The CEO Imperative Series
In an age of volatility, most global CEOs (57%) expect today’s geopolitical and economic uncertainty to last well beyond a year. This stark outlook marks a pivotal moment to rethink resilience, agility, and long-term strategy.
In response, bold CEOs are not retreating, they are leaning in. Over half (52%) are investing to accelerate portfolio transformation.
As the global economy fractures, many leaders are rewiring operating models — building local and regional capabilities closer to customers, communities, and talent. This enables faster adaptation to diverging government rules and shifting markets.
Our latest EY-Parthenon CEO Outlook Survey — conducted in August 2025 — highlights a standout group of leaders: 15% of respondents who are more confident than their peers. They’ve already completed localization plans ahead of schedule, increased transformation investment, and are generating the capital to sustain their forward-looking strategies.
This begs the question: Does confidence come from feeling more positive about one’s own outlook? Or is that positivity the result of taking proactive and decisive action, even in the midst of unrelenting uncertainty and volatility?
This is the new leadership frontier. Embracing volatility as a strategic advantage. The CEOs confidently shaping the future are not waiting for stability to return. They are rewriting the rules of growth, resilience, and transformation in real time, with eyes firmly fixed on tomorrow’s opportunities.
In this edition:
In the face of ongoing geopolitical and economic challenges, business leaders are not only adapting but also seizing opportunities for growth. A significant 47% of Singapore CEOs in the latest EY-Parthenon CEO Outlook Survey expect such uncertainty to last beyond the current year, yet they are increasingly optimistic about their ability to navigate the complexities ahead. This reflects the fact that many CEOs view challenges posed by market and policy volatility as an opportunity to transform their businesses.
The rationale for dealmaking remains strong, as 48% of Singapore respondents plan to pursue M&As this year. There is a continued focus on joint ventures and strategic alliances, with 70% of Singapore CEOs looking to engage in such collaborations. Additionally, Singapore CEOs identify their local market as the top destination for planned M&A activity. The favorable CEO sentiment toward inorganic growth is driven by greater financial confidence, easing borrowing costs and strong availability of private capital, with a focus on growth, localization and building capabilities to future-proof the business.
Times of uncertainty also present companies with great opportunities. With a clear strategy, disciplined execution and strong leadership, M&A remains a powerful lever for long-term value creation by helping companies unlock synergies, preserve their competitive edge and drive growth well beyond short-term financial returns.
Reports of integration hurdles, cultural misalignment and overestimated synergies often lead to speculation around how much shareholder value is delivered after the deal. However, many CEOs in Singapore say their recent acquisitions met or exceeded value expectations, with only a small percentage reporting value destruction.
Localization and regionalization are gaining significant traction. Eighty-one percent of Singapore CEOs regard localization as a long-term strategic shift, with 65% echoing this sentiment for regionalization. This is largely driven by the need to adapt to changing market dynamics and customer expectations for companies to respond more swiftly to local demands.
In addition, 33% of Singapore respondents have completed localization plans, with a further 30% currently in the process of implementation.
Singapore CEOs are also embracing change and transformation, with 47% planning to increase investments to accelerate portfolio transformation in the next 12 months.
Chapter 1
Transformation becomes a permanent strategy as CEOs reshape portfolios and balance short-and long-term performance goals.
Despite the backdrop of trade tensions, tariff disputes, and broader geopolitical uncertainty, many CEOs are expressing greater confidence in the global, regional and sector outlook. The EY-Parthenon CEO Confidence Index currently stands at 83, up from 76.5 in May 2025. This increased optimism primarily stems from a combination of stronger confidence in their own earnings and profitability and the adaptability that businesses have shown in navigating global challenges.
