UK banking CEOs issue warnings on cyber threats and job cuts - PwC survey

Published at 00:01 AM on 17 February 2016

UK banking CEOs are preparing for cyber-attacks, predicting a decline in staff numbers and planning tax changes to reflect tougher stakeholder expectations over banking transparency.

That’s according to PwC’s 19th Annual Global CEO Survey, which suggests that some of the expectations of UK banking CEOs differ markedly from CEOs elsewhere, suggesting a sector still in the throes of significant change.

Almost 4 in 10 banking and capital markets leaders were particularly concerned about cyber threats (36%) – above UK CEOs in general (28%) and CEOs globally (21%).

The Global CEO Survey found that two-thirds of UK business leaders are planning to increase their organisation’s headcount in 2016, a higher proportion than their peers in any other European country and in most markets worldwide. 

However, only 43% of UK banking chiefs forecasted an increase in recruitment (vs 48% of global CEOs).

29% of the UK banking leaders surveyed also said they would expect headcount to decrease over the next 12 months, compared to 20% of all UK CEOs and 21% of global CEOs.

CEOs were asked what aspects of their talent strategy they were changing to make the greatest impact on attracting, retaining and engaging the people they need to remain relevant and competitive:

32% of banking leaders said pay incentives and benefits they provided to the workforce vs 40% of all UK CEOs and 33% of CEOs globally.

In addition, while 6% of all CEOs across the UK plan to respond to changing stakeholder expectations by making significant changes to how they manage their tax affairs, that figure rises to 18% of UK banking respondents, the Global CEO Survey found.

Simon Hunt, UK banking and capital markets leader at PwC said:

“These findings show that UK banking leaders are not only taking the threats stemming from economic pressures, regulation and reputational risk management seriously- but that newer risks, for example cyber, are very much on their radar.

“The views also reflect the significant cost pressures many of these institutions are currently feeling."

Perhaps reflecting the global nature of banking, 27% of UK bank CEOs were more aligned with global CEOs (24%), in voicing significant concerns about bribery and corruption. Only 7% of all UK CEOs held major concerns about this potential threat.

Exploiting technology to meet the requirements of various stakeholders is a key priority for UK CEOs in general; 95% stated they are changing how they use technology to assess and deliver on wider stakeholder expectations, compared to 90% globally, PwC found.

A large proportion of UK CEOs, 86% agree that technological advances will be the global trend most likely to transform those stakeholder expectations over the course of the next five years - slightly ahead of global CEO total of 77%.

At the same time, UK CEOs are becoming more relaxed about the speed of technological change, with 56% citing this as a concern, down from 59% last year, and well below this year’s global figure of 61%.

This means UK business leaders’ concerns over the pace of advances in technology is now back down to roughly the same level as in 2013, while during the same two-year period the level of concern globally over the speed of technological change has surged from 47% to 61%.

Simon Hunt, UK banking and capital markets leader at PwC, said:

“New technology developments such as Blockchain, Artificial Intelligence and a myriad of other Fintech initiatives should help banks foster a more informed, engaged relationship with customers but in the near term they are also likely to disrupt the industry.

“Those institutions that succeed will be the ones who successfully harness these developments to engage more effectively with their customers and reduce the costs of their platforms."

“While recognition of the prize is obvious from the CEOs surveyed, some banks are already acting fast on this while others may need to move faster."

Explore the data here: http://www.pwc.com/gx/en/ceo-agenda/ceosurvey/2016/explore-the-data.html

Watch PwC UK's executive board member for clients and markets Dan Schwarzmann's live webcast on cyber security on 2 March at 11am here:

http://pwc.to/23Nay6k

ENDS

Notes to Editors:

About the Global CEO Survey

PwC’s report ‘Creating a platform for competitive regeneration’, is based on responses from 176 Banking & Capital Markets CEOs in 62 countries.

To see the full results of PwC’s 19th Annual Global Survey, please visit www.pwc.com/ceosurvey

About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 157 countries with more than 208,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

©2016 PricewaterhouseCoopers. All rights reserved.


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About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 157 countries with more than 208,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details. © 2016 PwC. All rights reserved

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