Top business execs remain bullish on growth – survey

Amid bribery, corruption concerns

MANILA, Philippines - The country’s top business executives are welcoming with high hopes the change being promised by the Duterte administration as they remain bullish about the future of their businesses and the economy despite emerging concerns about bribery and corruption, a joint study by the Management Association of the Philippines (MAP) and Isla Lipana & Co./PwC Philippines showed.

The MAP and PwC unveiled yesterday the results of the 2016 Philippine CEO Survey Report, which gathered inputs from large corporate and small and medium enterprise leaders regarding their sentiments amid the change in government and the factors affecting the local business landscape.

The report revealed 78 percent of CEOs and business leaders polled believe that gross domestic product growth would either hit or exceed this year’s forecast of six to seven percent, while 80 percent expect the same for next year’s GDP growth forecast.

CEOs and business leaders are likewise optimistic on their respective company’s growth, with 94 percent of them expressing confidence about their revenue growth prospects in the next 12 months.

Over the next three years, meanwhile, 93 percent of them indicated confidence in their companies achieving revenue growth.

In terms of their industries’ revenue prospects, 86 percent said they are confident it would grow in the next 12 months.

A total 81 percent of the CEOs and business leaders surveyed agreed there are more opportunities for growth for their businesses now than there were three years ago.

This optimism resulted from growth drivers such as population and pool of highly skilled talent, the report said.

“This year’s survey results are a bit more optimistic. The confidence is higher. Last year going into the survey, CEOs also have in the back of their mind the uncertainty that will be brought by the national elections the following year. So now that the elections are over, the uncertainty is gone on who will lead the nation so that also gave them more confidence in terms of what is going to happen,” said Mary Jade Roxas-Divinagracia, PwC Philippines managing partner for deals and corporate finance.

For this year’s survey, however, bribery and corruption emerged as among the top three biggest concerns cited by business executives as potential threats to companies’ growth prospects.

Over-regulation and increasing tax burden remain as the two major concerns with 79 percent and 78 percent, respectively.

Some 76 percent of the business executives, meanwhile, expressed alarm about bribery and corruption as a potential business growth threat.

In last year’s report, bribery and corruption were not part of the three top concerns which included increasing tax burden, overregulation and skills shortage.

When it comes to changes or initiatives they want the government to prioritize in the next six years, 69 percent of business executives identified adequate physical infrastructure, followed by good governance at 63 percent and internationally competitive tax system at 55 percent.

“The problems that become more prominent last year are the geopolitical risks. The problems last year were more regional and global. People have learned to live with that so the only thing left to be done is in our country. Are we able to really stamp out corruption? More of a concern, I think CEOs are expecting that for once and for all, we may be able to stop this that’s why they’re putting it on top of their list,” PwC Philippines chairman Alexander Cabrera said.

This year’s report surveyed 98 CEO respondents while 21 CEOs were interviewed. Some 34 percent of the respondents came from large corporations or those with 250 employees or more, while the remaining came from micro, small and medium enterprises.