Another factor likely bolstering CEO confidence is the resilience of financial markets and the sustained access to capital. This environment enables continued investment in innovation, talent development and strategic growth. Equity markets, boosted by artificial intelligence (AI) and technology stocks, are reaching record levels, and although interest rates remain elevated compared with the pre COVID-19-pandemic era, market liquidity is still robust, with no indications of tightening credit conditions. The International Monetary Fund (IMF) revised its global forecasts upward in its most recent outlook.¹ This does not mean the economy will be free of challenges — for instance, 79% of CEOs see inflation as a potential significant operational headwind over the next year. Even so, the most recent earnings season recorded a sharp drop in recession mentions.
This growing confidence shows that some CEOs are gradually adapting to pervasive policy uncertainty and volatility. Uncertainty is not new; trade disputes and political shifts have long been part of the global landscape. But the pace of the changes and the resulting uncertainty are higher today.
More than half (57%) expect the geopolitical and economic uncertainty to last longer than a year, with nearly a quarter (24%) forecasting longer than three years.
So, CEOs are not being sanguine about the external geopolitical, macroeconomic and trade risks they face. It may be more of a shift of focus. Compared with the May 2025 survey, CEOs see the major risks to growth, such as technology disruptions and AI integration or talent management and innovation, as areas more under their control.
The global EY organization’s Megatrends article highlights this new environment — what we call a NAVI world. It is a business landscape characterized by nonlinear, accelerated, volatile and interconnected forces. This means that change does not follow predictable patterns but unfolds at unprecedented speed, arrives in unpredictable surges and bridges systems in ways that demand entirely new ways of operating, thinking and leading.
Technology, labor availability, and innovation are deeply interconnected as companies seek to accelerate growth. Advances in technology create new opportunities for efficiency and expansion, but they require skilled labor to harness their full potential. At the same time, a diverse and adaptable workforce brings the creativity needed to drive innovation, while innovation itself shapes how technology is applied to solve business challenges. When these three elements align, organizations can unlock new business models, scale faster and remain competitive. Together, they form a cycle in which progress in one area fuels momentum in the others.
The first step in any transformation is deciding exactly what assets to transform, taking bold decisions on what to keep and what to let go. The biggest sign in the survey to support this proactive mindset from CEOs are their intentions on transforming their portfolios.
More than half of CEOs (52%) plan to increase investment to accelerate portfolio transformation, reflecting a recognition that adapting to shifting markets and customer expectations is no longer optional but essential for growth. Transformation today is about more than cutting costs or streamlining operations. It involves reshaping business models, entering new markets and leveraging emerging technologies to create sustainable competitive advantages. By reallocating resources and investing in new opportunities, they aim to capture growth ahead of competitors and build future-proof organizations.
At the same time, 39% of CEOs plan to maintain investment at levels consistent with recent years. This indicates that transformation is not a short-term project but an ongoing commitment, both at a functional level and enterprise wide. Maintaining steady investment allows companies to sustain momentum while continuing to experiment and innovate at a pace aligned with their strategic priorities.
Together, these figures show that CEOs overwhelmingly view transformation as a permanent feature of business strategy as they look to unlock value. Whether accelerating or maintaining their efforts, leaders understand that having the confidence to reimagine their enterprise and the capabilities to realize those changes is central to their long-term success.
It is also a key pillar of their strategy for funding their long-term transformational goals. A plurality of CEOs (41%) are transforming their portfolios to improve their financial performance. This will then support their preferred way of financing the ongoing transformation.
The second-most-selected option was focusing on long-term value creation rather than near-term performance. CEOs must balance immediate financial performance with long-term value creation. While navigating short-term uncertainties is critical for resilience, focusing only on near-term results may risk undermining sustainable growth. Long-term strategies build trust, strengthen stakeholder relationships and ensure enduring competitiveness, enabling companies to thrive well beyond immediate market pressures and disruptions.
Again, CEOs are looking to stay in control of their own destiny as much as possible given the volatile external conditions. The majority (59%) are looking to fund transformation initiatives through improved financial performance and increased margins. A further 21% will look to tap existing shareholders, and 16% are considering debt financing. Only 4% will fund transformation through the divestiture of assets.
Chapter 2
Localization rises as a long-term strategy, balancing global scale with regional agility to meet regulatory, economic, and consumer demands.
