Directors are optimistic about the economy, but directors have identified key challenges for the post-pandemic recovery, according to the AICD’s latest Director Sentiment Index.
The second DSI of 2021, which surveyed more than 1,600 directors and was compiled by research firm Roy Morgan, reveals that directors have a bullish outlook for business and the economy.
The Index is in positive territory, with more director optimism than pessimism, and an overall score of +17.9.
More than two-thirds of directors are confident in Australia’s 12-month economic outlook. Nearly two thirds (64 per cent) believe business will be on sure footing in 12 months time, with positive indicators like investment, turnover and profits expected to grow.
While the overall outlook from directors is positive, key challenges are emerging for the post-COVID era.
Directors have identified workforce shortages as the top economic challenge facing Australian businesses, above COVID-19, climate change and Australia’s relationship with China.
Climate change remains the top short- and long-term priority for the Federal government to address.
Other key findings from the Director Sentiment Index (Second Half 2021) include:
- 73 per cent are seeking to increase skills diversity on their board.
- 76 per cent say business should make COVID-19 vaccines mandatory for staff in their sector.
- 59 per cent of directors agree their board is seeking to increase diversity in digital capability and technology.
- Across the major states, trust for State Government is highest in NSW and South Australia.
- Sentiment towards the economies of the United States and Asia (excluding China) are positive for the next 12 months, but only 35 per cent believe Europe will be in a strong economic position.