Research by EY Scotland and Livingston James has revealed public sector companies are far quicker to utilise AI in business than private and third sector firms.
The data forms part of a new report, Investigating the Future CEO, for which more than 200 c-suite executives in Scotland were interviewed across public, private and third sectors.
Key findings include:
- 71% of organisations are regularly discussing AI at board level, but only 36% actually have a strategy in place
- Public sector are ahead of the private and third sectors in terms of adoption in Scotland
- Lack of clarity over who should lead AI initiatives could be contributing to lack of strategy
- However, despite the rise of AI, challenges around people are what keep Scotland’s CEOs ‘awake at night’
It examines how the modern CEO is judged not only on what they deliver, but how they deliver it, navigating a rapidly changing world dictated by technological advancement, talent shortages, economic uncertainty, shifting stakeholder expectations, and heightened demands for trust, transparency and sustainability.
Despite the rapid rise of automation and AI, one theme remains constant: People (not processes) are dominating the CEO agenda.
Attracting, retaining and developing talent continues to be one of the most pressing challenges for CEOs. In today’s volatile market, people risk is strategic risk; culture, capability and inclusion now sit alongside cash flow and technology as critical drivers of organisational resilience.
AI Readiness: Awareness Is High, Action Is Lagging
This year’s report places particular focus on AI governance and capability at board level. While AI has firmly entered the boardroom conversation, strategic maturity remains under‑developed:
- 71% of organisations regularly discuss AI at board level
- Only 36% have a formal AI strategy
- 8% do not have a designated AI owner, signalling gaps in planning and accountability
The findings highlight a clear shift: technology is no longer an enabler, it is the battlefield.
What’s Keeping CEOs Awake at Night?
CEOs identified three dominant challenges when executing strategy:
- Clarifying and communicating a compelling vision
- Access to experienced, capable leadership and resources
- Winning hearts and minds to maintain momentum through change
These concerns reinforce the importance of human‑centred leadership during complex organisational transformation.
Priorities for the Year Ahead
Leaders across all functions consistently pointed to a shift in priorities:
- Customer Value Proposition (CVP) remains the number 1 strategic priority
- Shareholder value is close behind
- Employee Value Proposition (EVP), while still critical, has dipped slightly compared to last year’s report
- Environmental impact and D&I remain important, though sentiment is evolving from awareness to accountability
The Attributes Defining the Future CEO
The leadership traits that will define the Future CEO are shifting. This year’s report highlights:
- Vision & determination topped the list—overtaking resilience
- High EQ continues to rise in importance amid hybrid working and stakeholder complexity
- Courage to lead, especially in the context of AI and transformation, is increasingly essential
- Resilience remains the baseline expectation
- Adaptability, transparency and humility complete the profile
The result is a CEO archetype who blends strategic clarity, emotional intelligence, ethical decision‑making and the ability to lead through disruption.
Succession: Confidence High, Pathways Low
Survey findings also highlight a significant leadership development gap:
- 75% of CEOs believe their successor is already within their senior leadership team
- 80% of functional leaders believe they have the potential to become a CEO
- Only 29% of functional leaders are part of a formal succession plan
- 70% of functional leaders say pathways to the CEO role in their organisation are inadequate
This year’s report adds a new Development Section, outlining the strengths and development needs of leaders from Commercial, Operational, Finance, Technology and HR backgrounds, including what each group requires to transition successfully into the CEO role.
The full report is available here.