Agility in action: CEOs innovating and adapting for tomorrow's challenges

There has been an increase in confidence among CEOs in a relatively short period, despite geopolitical tensions and protectionist tendencies. 83% of Irish CEOs are either very or somewhat optimistic regarding the outlook for the global economy over the next 12 months, which is very similar to the global sentiment, where CEO optimism stands at 80%.

In this context, Irish CEOs appear confident that the worst of inflation is behind us, with 78% expressing optimism regarding the cost of inputs and the cost of doing business—up from 60% in September.

In terms of prospects for their own businesses, Irish CEOs show a significant increase in optimism across multiple areas. Notable increases in confidence were recorded for revenue growth, with 80% expressing optimism (up 20%), profitability at 83% (up 16%), and competitive position at 85% (up 28%). These findings are very much in tune with those regarding the economic outlook, aligning closely with the global statistics that reflect broad confidence across both global and Irish CEOs.

While increasing trade protectionism and tensions in Ukraine and the Middle East present challenges, there remains opportunities. With careful navigation and the right investments, businesses can sustain their confidence and optimism in the months ahead.

In light of ongoing reports about shortages of key skills in Ireland, it is noteworthy that 84% of CEOs are optimistic about their ability to attract and retain talent, marking a significant increase of 31% from last September. Additionally, 77% of CEOs express confidence in their capacity to offer competitive compensation, up 14% from the last survey.

From one perspective, this optimism may reflect increased confidence in revenue and business growth, which in turn enhances organisations' ability to offer more attractive compensation packages. Consequently, leaders may feel less concerned about being outbid for key talent by competitors.

It’s clear that pay is just one component of the employee benefits package. Flexible working arrangements, comprehensive wellbeing packages, career progression opportunities, and learning and development initiatives are also crucial. There is no one-size-fits-all solution; the ideal package for one employee may not be particularly appealing to another.

When it comes to actively pursuing transaction initiatives over the next 12 months, 95% of CEOs in Ireland responded affirmatively, closely aligning with the global figure of 96%.

This optimistic outlook is further supported by robust activity in the Irish market in 2024, which recorded a total of 1,392 transactions, as reported in the EY Competitive Edge data, highlighting a strong year for investment. Key sectors driving this activity included Technology, Media & Telecommunications, Health Sciences & Wellness, and Advanced Manufacturing & Mobility.

In terms of transaction types, M&A led the way, followed by Angel/Seed funding and Unattributed Funding Rounds. This backdrop of past activity underscores the strategic shifts in the transaction landscape as CEOs seek to enhance growth and foster innovation. In line with these intentions, 77% of CEOs are either very or somewhat optimistic about their company’s prospects in the coming year, particularly in relation to investments in new areas such as joint ventures or M&A. The key drivers behind this heightened interest in transactions include enhancing customer engagement and retention (58%); reducing costs and unlocking savings (51%); and boosting product and process innovation (48%).

This optimistic outlook among CEOs is likely influenced by several factors. One significant driver is the decline in interest rates, with further cuts anticipated in 2025, which have eased the cost of capital. In fact, 80% of CEOs express optimism about their ability to raise capital, up from 66% just a few months ago. Additionally, there is a growing sentiment that valuations are now more realistic, paving the way for smoother transaction activity. The return of private equity to the market—eager to deploy its dry powder—has also created a favourable environment for consolidation, divestment, and spin-out activities. Consolidation in sectors like healthcare and professional services remains a notable feature of the Irish M&A landscape.

AI Adoption and Workforce Upskilling

Interest in AI and GenAI has reached new heights, particularly following the release of DeepSeek in January 2025. As businesses across all sectors recognise the critical role AI will play in future competitiveness and growth, the need for widespread adoption has never been clearer. However, our survey reveals a sense of pragmatism among leaders regarding the pace and challenges of AI integration. More than three-quarters (77%) of CEOs agree that successfully upskilling their workforce will be the defining factor for industry leadership as AI adoption accelerates.

This highlights an important insight: AI cannot simply be deployed as a plug-and-play solution. To fully harness its potential, human capital must be effectively integrated. The ability of employees to understand, interact with, and leverage AI tools will be essential to achieving productivity gains and driving innovation.