Globalization as we knew it is cracking under the weight of trade wars, tariffs and geopolitical shocks, and CEOs are no longer waiting for it to stabilize. The fragility of formerly vaunted models of concentrated globally dependent supply chains has been exposed. The response is clear: For many companies, this means localizing or regionalizing aspects of production and sourcing — not as a retreat but as a pragmatic response to changing pressures.
The goal is to rewire supply chains for speed, resilience and the ability to serve customers more efficiently, with lower costs and fewer policy restraints. At the same time, it’s not a one-size-fits-all solution: Some businesses will find full localization impractical, cost-prohibitive or unnecessary, choosing instead to adopt a hybrid approach that balances global scale with regional agility.
Nevertheless, nearly 75% of CEOs are either in the process of localizing or have localized some part of their production within the country of sale. Just over half are in the process or have reorganized supply chains to serve a particular regional bloc.
Another reason many CEOs are pursuing this strategy is the rising importance of resilience, trust and transparency in the business environment. Localizing operations not only secures supply chains but can also strengthen relationships with governments, regulators, and local communities. In many markets, there is growing pressure to support domestic economies, create jobs, and align with regional sustainability goals. By investing locally, companies can build goodwill, enhance their reputation and position themselves as contributors to local development.
And for the majority (72%) this is not a temporary shift reflecting recent headlines about tariffs or trade. While the triggers have been immediate, the strategy is evolving from a reactionary to a strategic long-term response — one that has arguably been on the table since the COVID-19 pandemic’s systemic shocks. Barring another shock that pushes in the opposite direction, this will likely continue to play out as a model for global companies into the future.
How EY-Parthenon can Help
The Geostrategic Business Group can help translate geopolitical insights into business strategy to help manage political risk. Find out how.
Read moreTechnology and data is the area in which CEOs are pushing furthest on localization and regionalization. There are several reasons for this. Automation, AI and digital platforms enable companies to replicate efficiencies on a smaller, more regional scale, making it feasible to shift away from centralized global hubs without losing productivity. Moreover, proximity to consumers means businesses can better tailor products and services to cultural preferences and market conditions, providing a stronger competitive edge. And given many governments are enacting policies to bolster their economies’ digital sovereignty, there is a regulatory compliance aspect to these decisions as well.
Ultimately, localization and regionalization reflect a strategic shift from viewing globalization as a single integrated system to seeing it as a network of connected but distinct markets. CEOs increasingly recognize that shifting the focus to local markets — while keeping a global perspective — is a key to ensuring both stability and growth.
Our analysis of CEO localization plans shows that the US is clearly an area of primary focus — it has long been an attractive market and figured highly on the minds of international CEOs. It is still the world’s largest economy and consumer market. For most countries the first choice is unsurprisingly their home market. But in most cases the US is a clear second for enhanced focus.
Many CEOs seem to be beginning to view localization of their US operations as a strategic imperative, drawing lessons from the widely adopted “in China, for China” approach. That model emerged as companies recognized the necessity of tailoring supply chains, product design, and distribution specifically to the Chinese market, reducing dependence on imports and insulating themselves from geopolitical risks. A similar logic now appears to be taking hold regarding the US market, where rising geopolitical, tariff and trade tensions, and increasing scrutiny on resilience, are pushing leaders to re-evaluate where and how they operate.
For many firms, building more robust US-based operations offers not only a hedge against external shocks, but it also resonates with growing political and consumer expectations around strengthening domestic industries and creating jobs.
CEOs are adapting to the new US administration — many are placing US investment and job creation at the center of discussions on trade, regulatory, and other policy matters. This focus on jobs and investment has become recurring feature of the business-policy dynamic in recent years.
Just as companies in China localized to gain proximity to customers and regulators, US-focused localization is increasingly seen as a way to balance efficiency with security. In effect, the emerging “in US, for US” strategy mirrors the same pragmatic calculus that shaped corporate strategies in China over the past decade. Of course, in many cases these are just plans or announcements at this time. In the coming months and years, it will become clearer just how robust the “in US, for US” strategy may become.
