The number of board members who are “confident” their organisations are able to manage through the current period of economic uncertainty has fallen year on year, according to new research.

Confidence with economic uncertainty has dropped from 42% to 35% this year. Even fewer board members are optimistic their leadership can manage through the geopolitical uncertainty currently afflicting the world with only 26%, believing in their organisations’ ability to manage the disruption.

The news comes as part of the latest CEO and Board Confidence Monitor from Heidrick & Struggles, the international headhunting firm.

The search firm says the need for organisations to manage across “intransigent divides” on the current political landscape has gained more emphasis.

Jenni Hibbert, Heidrick’s leader in Europe & Africa, says: “Organisations’ ability to work effectively across divides is more important than ever in today’s polarised geopolitical climate.

“What leaders are learning may eventually build confidence on this difficult area of concern.”

Trump’s offensive

The geopolitical terrain has changed dramatically since Donald Trump took over at the White House. In his short time in the presidency, Trump initiated and suspended brutal tariffs on Mexican and Canadian products, threatened tariff action against the EU and launched a campaign against diversity and inclusion.

When the Bank of England cut interest rates this week, the Monetary Policy Committee noted in its minutes that US tariff announcements were connected to an “increase in economic uncertainty globally and a pickup in financial market volatility”.

There is some good news. Confidence in managing “market dynamics” has climbed over the past 12 months from 39% to 41%.

This year, board members say economic uncertainty, or volatility, is their top concern, just as it was last year, with geopolitical uncertainty coming in second.

However, the third most significant concern was workforce recruitment and retention. That has been replaced with concern about market dynamics.

Confidence in being able to attract employees has grown, along with being able to manage cybersecurity risk and build a “healthy organisational culture”.

Strategies survive

Despite worries about specific issues, two-thirds of leaders say they remain confident in being able to deliver on their 2025 strategic plan.

Hibbert says: “Over time we have seen leaders’ confidence grow in their companies’ ability to manage complex issues like cybersecurity and climate change, despite these issues first emerging as sources of major concern and confusion.

“Moving from uncertainty to confidence is important when a lack of knowledge contributes to highly divergent opinions on how to act.”

One worry for boards is the low level of confidence in executive pipelines. Heidrick’s report says: “In this context, it’s good news that 52% of CEOs and directors said their company is increasing its investment in CEO and board succession planning in a survey we conducted earlier this year.”