Catalysing competitiveness in the age of AI

Channel Islands CEOs are confident about revenue growth

Channel Islands CEOs are a little more optimistic than their global peers about growth in the global economy over the next 12 months. However, CEOs’ confidence in our local island economy has declined slightly since our last survey. However, 38% of local business leaders are extremely confident about revenue growth over the next 12 months, which, although down slightly from last year, is a larger share compared to the global average of 31%.

Looking further ahead, 89% of Channel Islands CEOs are moderately, very, or extremely confident about their revenue growth over the next three years, signalling that business leaders are planning new strategies for success. This is again better than the global average of 86%.

Juxtaposing weaker sentiment about the domestic economy with a much stronger revenue outlook suggests that Channel Islands businesses are looking overseas for new growth and underlines the need for the islands to focus on continued jurisdictional competitiveness.

The majority of CEOs are competing in new sectors and investing overseas

PwC’s Value in Motion research explains how industries are reshaping into domains of growth – and the massive opportunity that this provides to companies worldwide.

It is clear that value is indeed already in motion in the Channel Islands. Nearly two-thirds (62%) of businesses have already moved into new markets and services outside their own industry in the last five years – highlighting their strategic agility and drive for diversification in response to market changes. This is notably higher than the 42% of CEOs globally who reported having already entered new markets.

Looking forward, some 51% of Channel Islands CEOs are planning to grow their businesses further in other industries (including diversification and partnerships) over the next three years. This is being led by the financial and professional services sector, with 33% looking to new into new financial services, and 18% into different asset classes.

The UK remains the top destination for Jersey and Guernsey CEOs, reflecting long-standing financial, legal and professional services links and the islands’ positions as part of the British family of financial centres. At the same time, Channel Islands CEOs are looking to the US and to growth in the Middle East. Centres like Dubai and Abu Dhabi are climbing the global league tables through bold regulatory reform, digital asset leadership, and targeted talent strategies.

Local CEOs are concerned about geopolitical risks and associated cyber threats

Channel Islands CEOs continue to feel exposed to threats arising from a range of global megatrends and geopolitical uncertainties.

Top of the list is a macroeconomic volatility, aligned with global CEOs.

Cyber risk now ranks as one of the top threats across most jurisdictions globally and came third locally. This year, it’s compounded by the rapid rise of new, fast-moving, AI-driven threat vectors (including agentically-empowered bad actors), the rapid adoption of new AI technologies with limited safeguards, and AI model-specific vulnerabilities (including context poisoning and prompt injection).

But our business leaders are not wasting time in addressing these potential threats. All of the CEOs we spoke to plan on improving their enterprise-wide cybersecurity over the next three years to defend against cyber-attacks. Given the islands’ reputations as safe and secure jurisdictions, with high dependence on digital infrastructure and cross-border financial services, cyber resilience remains foundational for their competitiveness.

Your next move:

• Make cyber resilience a Board priority. Update your security strategy for AI-enabled threats, including identity, data protection, monitoring response and third-party risk.
• Choose what to run in-house versus managed services and invest in the skills to operate it.
• Test readiness regularly with clear metrics. Gaps in preparedness can undermine confidence among clients, regulators and investors.

CEOs are taking practical steps to manage climate risk

Sustainability is now a core part of business strategy and requires CEOs to understand and master new drivers of value creation.

It’s therefore reassuring that 42% of Channel Islands CEOs now have processes for integrating climate risk and opportunity into capital allocations, 37% into supply chain and sourcing strategies, and 31% into product design and development. The link to capital allocation is particularly important given the role of the Channel Islands as conduits of capital to finance the global sustainability transition, as well as the ambitions of both islands to further strengthen their positions as centres for sustainable finance.

CEOs need to think differently about leadership and AI talent

Channel Islands CEOs ranked the availability of key skills as the second highest threat to their organisations. The talent conundrum is a much bigger concern for Guernsey- and Jersey-based CEOs than the international competitors we compared them to, including the UK and UAE. Lack of availability of key skills is a near-term threat cited by 58% of local CEOs. With skills on their mind, one in three business leaders are also concerned if they have the right leadership team.

Your next move:

• Review your talent, skills and expertise needs across your leadership and business, in particular AI talent and future-focused leadership capabilities.
• Align your recruitment and resourcing model, redesign training and upskilling, performance management and your employee value proposition to these needs. It is not just about headcount – strategic workforce planning can also include managed services, offshoring, secondees and agentic AI.
• Get this right and we have a once-in-a-generation opportunity to attract talent through new ways of working, improve the quality and value of the work we do, make it more fulfilling and ultimately bolster the long-term competitiveness and prosperity of our islands.

AI adoption is patchy, with mixed results. CEOs need to scale implementation without comprising governance

Our survey last year found almost 60% of Channel Islands CEOs said they expected AI to boost returns in the future. However, many were integrating AI at a cautious pace, taking care to apply appropriate guardrails. One year on, this year’s survey looks at whether they are yet seeing results.

Financial returns from AI adoption to date clearly reflect a market still in transition in the Channel Islands. Only 8% of Channel Islands CEOs report both higher revenues and lower costs from AI, compared with 12% globally.

Question: What changes have you seen in financial returns due to AI adoption?
 

Some 58% of Channel Islands CEOs are concerned whether their companies are transforming fast enough to keep up with technology and AI, compared to a global average of 42%. And talent is a key challenge: only 15% of local CEOs agree or strongly agree that they can attract high-quality AI talent. That means 85% of companies are struggling to secure the right AI skills.