These strategic moves to localize or regionalize operations will not happen without increased costs and operational challenges in the short-term. And not all operations or functions have been moved for a majority of respondents. As they think through the implications of this approach, CEOs should ask themselves a series of questions to understand the costs and benefits that may accrue.
Chapter 3
Strategic alliances and joint ventures gain traction as CEOs seek agile growth paths amid regulatory scrutiny and rising innovation costs.
One corner of the business world thriving in 2025 is M&A. While it hasn’t captured the headlines — overshadowed by tariff battles, trade disputes, and geopolitical shifts — deal-making has quietly accelerated at pace. CEOs have been reshaping their portfolios at a speed well above 2024’s, signaling renewed certainty, confidence and a sharper focus on long-term transformation through transactions.
Another notable aspect of the current deal market is the increasing average value of deals.
How EY-Parthenon can Help
Learn how EY-Parthenon M&A Advisory Services teams can help enable strategic growth through integrated M&As, joint ventures and alliances.
Read moreOur latest CEO survey indicates that this healthy level of M&A looks set to continue through the next few months. While the number of CEOs indicating they will pursue a divestiture in the next 12 months has ticked down slightly, this is an area of M&A that may see some big major announcements in 2025. A notable number of companies have announced deals positioned as a simplifying focus so that the stand-alone companies can be more competitive in their direct markets. There may be more of these, especially in the consumer and industrials sectors.
Technology, financial services, and life sciences have been active sectors through 2025. The US has been the most targeted nation, and the return of M&A in China has boosted global number. The UK, Japan and Canada have also been strongly targeted nations.
This focus on deals that will move the strategic dial is reflected in CEOs deal strategies over the next 12 months. Their deal decisions are driven by a strong emphasis on growth, in line with their transformation strategies.
CEOs are increasingly gravitating toward joint ventures and strategic alliances to achieve growth while avoiding the financial and operational strain that often comes with traditional mergers and acquisitions. In a climate where regulators are watching deals more closely, many leaders see partnerships as a way to move quickly, test collaboration, and access new markets or technologies without fully committing to ownership. Unlike acquisitions, alliances allow companies to share risks, pool expertise, and keep their cultures intact, which often translates into greater agility and less disruption to employees and customers.
Industries that rely heavily on innovation and scale are among the most likely to pursue these models. In technology and semiconductors, the rising cost of research and the global race for advanced computing power are pushing firms to collaborate. By forming alliances, companies can accelerate the development of new chips, share access to scarce manufacturing capacity, and align on emerging standards, all without the delays and uncertainties of merger reviews. In clean energy sectors such as hydrogen, carbon capture, and battery storage are seeing a surge in joint ventures because the capital intensity is immense and many projects depend on public subsidies or shared infrastructure. Partnerships in this space allow firms to split upfront costs and broaden their access to government incentives while also diversifying risk.
The life sciences sector is another area where strategic alliances are flourishing. Drug development is long, expensive, and uncertain, making co-development agreements attractive. Pharmaceutical companies and biotech firms can share research pipelines and accelerate clinical trials while limiting their financial exposure if projects fail. The automotive industry is also embracing alliances, particularly around electric vehicles and software platforms, as carmakers seek to spread the cost of new technologies and secure supply chains. By forming partnerships rather than pursuing outright acquisitions, CEOs can pursue innovation, resilience, and growth while keeping their options open.
The survey highlights a new era of leadership where CEOs see volatility as an advantage rather than a setback. Instead of waiting for stability, they are building agile, innovative, and connected organizations designed to thrive amid disruption. Growth strategies now emphasize alliances, joint ventures, and selective investments over large acquisitions, signaling a pragmatic shift. Bold leaders distinguish themselves by turning disruption into opportunity and fostering optimism. They are reimagining the future, acting decisively, and reshaping the rules of growth. These leaders are laying the groundwork for resilience, creativity, and long-term competitive strength in an uncertain world.
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