By Beatriz Marie D. Cruz, Reporter
MANY PHILIPPINE chief executive officers (CEOs) view artificial intelligence (AI) investments as crucial in navigating geopolitical and economic pressures this year, but they cite cost and legacy system upgrades as challenges, according to Ernst & Young (EY).
“CEOs see technology as one of the fastest ways to strengthen agility, improve competitiveness, and create more resilience in the face of uncertainty,” Noel P. Rabaja, deputy managing partner and strategy and transactions leader at SGV & Co., said in a forum last week.
In its 2026 Philippine CEO Outlook, SGV reported that 32% of Philippine CEOs ranked investing in AI and digital technologies as the most important action for navigating geopolitical and economic shifts.
However, 46% of CEOs said their AI initiatives are underperforming, with 28% citing difficulties in investing due to the rapid pace of technological change.
“Companies still lack sufficient network infrastructure, and their data is still very much non-digitized,” Mr. Rabaja told reporters on the sidelines of the forum.
He also highlighted gaps in companies’ upskilling efforts, while others struggle to transition from legacy systems.
“I think, for some companies, they find high costs of not just the technology itself, but changing their legacy system to be able to adapt the new technology or AI,” Mr. Rabaja said.
The report noted that 48% of Philippine CEOs expressed measured optimism about their business prospects for 2026, citing strong macroeconomic fundamentals despite weaker economic growth last year.
In 2025, the Philippine economy expanded by 4.4%, down from 5.7% in 2024, as the flood control scandal weighed on government spending and consumption.
“Leaders are feeling generally confident about their organizations and the local business environment,” Mr. Rabaja said.
Philippine CEOs, however, remain cautious about the global environment this year amid ongoing geopolitical tensions and trade disruptions.
EY also reported that 73% of Philippine CEOs are confident in their ability to optimize operations and enhance productivity, driven by continued digitalization and process improvements.
The survey showed that 64% of the country’s leaders are optimistic about revenue growth, even as 42% expect a rise in operating costs.
Leaders are pacing expansions carefully to balance governance requirements with market conditions, while facing pressures from input costs, cost pass-through limitations, and free cash flow constraints.
About 42% of CEOs accelerated a planned investment over the past 12 months due to geopolitical and trade policy developments.
EY added that 98% of CEOs reported adjustments to their strategic investment plans over the past year, with 40% delaying and 28% halting an investment.
The Philippines’ CEO Confidence Index declined to 59 in 2026 from 74 in 2025, reflecting a “steady but guarded sense of optimism.”
Compared with last year, CEOs showed lower confidence in price inflation (54); company growth (61); talent (60); technology transformation (60); organic transformation (63); portfolio transformation (55); and investment and technology (59).
The survey also noted that 75% of CEOs remain confident in their ability to improve employee engagement and retention.
“Philippine leaders are strengthening their foundations, accelerating AI adoption, and reshaping their portfolios to stay ahead of shifting economic and geopolitical currents,” Mr. Rabaja said.
SGV & Co. is a member of EY Global Ltd.
