Chief Executive Officer, Teneo Holdings LLC
Teneo CEO Paul Keary Discusses Teneo's 2025 CEO & Investor Outlook Survey on Fox Business from Davos
Teneo CEO Paul Keary joins Maria Bartiromo on Fox Business’ ‘Mornings with Maria’ from the World Economic Forum to unpack insights from Vision 2025, Teneo’s annual CEO and Investor Outlook Survey. The survey of 300 global public company CEOs and 380 institutional investors highlights soaring optimism in the outlook for 2025, driven by expectations of pro-business policies, accelerated AI investment and robust M&A activity.
Access "Vision 2025: Where is the World Going in 2025 and Beyond?" here: https://www.teneo.com/vision2025/
#TeneoVision2025 #Vision2025 #TeneoatDavos #WEF25 #Davos
About Paul Keary
Paul Keary appeared on Fox Business from the World Economic Forum in Davos on January 22, 2025, to discuss findings from Teneo’s "Vision 2025" survey. The survey of 300 global CEOs and 380 institutional investors found that 77% of CEOs and 86% of investors expect the global economy to improve in the first half of 2025. Keary said the optimism was "directly correlated to the win in the election by President Trump" and described it as spanning industries and regions, with domestic U.S. companies planning to grow their U.S. operations and international companies looking to expand in the U.S. Keary also addressed investment in artificial intelligence, noting that nearly all surveyed public company CEOs are maintaining or increasing their AI investments and that investors expect a positive return within one to two years. He said there was an expectation in Davos that the U.S. will adopt a regulatory environment more suited to business expansion, maintain tax incentives, and support M&A activity, while characterizing Europe's outlook as "more hope than expectation."
Transcript (29 segments)
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Interviewer0:00
Teneo's Vision 2025 CEO and investor survey finds soaring confidence in the global economy following President Trump's return to the White House. 77% of CEOs say they expect the global economy to improve in the first six months of this year. That's a 32 percentage-point year-over-year increase. 86% of investors feel the same. Joining me now is the CEO of Teneo, Paul Keary. Paul, it's great to have you.
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Paul Keary0:23
Thank you.
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Interviewer0:23
Thank you so much for being here. Have you ever seen, or when was the last time you saw this kind of optimism about the US economy?
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Paul Keary0:28
We haven't seen this in our data. We've been capturing this for years.
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Interviewer0:32
You've never seen this kind of optimism?
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Paul Keary0:34
No. We were in the field talking to 700 CEOs and investors, about $10 trillion at market cap, so it's a substantial sample size, just after the election towards the end of the year. And all roads lead to America as a consequence. This wasn't just global optimism, it wasn't just American optimism, it was optimism directly correlated to the win in the election by President Trump. And that is cross-industry and it's across region. So if you think about domestic US companies, they're thinking about growing their operations in the US. Think about international companies, they're thinking about expanding their operation in the US, which means more jobs, more investment, and more opportunity. It's an unparalleled level of appreciation and optimism.
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Interviewer1:15
That is amazing. And does it all go back to policy? The fact that they are expecting deregulation, they're expecting their money to be treated well with lower taxes and investment opportunities, growth?
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Paul Keary1:27
There's a number of key points. You're right, there's an expectation that there'll be a more business-friendly regulatory environment that's more suited to business expansion, growth, M&A. There's an expectation that the tax incentives will be maintained and facilitated for the business community. There's also the reality that the American economy is about to hit a new era of growth, and having the right policies and legislation in place to enable that growth is what the global market is expecting.
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Interviewer1:57
I know the survey also found that more than 64% of those CEOs say that the policies will have a positive impact on their business this year. 50% said that they are accelerating domestic and international hiring activities, and more than 80% said that they expect a major return of M&A activity. Where would you expect that M&A volume to take place in terms of sectors?
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Paul Keary2:16
Yeah, in our survey it was revealed healthcare, tech, manufacturing are some of the top areas where you can expect M&A. Some industries have been boxed out over the last number of years because of regulatory constraints. So it's across the board, but there's primary focus on those areas.
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Interviewer2:33
And tell me about potential for investing in America. President Trump securing, what, $1.1 trillion in investment in America just in the last two days. Are you hearing that kind of sentiment? People want to invest in the US as well?
