CEO Agenda 2026 series

Top CEO Concerns in 2026

Arcus CEO Agenda 2026 – Volume 6

A series on current topics that are impacting CEOs. Navigate your biggest challenges with insights. Arcus is a strategic ally to executive leaders navigating complexity and transformation.

Climate Transition Risk and the CEO’s New Strategic Imperative

Climate transition is no longer a peripheral issue for CEOs; it is a core driver of strategy, capital allocation, risk management and organisational resilience. Regulatory intensity is rising, investor expectations are tightening and operational exposure is growing. As climate risk accelerates, CEOs must balance the short-term economics of energy security with the long-term economics of decarbonisation.

The era of voluntary climate alignment is ending. Governments across North America and Europe are implementing stricter reporting requirements, carbon-pricing frameworks, emissions-reduction targets and sector-specific transition policies. Even in jurisdictions with political resistance, market forces are pushing climate considerations to the forefront. CEOs fear misalignment with future regulatory landscapes, which could result in unexpected penalties, stranded assets, costly retrofits and reputational damage.

Climate events add real operational risk. Extreme heat, wildfires, flooding, droughts and supply-chain disruptions impact business continuity, insurance costs and workforce safety. CEOs increasingly worry about the resilience of their physical assets, the reliability of electricity grids and the vulnerability of key suppliers. Climate resilience is now an operational priority, not a sustainability talking point.

Investors are demanding clarity. Major banks, pension plans and asset managers require credible transition plans linked to business fundamentals. CEOs who provide incomplete or unconvincing strategies face capital-access challenges, reduced investor confidence and higher perceived risk. Sophisticated investors are already integrating climate-adjusted valuations into asset pricing.

The transition also affects competitiveness. Firms that adopt clean energy, electrification and efficiency measures early gain cost advantages as fossil-fuel volatility and carbon-pricing schemes intensify. Companies that wait risk higher long-run energy costs, declining asset value and supply-chain misalignment.

However, the biggest CEO concern is execution risk. Transition requires large capital investments, technology adoption, workforce upskilling and long-term planning—often under uncertain regulatory conditions. Many firms struggle to operationalise climate strategy at scale.

For Arcus clients, climate transition strategy must be integrated into financial planning, operational design and corporate governance. Leaders must develop actionable roadmaps with technology pathways, risk buffers and measurable progress indicators. The winners will be those that approach climate risk as a strategic opportunity, not a compliance obligation.

Cyber Risk, Digital Trust and the Fragility of Modern Organisations

Cybersecurity is one of the top concerns for CEOs across all sectors. The threat environment has escalated dramatically due to geopolitical conflict, AI-enabled attacks, supply-chain vulnerabilities and insider risks. Organisations face an expanding attack surface as they adopt cloud systems, remote work, digital tools and advanced analytics.

Ransomware remains a major threat. Criminal groups are better funded, more coordinated and more capable. State-aligned actors target critical infrastructure, healthcare networks, logistics systems and major enterprises. CEOs recognise that a single breach can disrupt operations, compromise customer data, damage brand trust and incur regulatory penalties.

AI intensifies the risk. Generative AI is enabling more sophisticated phishing, automated vulnerability scanning and real-time evasion techniques. Attackers can now test thousands of vectors rapidly, making traditional perimeter defenses increasingly inadequate. Meanwhile, employees rely more heavily on digital systems, increasing the consequences of human error.

Supply-chain risk is another CEO worry. Modern organisations rely on thousands of third-party vendors, cloud platforms and digital tools. A vulnerability in any one of them can cascade across an organisation. CEOs must now assess cybersecurity beyond internal systems and evaluate the entire network of partners and providers.

Regulatory pressure is mounting. Governments are introducing mandatory breach reporting, cyber-readiness standards and sector-specific digital-security requirements. Non-compliance can result in financial penalties, legal action and forced operational changes. CEOs must balance regulatory obligations with operational realities.

The biggest concern, however, is trust. Customers, partners and employees expect secure and reliable systems. A breach impacts more than data—it affects loyalty, reputation and brand equity. CEOs fear that a single incident could undermine years of investment in market credibility.

For Arcus clients, cybersecurity must be framed as a strategic capability, not an IT function. Leaders must invest in real-time monitoring, AI-driven detection, zero-trust frameworks, crisis-response planning and employee training. Resilience depends on preparation, rapid response and organisational-wide awareness.

Digital trust is now a core driver of competitive advantage. Firms that cannot protect their systems cannot protect their future.

The Race for Supply Chain Resilience in a Highly Fragmented World

Supply-chain resilience remains front-of-mind for CEOs who have endured years of disruption—from pandemic shutdowns to geopolitical tensions, trade restrictions, freight congestion, natural disasters and inflation shocks. The global trading order is shifting, and firms must redesign supply chains built for efficiency into systems built for adaptability.

The old model centred on just-in-time production, concentrated manufacturing hubs and cost optimisation. That model delivered unparalleled efficiency but created fragility. CEO concern now focuses on geographic concentration risks, political instability, raw-material exposure and infrastructure reliability.

