Companies expect recovery to take up to 18 months on average
European companies that accelerate both their digital and sustainability transitions are likely to recover faster and emerge stronger from the COVID-19 crisis, according to a new report from Accenture.
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“Even companies that recognize the business opportunity to accelerate their digital and sustainable transitions face barriers at different stages of this twin transformation journey”
“The European Double Up: A twin strategy that will strengthen competitiveness,” launching during The Davos Agenda week, finds that European business leaders expect to return to their pre-pandemic profit levels in 18 months on average.
According to the report, the COVID-19 crisis has resulted in a divergence in European companies’ resilience and growth prospects:
- Half (49%) of European companies have been reporting revenue or profit decline for the past 12 months and don’t expect any improvement in the next 12 months.
- One-fifth (19%) of European companies had strong financial performance before the pandemic but now expect negative revenue or profit growth in the next 12 months. The report refers to these companies as “falling angels.”
- One-third (32%) of European companies expect to deliver profitable growth in the next 12 months. The report refers to these companies as “tomorrow’s leaders.”
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The report indicates that companies leading in both digital adoption and sustainable practices are nearly three times more likely than other companies to be among “tomorrow’s leaders,” thereby recovering faster and emerging stronger from the crisis.
“Digital transformation defined the business landscape in the 2010s, and companies that led this transformation at speed and scale won the day,” said Jean-Marc Ollagnier, CEO of Accenture in Europe. “We are entering a decade that ushers in a new wave of business change defined by the sustainability transition. How European companies manage this ‘twin transformation’ will determine how quickly they will recover from the crisis and how well they will be positioned to sustain growth in the post-pandemic world.”
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