The key question for organisations is how this upskilling will be delivered – and by whom. Given the widespread impact of AI, it is clear that a significant portion of the workforce will require training. Early adopters who invest in both the technology and the necessary upskilling will be better positioned to gain a competitive edge.

Public Trust in AI

Equally crucial to the successful adoption of AI is public trust, and here too, a sense of realism prevails. While AI has already permeated various aspects of daily life – from virtual assistants to customer service chatbots – this familiarity does not necessarily translate into trust, particularly in more sensitive areas.

CEOs are acutely aware of this, with 70% of respondents to our survey agreeing that public trust in AI remains fragile due to a lack of adequate oversight and safeguards. This highlights the need for transparency, accountability, and clear regulatory frameworks.

The European Union has been a leader in regulating AI, with initiatives such as the AI Act setting important precedents for data privacy and AI governance. However, much more needs to be done to strengthen public confidence in the technology. This could involve enhancing the explainability of AI systems, ensuring that the outputs of AI processes are understandable and accessible to users.

Organisations must also take steps to assure the public that their use of AI is responsible and ethical. This doesn’t mean simply publishing a vague policy statement but actively involving humans in the AI decision-making process. By maintaining human oversight and offering customers the ability to query AI-driven outcomes, businesses can build trust and ensure that their use of AI aligns with ethical principles.

The Employment Impact of AI

The accelerated adoption of AI presents a powerful opportunity for both businesses and workers. History shows us that while technological shifts may disrupt some industries, they also pave the way for new sectors, services, and opportunities. The key to success lies in how companies approach AI integration to ensure that workers are supported throughout the transition.

Over half of Irish CEOs (57%) acknowledge the potential for job loss with AI deployment, but their recognition of this challenge presents an opportunity for organisations to shape the future of work. By taking deliberate, thoughtful action now, businesses can guide their workforce through this transition without alienating them. By introducing upskilling programmes, offering pathways for employees to move into new roles, and supporting natural workforce changes, companies can minimise displacement and even create more opportunities for their employees.

Additionally, job redesign and cross-training initiatives will empower workers to evolve alongside technology, helping them develop skills that are in demand. This proactive approach not only benefits employees but also supports businesses in staying competitive in an AI-driven world. By planning for a future where AI and human expertise complement each other, organisations can foster innovation and ensure that employees remain at the heart of their operations.

The rising confidence among CEOs in investing in emerging technologies signals a forward-thinking mindset at the top. 85% of CEOs are confident about investing in emerging technologies —up 25% from September 2024—reflecting a broader trend in business confidence and a recognition of the need to embrace new technologies for growth and competitiveness.

Irish CEOs are not waiting for competitors to validate these technologies; instead, they are positioning themselves at the forefront of innovation, prioritising progress to avoid being left behind. This proactive approach is driving a wave of technological exploration aimed at enhancing operational efficiency and customer experiences.

The focus on updating existing technology infrastructure is equally significant, with 85% of CEOs investing in their current technology stack, indicating a growing awareness of cyber vulnerabilities and the risks associated with outdated systems. Ageing infrastructures are prime targets for cybercriminals, and businesses that neglect necessary updates are seen as easy prey.

Importantly, CEOs are also significantly increasing their investments in research and development (R&D) to fuel long-term growth and innovation. 87% of CEOs expressed optimism about investing in R&D and capital expenditure, a 30% increase from September’s survey. This shift highlights the recognition of the strong link between R&D investments and sustainable business growth.

By prioritising investments that yield long-term dividends, these leaders position R&D as a key driver of value creation, enabling businesses to adapt quickly, seize new market opportunities, and stay ahead of emerging trends.

Conclusion

Summary

CEO optimism is rising but tempered by geopolitical tensions and uncertainties. Agility and strategic investment are essential, focusing on talent retention, emerging technologies, and ethical AI. Many leaders are pursuing M&A and strategic alliances to enhance competitiveness, requiring careful integration and cultural alignment. By prioritising upskilling and embracing new technologies, CEOs can better position their organisations for success.