Australian CEOs are optimistic about the global economic outlook over the next 12 months but lag global peers in adapting to disruptive forces, a PwC survey has found.

Almost half (47 per cent) of Australian business leaders believe that global growth will increase over the next 12 months, up from 37 per cent last year, according to PwC's Annual Global CEO Survey.

However, Australian businesses are falling behind global peers when it comes to realising business opportunities related to technological disruption and climate change. This could pose risks to their future outlook, the report warned.

“Businesses in Australia are well and truly feeling the impacts of global disruptive forces. Disrupters such as AI and climate change have fundamentally changed the way we work, and those who responded early are starting to reap the rewards,” Kevin Burrowes, chief executive of PwC Australia, said.

“In Australia, the survey suggests some CEOs are taking bold steps to reinvent their business models, but many are yet to get started. While responding to these trends can be challenging, it’s important to take the leap now so businesses don’t miss the opportunity altogether.”

While 88 per cent of Australian CEOs said AI adoption would be important in achieving their company’s business goals over the next three years, only 14 per cent directly connected AI to increased profitability, and just 10 per cent to revenue increases.

This may reflect a lower level of AI adoption in Australia in comparison to global peers, who reported that AI adoption had delivered them 32 per cent increases in revenue and 34 per cent in profitability in the last 12 months.

Trust in AI remains a hurdle to adoption, with only a third of global CEOs saying they had a high degree of trust in embedding the technology into key company processes.

Australia also lagged behind global benchmarks in climate change adaptation, according to PwC. Less than one in five (17 per cent) of Australian CEOs reported revenue growth as a result of climate-friendly policies, compared to 33 per cent of global CEOs.

Around the world, top barriers faced by CEOs who looked to initiate climate-related investments included regulatory complexity (24 per cent), lower returns on investment (18 per cent) or lack of buy-in from management or the board (6 per cent).

Australian CEOs are in an optimistic, expansionary mindset, the survey found. The proportion of CEOs that expect to increase headcount over the next 12 months (41 per cent) eclipses those who expect headcount decreases (22 per cent).

“As CEOs consider success in 2025, taking bold steps to address and embrace technological disruption and climate change have proven to drive results around the world. What’s clear is that reinvention is no longer an option – it’s time to self-disrupt or risk being disrupted,” Burrowes said.