EY-Parthenon "71% of Domestic Companies Expect Performance Growth This Year Compared to Last Year"

[Asia Economy Reporter Ji-hwan Park] Seven out of ten domestic business executives expect their management performance to improve this year compared to last year.

EY Han Young Accounting Firm's strategy consulting organization EY-Parthenon announced the results of the "2021 Economic Outlook Survey" containing this information on the 4th.

The survey was conducted at the "EY Han Young New Year Economic Outlook Seminar" held last month targeting corporate CEOs and executives. A total of 286 people participated in the survey.

In response to the question, "Do you expect management performance to grow this year compared to 2020?" 70.9% of respondents answered yes. This is an increase of 18.9 percentage points from the positive response rate (52%) to the same question conducted in January 2020.

By company size, companies with assets under 500 billion KRW (73.3%) and those with assets between 500 billion KRW and 5 trillion KRW (74.4%) particularly answered that their management performance would grow. For companies with assets over 5 trillion KRW, the response rate expecting growth was only 66%. By industry, companies in the Electronics and IT (75%) sectors showed the highest growth expectations.

The growth expectations of business executives are interpreted as reflecting their perception of the impact of COVID-19 on the economy. 68.9% of respondents answered that the impact of COVID-19 on the domestic economy this year would improve significantly or somewhat compared to last year.

Regarding the outlook for the domestic economy this year, 41.6% of respondents expressed a very or somewhat positive view. Only 29% of business executives viewed it as very or somewhat negative. In the same survey last year, 79% of respondents predicted a very or somewhat negative outlook.

However, differences in perception among industries were observed. Companies in telecommunications (very or somewhat positive 57%), energy and chemicals (54%), and finance (50%) industries had a relatively positive outlook on the domestic economy. On the other hand, companies related to distribution (very or somewhat positive 24%) and vehicles and transportation (24%) had relatively fewer respondents with a positive outlook.

EY-Parthenon interpreted, "It appears that companies perceive this year as a year of rebound, turning the crisis caused by COVID-19 into an opportunity beyond mere adaptation to change." They added, "Especially in contactless-related industries such as telecommunications, finance, and electronics, strong growth expectations are emerging." Furthermore, they advised, "A base effect of relatively more positive views compared to last year also played a role. In a situation where values in the economy, industry, and society have changed due to COVID-19, companies need to rethink their future strategies to find new growth engines."

This content was produced with the assistance of AI translation services.