AI has so far been largely limited to back-office support services (such as finance, legal, human resources and tax) in the Channel Islands. For example, PwC Channel Islands Wealth Management Insights 2025 report found that non-client facing support staff are engaged in operations and compliance areas where automation and AI can take on much of the routine work.

In many cases, businesses have started using AI internally for support services as a first phase, prior to deployment for client-facing activities. This could also reflect the structure of the local market, where Channel Islands companies typically rely on off-the-shelf technology rather than in-house development.

PwC has identified seven foundational requirements for AI maturity and successful enterprise-wide deployment of AI. Our results show that whilst most local CEOs are confident that they have the company culture, tech environment, and risk processes in place that enable AI adoption, only four out of ten have a defined AI roadmap. This results in the majority (85%) failing to yet have in place the necessary foundations for successful AI deployment.

Question: To what extent do you agree or disagree with the following statements relating to AI use at your company?

Your next move:

• If you are one of the 59% of Channel Islands CEOs who do not yet have an AI roadmap, now is the time. You need to evolve a top-down enterprise-wide strategic approach.
• Your roadmap needs clear milestones, defined ownership, and governance frameworks. Without a roadmap, AI will remain a series of disconnected experiments rather than a source of lasting enterprise value.
• AI is only as good as the data it works with, and the greatest results are often where business priorities, evidence of AI’s value, and availability of talent and data align. Make sure your data governance structures are in place, leveraging formalised responsible AI and risk controls.
• After you identify the right high-value processes, aim for wholesale transformation. Instead of cutting a few steps, rethink the entire chain of events, which an AI-first approach may turn into a single step. That often starts by asking now how AI can fit into a workflow but how it can create a new one.

Innovation needs the right foundations to thrive

The overall innovation capability of a firm goes hand-in-hand with technology readiness when thinking about longer-term company viability. While 80% of Channel Islands CEOs agree to a moderate, large or very large extent that innovation is a critical component of their overall business strategy, we found that only 9% of them have enough of what we consider as innovation foundations in place.

To remedy this, 71% of local CEOs are actively working with external partners to accelerate innovation. We know collaboration is a strength of the Channel Islands, where proximity, support for start-ups, and clusters such as regtech-focussed companies work together. Still, there is further to go, including with overseas external partners, to stay relevant and avoid being left behind as sectors evolve.

Your next move:

• CEOs must prioritise innovation because that is where future growth will come from. This means leveraging partnerships, group-level R&D where available, and the islands’ connectivity to build innovation muscle and realise financial benefits.
• Senior leadership must champion this from the top, creating the culture and conditions for innovation to thrive.

CEOs need to make time now for longer-term priorities

Bold decisions about new markets, skills development, AI tools, innovation capability and cyber resilience are not possible without long-term thinking. How CEOs invest their time is one of the most important decisions they can make. Channel Islands CEOs spend only 7% of their time (around one-and-a-half days per month) on activities with a time horizon of five years of more. This is less than half the global average of 16%.

Our survey shows that Channel Islands CEOs spend 61% of their time focussed on activities associated with time horizons of less than a year, significantly higher than the global average (47%) and other comparator jurisdictions. This could reflect the ownership structures of surveyed Channel Islands businesses. For example, 40% of CEOs head up a subsidiary company - a position that is inherently more likely to be focussed on operational factors versus long-term strategic issues.

Your next move:

• It is oftens said that successful business leaders need both a microscope and a telescope to help them identify near-term threats while spotting long-term opportunities. To get both lenses in place, CEOs need to treat long-term reinvention as a standing priority, not a ‘nice-to-have’.
• In order to carve out more time for longer-term priorities, CEOs need to build a leadership team that absorbs short-term pressures, so they can focus beyond the immediate needs of their organisation.

These are unprecedented times and the stakes are high for Channel Islands CEOs. It is clear that businesses - and indeed our island economies as a whole - are vulnerable without enhanced action to stay ahead of technological disruption, local economic trends, and strengthened international competition.

We need to double down on actions to boost our islands’ competitiveness, working with businesses that are vested in the future of the islands. In the context of the ongoing future financial services strategy work on both islands, we call upon industry and government policymakers to work together as follows:

Building on progress to date, industry, government and regulators should prioritise key opportunities to deploy AI and capture addressable markets.

Focus on markets where we have credible expertise and the right to play, for example in application and servicing of tokenised assets, and improving high-friction KYC processes.

Move faster on AI as business leaders and as a jurisdiction. Strengthening board-level technology and AI knowledge will provide strategic direction and focus, to enable investment and governance.

Recognise and celebrate tech-led innovation on the islands, across all industries and sectors.

Continue to offer a supportive regulatory environment, including agile sandboxes that are attractive compared with those in peer jurisdictions.

Support catalysing initiatives for the good of the islands such as Impact Jersey and new business models such as social enterprises and public-private models.

Engage collaboratively as part of the family of UK financial centres to explore high growth markets, sectors andjurisdictions.

Ensure a continued focus on jurisdictional competitiveness, improving the business environment where feasible and supporting access to new markets.

AI talent, entrepreneurs and skilled workers are being lured to other jurisdictions through compelling value propositions.

Industry and government need to work together to compete for the best international talent, and to make sure our on-island training, upskilling and reskilling initiatives meet the needs of our future economy, and that the islands continue to be attractive places to live and work.