This is not reckless optimism. It is disciplined intent.

Dealmaking today is less about scale and more about control. The survey shows CEOs are prioritising transactions that strengthen technology and AI capability, sharpen strategic focus and improve balance sheet resilience. The significance of capital intensity and organisational complexity has become increasingly prominent. This indicates leaders are using M&A to actively re engineer their portfolios, rather than simply to accelerate growth.

This marks a clear break from the past. The era of expansion at any cost is over. CEOs are explicit that disciplined growth and a clear path to profitability now matter more than rapid market share gains.

The focus on control mindset explains why cost discipline and capital reallocation feature so prominently in strategic responses, without stalling investment in digital, AI or future capability.

Australia’s position in this picture is also telling. Despite global volatility, it ranks as the top destination for CEO capital investment intentions, alongside Singapore and India. Confidence at home remains underpinned by institutional stability, depth of capital markets and relative economic resilience.

The real shift, however, is psychological. Australian CEOs are no longer defining confidence as belief in a benign cycle. They are redefining it as the confidence to make hard decisions early: to invest selectively, divest decisively and deploy M&A as a strategic lever rather than a reactive one.

Uncertainty is no longer a reason to wait. For Australia’s business leaders, it has become a reason to move.