CEOs doubling-down on the return-to-office debate

In the 10th edition of the KPMG CEO Outlook, we capture insights from global and Philippine business leaders on key topics such as the race to embrace artificial intelligence and rising geopolitical concerns.

In this four-part series, we begin by focusing on Talent — examining internal challenges like workforce upskilling and hybrid work models. We also explore how Philippine CEOs are addressing these issues, comparing their approaches with global trends as they navigate the pressures of staying agile, managing stakeholders and driving long-term growth.

In today’s evolving work landscape, employees are seeking greater flexibility in their work arrangements and a nurturing environment that supports their diverse needs.

Leaders who respond to these expectations foster talent by creating adaptable environments, which is especially important during challenging economic times.

This years’ findings reveal that CEOs are hardening their stance on returning to pre-pandemic ways of working. In the Philippines, majority of the CEO respondents envision a return-to-office arrangement in the next three years for corporate employees whose roles were traditionally office based.

Moreover, half of Filipino CEO respondents shared that employees who regularly come into office may naturally have greater visibility for assignment, raises or promotions, while the other half have expressed neutrality on the matter.

Globally, the expectation to return-to-office increases with the age of the CEO, reaching 75 percent for those aged 40 to 49, 83 percent for those aged 50 to 59 and 87 percent for those aged 60 to 69.

Notably, a gender divide exists, as 84 percent of male CEOs predict a full return to the office within three years, compared to 78 percent of female CEOs.

CEOs worldwide are increasingly concerned about talent-related issues that could affect future growth and competitiveness, with nearly a third expressing concern over labor market shifts, particularly the impeding retirements of employees and the shortage of skilled workers to replace them.

This concern is also emphasized in the Philippines, where more than two-thirds of Filipino CEO respondents believe that labor market shifts, particularly the aging workforce, have a moderate impact on their organization’s recruitment, retention and overall culture.

In relation to talent shortage and the need to secure access to future talent, more than half of the respondents from the Philippines believe that organizations should prioritize investing in skills development and lifelong learning within local communities.

Through this commitment, leaders can expect an increase in the overall headcount of their workforce in three years.

Inclusion, Diversity and Equity: A Commitment to Progress

This year’s survey sheds light on the evolving perspectives of Filipino CEOs regarding inclusion, diversity and equity (IDE).

While over half of the respondents believe that business leaders have the responsibility to drive greater social mobility, there is also recognition that progress has been slower than desired, with some expressing concern over the pace of change.

As organizations prepare for the future, majority of CEO respondents in the Philippines anticipate that their diversity performance will be scrutinized more closely in the next three years. This shift suggests a growing awareness on the importance of accountability in IDE initiatives.

Moreover, nearly half of respondents emphasize the need to achieve gender equity in C-suite roles, viewing it as crucial in realizing their growth ambitions.

To drive meaningful change, nearly half of CEOs in the country recognize that leadership commitment at the senior level is essential.

However, there remains uncertainty, as the other half of the Filipino CEO respondents are unsure about the use of mandated quotas and targets to drive sustainable and long-term diversity.

While these insights reflect both the challenges and opportunities that lie ahead, they also highlight a collective commitment among Filipino CEOs to prioritize IDE within their organizations.

The journey may be gradual, but with a shared focus on improvement, Filipino business leaders are positioned to advance their IDE initiatives in the coming years.

About the KPMG 2024 CEO Outlook

The 10th edition of the KPMG CEO Outlook, conducted with 1,325 CEOs globally between July 25 and Aug. 29, 2024, provides unique insight into the mindset, strategies and planning tactics of CEOs.

Sharon Dayoan is the Chairman and CEO, and Head of People, Performance and Culture of R.G. Manabat & Co., a Philippine partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. For more information, you may reach her through [email protected], social media or visit www.home.kpmg/ph.