As 2025 draws to a close, business leaders across Australia and New Zealand are setting priorities for 2026 that reflect the economic environment they expect to navigate—one of modest growth, persistent uncertainty, and the need for operational excellence rather than simply riding favourable market conditions.

Cost efficiency ranks as the top priority for approximately 68% of businesses according to recent CEO surveys in both countries. This doesn’t necessarily mean aggressive cost-cutting, but rather continuous focus on productivity improvement, automation where appropriate, and eliminating unnecessary expenses.

The distinction matters because there’s a difference between defensive cost reduction and strategic efficiency improvement. Companies pursuing the latter are investing in systems and capabilities that will reduce costs sustainably while improving quality or responsiveness. Those simply cutting costs to preserve short-term margins risk damaging their competitive position.

Workforce optimisation appears as a priority for many organisations heading into 2026, though the specific focus varies by sector. Some industries still struggle with labour shortages and are prioritising retention and recruitment. Others have more balanced labour markets and are emphasising productivity through better training, tools, and processes.

Technology investment features prominently in 2026 plans despite overall caution about capital expenditure. However, the focus has shifted from technology for its own sake toward targeted investments with clear ROI. Cloud migration, cybersecurity, and process automation are common themes, while experimental or speculative technology projects face greater scrutiny.

Customer retention rather than acquisition is receiving increased emphasis heading into 2026. In many markets, it’s become more expensive to acquire new customers while retention strategies can generate growth from the existing base. This shift reflects both economic reality and maturation of customer relationship management thinking.

Supply chain resilience continues as a priority after the disruptions of 2020-2023 demonstrated vulnerabilities in many companies’ operations. Businesses are willing to accept modestly higher supply chain costs in exchange for greater reliability and reduced risk of disruption. This represents a philosophical shift from pure cost optimisation.

Sustainability and ESG considerations are becoming embedded in business strategy for many larger organisations, though SMEs often struggle to prioritise these issues when immediate operational challenges demand attention. The regulatory and stakeholder pressure around sustainability isn’t diminishing, so companies need to address it even during difficult economic conditions.

Diversification of revenue sources appears as a priority for businesses that became too dependent on single customers, markets, or products. The economic uncertainty makes concentration risk more apparent and motivates efforts to create more balanced and resilient revenue portfolios.

Cash flow management and working capital optimisation are receiving CEO-level attention at many companies heading into 2026. In an environment where capital is more expensive and harder to access, businesses are finding efficiency opportunities in receivables management, inventory optimisation, and payables strategies.

Digital transformation, that overused phrase, is being interpreted more practically in 2026 planning. Rather than grand transformation programs, many businesses are focusing on specific digital capabilities that address concrete problems—better customer data, improved internal communications, automated workflows in specific processes.

Merger and acquisition activity is expected to increase in 2026 after several quiet years. Companies with strong balance sheets see opportunities to acquire competitors or complementary businesses at reasonable valuations. Distressed M&A may also increase as businesses that struggled through 2025 seek exit options.

Risk management is receiving more systematic attention heading into 2026. Businesses are conducting scenario planning, stress testing their finances against various adverse conditions, and developing contingency plans. This reflects maturation of business thinking after the surprises of recent years.

Innovation hasn’t disappeared from business priorities but is being pursued more cautiously in 2026 planning. Companies are asking harder questions about innovation ROI and timeline to value. The appetite for long-term innovation bets with uncertain payoffs has diminished while interest in near-term innovation that addresses immediate customer needs remains strong.

Regulatory compliance and government relations are consuming more management attention as the regulatory burden increases across multiple domains. Companies are investing in compliance capabilities while also engaging more actively with policy processes that affect their operations.

International expansion plans are being reconsidered by many companies in light of economic uncertainty and geopolitical tension. Some businesses are pulling back from international markets to focus on domestic operations. Others view the current environment as creating opportunities to enter markets with less competition.

The trans-Tasman relationship specifically remains a priority for many businesses. Companies in both countries view the neighbouring market as a natural expansion opportunity or efficiency opportunity through scale. However, regulatory differences and economic divergence between the countries are creating new challenges.

Pricing strategy is receiving more attention heading into 2026 as companies navigate the tension between cost recovery and customer price resistance. The ability to implement price increases varied significantly across industries in 2025, and companies are getting more sophisticated about how they structure and communicate pricing.

Employee wellbeing and mental health have become embedded business priorities rather than temporary pandemic responses. Companies recognise that workforce stress and burnout create real productivity impacts and are investing in programs to address them, though measuring effectiveness remains challenging.

Succession planning is emerging as a priority for many organisations as leadership cohorts approach retirement. The combination of demographic change and difficulty attracting younger workers into some industries is creating genuine succession challenges that require long-term planning.

Cybersecurity specifically, beyond just general technology investment, ranks among top priorities for 2026. The increasing frequency and sophistication of cyber attacks combined with growing regulatory requirements around data protection is driving sustained investment in security capabilities.

Strategic partnerships and alliances are featuring more prominently in 2026 plans as companies recognise they can’t build all required capabilities internally. Collaborative approaches to technology development, market access, or operational capabilities allow businesses to achieve objectives they couldn’t pursue independently.

Looking at the overall pattern across business priorities for 2026, the picture is one of cautious, focused execution rather than bold aggressive growth. Companies are attending to fundamentals—efficiency, quality, customer relationships, risk management—while remaining opportunistic about growth where it can be pursued profitably.

This isn’t a recessionary mindset exactly, but it’s not the confident optimism that characterises boom periods either. Business leaders are planning for an extended period of modest conditions where success comes from operational excellence and strategic clarity rather than simply benefiting from favourable market winds.

What’s perhaps most striking about business priorities heading into 2026 is the convergence across companies and sectors. The specific tactics vary but the strategic themes are remarkably consistent—efficiency, resilience, selective investment, customer focus. This suggests businesses are responding to broadly similar environmental conditions and constraints.

Whether 2026 ultimately delivers the modest, challenging conditions that businesses are preparing for remains to be seen. Economic forecasting is imprecise and surprises occur regularly. But the collective business response to the current environment—cautious, focused, disciplined—represents a reasonable approach to navigating uncertainty regardless of how conditions ultimately evolve.