How do CEOs plan for a recession? It’s time to find out


A recession is now almost universally expected among business leaders. A recent KPMG CEO Survey found 91% believe it will hit within the next 12 months, and only 34% believe it will be soft and short.

But how should businesses prepare for this widely anticipated downturn? This remains a subject of debate. As the bottom line declines, it is natural to assume that companies will reduce spending on areas such as digital transformation or ESG initiatives. And indeed, the KPMG survey found that 59% of CEOs say they plan to “pause” or “reconsider” their ESG plans over the next six months.

Yet I continue to find myself in conversations with forward-looking CEOs who insist that it’s times like the present that test their mettle. They believe continued investment, both in digital transformation and sustainability, will be critical to their long-term success. And those who can find a way to sustain investments, even in the face of a downturn, will win the future.

How do you do this exactly? It’s a question I plan to ask many top CEOs over the next two weeks. On Tuesday, I’ll be at Oracle’s User Conference in Las Vegas, speaking onstage with Deloitte CEO Joe Ucuzoglu. Next, I’ll head to San Francisco, where Fortune’s Michal Lev-Ram will interview Nvidia CEO Jensen Huang at our West Coast Fortune Global Forum dinner. Two days later, I’ll be interviewing JPMorgan CEO Jamie Dimon at the East Coast version of the same event.

I also look forward to hearing from CEO Daily readers. What is your strategy for maintaining growth and continuing transformation even as the economy contracts? Share your thoughts, and I’ll report back later this week.

By the way, it’s already clear that the battle for talent continues, even as the recession looms. Otherwise, how can you explain the fact that the unemployment rate has down in September — at 3.5%? That’s why companies are paying so much attention to the great return to power debate – a debate in which Meta CEO Mark Zuckerberg and Airbnb CEO Brian Chesky have taken very different approaches, as Hillary Hoffower’s story shows it yesterday.

More news below.

Alan Murray

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Goldman reorganization

Goldman Sachs will combine its investment banking and trading businesses into a single unit, in a sweeping reorganization that will also see its asset and wealth management businesses merged into another division. Another unit will incorporate Goldman’s transaction banking and fintech businesses, as well as its ties to Apple and GM. the wall street journal

grilled farm

British business figures are calling for the defenestration of Prime Minister Liz Truss, whose pro-growth agenda is in shambles after she sacked fellow Libertarian Chancellor Kwasi Kwarteng and replaced her with ideological opponent Jeremy Hunt. Asda chairman Stuart Rose called it a “bust flush” and private equity bigwig Guy Hands (of Terra Firma Capital Partners) said “an adult needs to take over…before that the lights do not go out irreversibly on this great nation”. A group of Truss lawmakers also want her out immediately. FinancialTimes

Trump whistleblower

Will Wilkerson, a former executive at Truth Social owner Trump Media, went to the SEC with a whistleblower allegation that the company’s attempt to merge SPAC was based on “fraudulent misrepresentations.” Wilkerson has now been fired, in what his attorneys say was “blatant retaliation against an SEC whistleblower of the worst kind.” He gave the media and federal investigators a cache of internal documents to back up his claims. Washington Post


EU to propose gas price cap to avoid ‘extreme volatility’ as winter looms in energy crisis, per Bloomberg

Nobel Prize-Winning Economist Warns Fed Will Cause “All Kinds of Trouble” if It Continues on Its Current Path, by Shawn Tully

Mark Zuckerberg’s metaverse is criticized in internal documents: “An empty world is a sad world”, by Steve Mollman

Elon Musk withdraws from request for help funding Starlink in Ukraine, per Bloomberg

Goodbye, lightning charger. Hello, USB-C. EU forces Google and Apple to adopt universal charger, likely setting new global standard, by Vivienne Walt

This edition of Daily CEO was edited by David Meyer.

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