business news in context, analysis with attitude

From National Public Radio's Marketplace, a pair of reports that suggest a disconnect between consumer and CEO attitudes.

The first story:

"Consumer confidence has fallen — again.

"This is the latest gauge of American consumer attitudes taken by The Conference Board think tank. For August, its Consumer Confidence Index came in at 84.8 - below expectations and down from 91.7 in July. It was down quite a lot from June - 98.3 - when there was a fair amount of optimism building among consumers as the economy reopened and some folks were called back to work.

"But the summer surge in COVID-19, states pausing their reopenings, schools starting virtually and gridlock in Washington over extending unemployment benefits - it’s all taking a toll on the American consumer."

The second story:

"While some have lost their optimism in their businesses or the economy since the beginning of the year, many CEOs are still optimistic their business will continue to grow, according to the accounting firm KPMG’s annual U.S. CEO outlook survey."

Marketplace writes that "about 60% of CEO respondents said they were 'more confident' in their businesses’ growth prospects compared with the beginning of the year."

KC's View:

One of the interesting things about the CEO numbers is the implication that even as most CEOs are optimistic, they also are using the circumstances of the pandemic to reorder their priorities.

For example, "74% indicated they were prioritizing investments in digitization of their business strategy over developing their workforce’s skills and capabilities," while "69% said they will downsize their office space," and "58% said the pandemic has changed their focus towards their environmental, social and governance-related programs."

It may, in fact, be that one of the reasons that they are confident is that these CEOs feel that they are being given the opportunity to strengthen their companies' foundations - infrastructural, organizational, ethical - in ways that will pay dividends long-term.

KPMG Chair and CEO Paul Knopp, asked about one statistic - 77 percent of CEOs say that "they need to reevaluate their corporate purpose as a result of COVID-19" - replies that "when you think about purpose, it’s very much a stakeholder view. You’re looking broadly at your impact on society in what you do and how your strategic actions within the business will impact all those different stakeholders. When we think about purpose - and the study certainly reveals that CEOs are much more focused now on purpose, values, culture, employee engagement - that is very important for our future, and we are very focused on how we sustain strong cultures while we’re working more remotely into the future."

It is a broader view about how business fits into and reflects society that is becoming much more important in a world that we'd like to be more civilized than it actually is.