The latest KPMG Enterprise Barometer reveals a positive outlook among Ireland's indigenous businesses, with over a third planning workforce expansion. These entrepreneurial firms prioritise sustainability but seek clarity on costs and benefits, says Alan Bromell
KPMG Enterprise Barometer 2023 highlights confidence among Ireland’s indigenous businesses, with over half (55 percent) expecting to increase turnover in the next 12 months.
The majority of survey respondents, 83 percent, support the need for more action on climate change, and 7 out of 10 are actively pursuing sustainable measures, demonstrating the proactive approach these entrepreneurial businesses are taking to incorporate environmentally friendly practices into their operations.
The research reveals overall optimism among Irish businesses, with over half (55 percent) expecting to increase turnover in the next 12 months and 38 percent expecting to expand their workforce, demonstrating a belief in their growth potential and job creation.
Balancing the costs and benefits of sustainability
While the majority of survey respondents support more action on climate change, two-thirds express concern about the need for more clarity on the costs and benefits of these measures, and three-quarters say no stakeholder groups are exerting pressure on them to develop decarbonisation strategies.
This poses a significant challenge for companies as they strive to make informed decisions on sustainability measures and allocate resources effectively.
The survey showed resilience and measured confidence in the future amongst Irish businesses and entrepreneurs.
Notwithstanding the challenges in areas such as costs and interest rates, Irish entrepreneurs are resourceful and robust. Private Irish business and entrepreneurship are critical pillars of the Irish economy, providing employment, sustaining tax revenues and acting as role models for future entrepreneurs.
In addition, their ingenuity and innovation can be instrumental in solving various challenges, from technology, health and nutrition to sustainability and environmental protection.
The survey also shows that sustainability has become a fundamental aspect of business operations, and it’s encouraging to see businesses in Ireland actively pursuing sustainability measures. However, they need help understanding the costs and benefits of decarbonisation.
Tax suggestions for Budget 2024
When asked for their views on the current tax regime, less than a quarter (24 percent) said they believe it encourages entrepreneurship and growth. At the same time, three-quarters feel that the Irish tax regime is more challenging for domestic businesses.
The top three tax changes businesses would like to see in Budget 2024 are introducing tax measures to encourage sustainable behaviour (83 percent), amending capital gains tax rates or rules to encourage investment in Irish companies (79 percent) and introducing a reduced tax rate for dividends for entrepreneurs (74 percent ).
These highlight a desire for tax incentives and reforms that promote sustainable business practices, stimulate investment and reward entrepreneurship.
Recruiting challenges
Sixty percent of private Irish businesses and entrepreneurs face difficulties recruiting the right individuals to fill key company positions.
Nearly half (45 percent) consider the current tax regime in Ireland a disadvantage to recruiting and retaining skilled employees.
The availability of residential accommodation is another primary concern; over three-quarters (77 percent) say lack of accommodation is an issue, suggesting that the housing situation in Ireland could impact recruitment and competitiveness.
Alan Bromell is Head of Private Enterprise at KPMG
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