More than 80 per cent of the nearly 1,400 respondents report confidence in revenue growth in the short (next 12 months) and medium (next three years) terms. Despite this optimism, CEOs recognise that internal and external threats could inhibit business growth, primarily increased competition, loss of key talent, over-regulation, currency fluctuations and global terrorism.

Overwhelmingly, the survey finds that CEOs believe they can move their companies forward successfully but will need to be more aggressive risk-takers to do so. At the same time, managing these risks will hinge on implementing integrated enterprise risk management structures and processes within their organisations.

"Enterprise risk management is good medicine," said Samuel A. DiPiazza, Global Chief Executive Officer of PricewaterhouseCoopers. "It provides a framework for CEOs and management teams to deal with the risks and opportunities associated with uncertainty, in order to enhance value. It also increases CEO confidence in their business operations and encourages them to act more aggressively on behalf of their companies and stakeholders."

Managing in Today's World: The Threats to Business Growth

Asked to rank the leading threats to business growth, CEOs said that increased competition is the issue of foremost concern. Approximately 63 per cent of the CEOs consider it a threat. Of nearly equal concern is over-regulation, with 59 per cent. Forty-eight per cent of CEOs felt that currency fluctuations are a problem and 45 per cent felt that the loss of key talent could hamper success. Surprisingly, global terrorism was ranked fifth among major threats to business growth, at 40 per cent.

CEOs believe that these environmental factors have made the global business climate generally more risk-averse, even as CEOs view themselves as risk-takers. But they understand that to thrive in today's uncertain economy, they must develop a greater appetite for risk and a more systematic way of managing it.

Enterprise Risk Management Creates Value: Commitment to Implementation is Crucial

Respondents share the view that rigorous risk management is essential to corporate stability and long-term performance. Most CEOs are confident that basic risk management policies and processes are in place in their organisations. However, CEOs worry that significant barriers exist that might inhibit effective implementation.

While approximately two-thirds of the surveyed companies have basic processes in place, only one-third of the companies have achieved full implementation. Why? CEOs identify three top barriers: availability of information, timeliness of information and effectively trained implementation personnel.

Overall, however, it is the degree of commitment at the level of the CEO and board, and in the company as a whole, that ultimately affects the successful implementation of an enterprise risk management system.

"There is no question that enterprise risk management allows CEOs to take more aggressive risks, and, ultimately, enhance the value of their organisations," said DiPiazza. "It is crucial that all organisations implement successful enterprise-wide risk management systems, especially, if they expect to thrive in these uncertain times."

PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services for public and private clients. More than 120,000 people in 139 countries connect their thinking, experience and solutions to build public trust and enhance value for clients and their stakeholders.

"PricewaterhouseCoopers" refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.

Methodology:

This 2004 edition of the Global CEO Survey, seventh in a series, casts a wider net than any previous edition. Nearly 1, 400 interviews with CEOs were conducted on a worldwide basis in fourth-quarter 2003 (the precise number is 1,391), the great majority by means of 30-minute telephone interviews, with regional exceptions in Japan, where a postal survey was conducted, and in China, Kenya, and Nigeria, where face-to-face interviews were conducted. The research effort was coordinated by the PricewaterhouseCoopers International Survey Unit, based in Belfast, Northern Ireland, in close cooperation with a New-York based team of project managers and a global advisory board of PricewaterhouseCoopers partners.

By region, there were 454 interviews in Europe, 183 in the United States, 95 in Canada, 36 in Mexico, 257 in South America, 317 in the Asia-Pacific region, and 40 in Africa. By broad industry grouping, there were 242 interviews in financial services, 172 in technology and media, and 974 amongst consumer and industrial products manufacturers, distributors, and retailers (referenced hereafter as the product sector). Company size is also a critical measure: 39 per cent of the companies represented have more than 5,000 employees; 32 per cent have from 1,000 to 5,000 employees; 12 per cent employ between 500 and 1,000 in their workforce; and 15 per cent have a workforce of fewer than 500.

Thirty-five per cent of the respondents' companies earned revenue in excess of US$1 billion; 15 per cent earned between US$500 million and US$1 billion; 42 per cent earned less than US$500 million in revenue; and 8 per cent offered no information. The regional distribution, in revenue terms, shows the highest concentration of US$1 billion-plus companies in Europe (45 per cent), followed by Asia-Pacific (39 per cent), and North America (21 per cent).

New to the survey this year is an exploration of the findings for the 536 participating middle-market companies, defined as having less than US$500 million in revenue.