Nearshoring and friendshoring are accelerating. Firms are diversifying manufacturing to regions like Mexico, India, Vietnam, Eastern Europe and the United States. While this reduces political risk, it introduces new challenges: labour shortages, inconsistent quality, higher production costs and infrastructure constraints.

Technology is reshaping supply chains. CEOs recognise the need for end-to-end visibility enabled by AI, digital twins, predictive analytics and real-time monitoring. However, many firms lack the systems integration required to capitalise fully on these technologies. Legacy platforms, siloed data and inconsistent processes hinder transparency.

Logistics costs continue to fluctuate. Fuel prices, port congestion, labour disputes and capacity constraints increase unpredictability. CEOs must manage these fluctuations while maintaining service levels and customer expectations.

Climate risk also affects supply chains. Wildfires, heat waves, droughts and severe storms disrupt transportation routes, damage facilities and affect resource availability. CEOs worry that climate events will become a persistent and costly variable.

The financial implications are significant. Building resilience requires capital investment in diversification, redundancy, technology and inventory buffers. Many CEOs struggle to balance short-term cost increases with long-term risk reduction.

For Arcus clients, the shift requires a strategic recalibration. Resilience must become an integrated feature of supply-chain design rather than a reactive measure. Firms should pursue data-rich supply networks, dual/multi-sourcing strategies, strategic inventory management and regional balancing. The firms that invest early will gain competitive advantage in reliability, cost predictability and market agility.

Cost Efficiency and the Productivity Mandate in a Slowing Economy

CEOs face rising pressure to improve productivity and cost efficiency. Slowing growth, elevated interest rates, labour shortages and persistent inflation have squeezed margins. Leaders must find ways to reduce cost without sacrificing competitiveness, innovation or service quality.

Productivity has become a central priority. Digital tools, automation and AI offer powerful opportunities to enhance output and reduce waste, but adoption is uneven. CEOs complain about slow digitisation, cultural resistance, fragmented systems and unclear ROI. Many organisations remain stuck in legacy processes despite technological advances.

Labour costs are a major concern. Talent shortages in key digital and technical roles increase wage pressure, while hybrid work complicates workforce planning. CEOs must balance the need for competitive compensation with financial discipline.

Supply-chain costs remain volatile. Transportation, energy, raw materials and industrial inputs rise and fall unpredictably. Firms must adopt dynamic pricing strategies, contractual flexibility and real-time monitoring to maintain stability.

Overhead costs burden organisations. Office space, insurance, regulatory compliance and technology subscriptions accumulate and require regular review. CEOs are pushing for operational simplification, process elimination and smarter procurement strategies.

Revenue pressure compounds the challenge. In many industries, customer price sensitivity is rising. CEOs must navigate competitive pricing dynamics without eroding margins or compromising value. Product differentiation and customer experience become essential tools for defending revenue.

For Arcus clients, the path forward requires a disciplined approach to productivity. Leaders should prioritise digital transformation that simplifies workflows, AI automation in repetitive tasks, data-driven decision-making, and organisational redesign focused on speed and accountability. Productivity is no longer an operational goal; it is a strategic imperative.

The organisations that thrive will combine cost efficiency with innovation, creating leaner, more adaptive and more competitive models.

Business Model Reinvention for the Intelligent Economy

CEOs recognise that the shift to an intelligent, AI-driven economy requires deeper transformation than previous digital shifts. Incremental improvement is no longer enough. Many business models—whether in retail, manufacturing, healthcare, financial services or professional services—are misaligned with the emerging technological landscape.

Business model reinvention has become a priority driven by several pressures: evolving customer expectations, new digital-first competitors, declining productivity, climate transition, geopolitical uncertainty and rapidly changing technology. CEOs fear that legacy operating models will not withstand the next decade of disruption.

Customer behaviour is shifting. Consumers and businesses expect personalised experiences, instant service, transparency and digital ease. Traditional models that rely on manual processes, cumbersome workflows or limited digital engagement are quickly becoming obsolete.

Technology creates new competitive threats. AI-native firms, digital platforms, automation-based players and global scale operators can deliver products and services with lower cost and greater speed. CEOs worry that their organisations are too slow, too manual or too rigid to compete.

Workforce transformation affects business models as well. As AI automates more tasks, firms must redesign roles, integrate augmented decision-making and rethink organisational structures. This demands cultural adaptation and leadership alignment.

Revenue models are evolving. Subscription, platform, usage-based and hybrid models are growing across sectors. CEOs must decide whether to transition from traditional one-time or transactional models to more dynamic and recurring revenue systems.

Climate transition adds pressure. Firms must integrate sustainability into value propositions to meet regulatory, investor and customer expectations. Business models that fail to adapt will face cost disadvantages and brand erosion.

For Arcus clients, reinvention requires structured analysis and decisive action. Leaders must reassess core value propositions, develop AI-driven operating capabilities, modernise customer interfaces, simplify organisational design and adopt scalable digital architectures. Reinvention is not optional; it is existential.

The firms that successfully redesign their business models will set the direction for their industries. Those that resist risk structural decline.