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Paul Keary2:46
Yeah, the level of conversations across companies and across nations is to understand how to get on board the America train. The economic train, as we called it in our report, is the Trump effect. It's directly correlated to the election and the expectation of a different tax and regulatory regime. But the Kingdom's announcement today, which you covered yesterday, $600 billion of investment within the US economy, I think is indicative of some of the calculus that companies and countries are running currently about how they put their capital, where they place their bets. And the US is number one on that option list.
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Interviewer3:18
And we just heard from Sarah Friar from OpenAI and she's talking about this project creating jobs. I want to get your take there as well, because AI has been a major focus here in Davos. Your survey found nearly 80% of investors expect a positive investment return on AI projects within the first year. 41% of the large-cap CEOs expect returns over one to two years. Paul, talk about that. What are you expecting in terms of investing and the returns you're getting?
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Paul Keary3:49
Yeah, Sarah said to you it's the AI era. So the data points you raise are correct. Also interestingly, almost 100% of public company CEOs surveyed are maintaining or growing their AI investments this year. And the expectation is that they will get a return on that investment probably in the two-year time frame. Investors, however, are demanding a shorter ramp-up to that return. I think what I'm finding also in conversations in Davos right now, there's an expectation that the promise of AI and the application build is going to lead to a hockey-stick appreciation for opportunities for companies to take more commercial advantage of the AI wave. So I expect this time next year we'll be talking about the AI era having kicked into a much more aggressive time.
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Interviewer4:36
So you're talking about a very fast turnaround. And in fact, that's what President Trump said, this is going to happen fast. Is that what the expectation is? You'll be investing here, you'll be utilizing these new policies, and you'll get a fast return on your investment?
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Paul Keary4:50
Fast return on your investment. I think, and you've spoken to many great CEOs about this matter and talking to more this afternoon, but there's an energy supply dynamic that needs to be resolved. There is an engineering requirement to be resolved. But there is a high expectation on the investment community, particularly, that the promise of AI will yield applications that will deliver real business promise.
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Interviewer5:10
What are your clients worried about?
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Paul Keary5:13
They are worried about, I think, some of the issues that you've covered very well. What happens with the Chinese market, what American businesses can do in terms of business in China, what's the regulatory and legislative framework so they can clearly deploy capital or not in China, what industries are subject to national security considerations appropriately, and which industries should be free to extend their partnership and their consumer opportunity in that market. So this deglobalized environment currently is a challenge because there's large customer opportunities being missed as a consequence.
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Interviewer5:44
Do you think companies want to rely less on the China supply chains? That has happened.
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Paul Keary5:51
One of the interesting survey data points as well: America was the primary destination for capital, but the Gulf and India were second and third. So I think India is the net beneficiary, probably benefits more from China being blocked out of some of these commercial conversations.
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Interviewer6:08
That's a very interesting point. I've also been hearing a lot about India. What about Japan?
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Paul Keary6:10
Well, Japan is a very aggressive deployer of capital. It's a very strategic partner right now across the world in terms of how it grows its industries.
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Interviewer6:21
And are you hearing disappointment about the Euro Zone? Because there are structural issues. We've been talking about this morning.
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Paul Keary6:27
I think President von der Leyen made a very powerful speech early this week about the need for Europe to deregulate to meet the moment and the opportunity. So I think there's more hope than expectation in terms of the European opportunity, which again is partly the factor I think that's leading to an America First economic argument right now.
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Interviewer6:44
Well, we're speaking with the President of Poland, and one of his officials said that President Trump's revolution of common sense is taking hold throughout Europe. Would you agree that these policies that President Trump is talking about deploying in America are also being talked about potentially for Europe?
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Paul Keary7:04
Absolutely. I think smart regulation, smart tax system, and an opportunity to think about big global problems on an integrated basis.
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Interviewer7:13
Yeah. What about interest rates? I mean, where does that come into the conversation? We did see a spike in rates at the end of last year, although the 10-year is back down. But do you see companies worried about what the Fed does next?
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Paul Keary7:25
I think the market's largely priced in the Fed's action. I think the M&A market is not going to be suppressed by that Fed dynamic. I think the opportunity is still supported. M&A is going to be a boon. M&A is also going to bring activism. There's going to be a lot of action in the US economy. It is going to be Hold On Tight 2025.
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Interviewer7:43
Here we go. Paul, it's great to have you this morning. Thank you. Thank you so much. Paul Keary here.