Appetite for risk: UK business confidence rebounds

April 2026  |  FEATURE | BOARDROOM INTELLIGENCE

Financier Worldwide Magazine

April 2026 Issue

Like many countries across the globe, the UK has experienced a period of prolonged economic volatility – a landscape in which business confidence has been muted and the appetite for risk subdued. Over recent months, however, confidence has begun to return. A sense of optimism about future growth is now evident among business leaders.

According to research by ECI Partners, 47 percent of respondents stated that they now have a higher appetite for risk compared with a year ago, while 26 percent reported that their appetite has fallen. A further 27 percent indicated no change. The study suggests that confidence increases with company size, with 57 percent of UK businesses employing more than 500 people indicating that they are more open to risk than last year. Appetite for risk also varies from sector to sector.

“Technology businesses are the most confident, with 58 percent reporting a higher appetite for risk, followed by human resources companies at 57 percent,” says Tom Wrenn, managing partner at ECI Partners. “In contrast, perhaps owing to the increased burden of national insurance and business rate changes, only 31 percent of retail sector companies said they have a higher appetite for risk.”

Growth drivers

Confidence among UK business leaders is being channelled into growth plans. More than 81 percent of surveyed companies are considering international expansion as a driver, including 86 percent of large firms, 84 percent of medium-sized businesses and 75 percent of smaller organisations.

Among companies exploring overseas growth, private equity (PE) and venture capital are the preferred sources of funding, cited by 35 percent of respondents and ranking above government grants and bank financing. Medium-sized companies (40 percent) were found to be the most likely to consider PE for international expansion, compared with approximately a third of large companies and just under a third of smaller firms.

Sector differences are also notable. Organisations within the creative industries were the most likely to consider PE for overseas growth, followed by those in travel and financial services. Survey participants highlighted sector expertise, technology and artificial intelligence (AI) capability, international reach and access to talent as advantages of working with PE partners.

“The number of management teams actively considering PE is striking, as they look to expand internationally and navigate the shifting sands of AI,” observes Mr Wrenn. “Founders and chief executives are looking for experience and expertise from their business partners to navigate the growth opportunities the likes of generative AI affords.”

Support for this assessment comes from Deloitte’s latest ‘UK CFO Survey’ report, which notes that 59 percent of chief financial officers are more optimistic about AI’s ability to boost performance, up from 39 percent a year earlier. The same survey indicates that 96 percent expect investment in digital technology to rise over the next five years and 77 percent anticipate improvements in productivity and business performance.

“Improved business confidence encourages executive leaders to take a more proactive approach to growth, particularly through increased investment in digital transformation,” points out Sebastien Marchon, chief executive of Rydoo. “For many organisations, this reflects a recognition that technology, particularly AI, can unlock productivity gains that drive growth.”

Despite this optimism, challenges remain. Rising costs continue to be an impediment to growth, with education, manufacturing and technology leaders expressing concern. A third of respondents to the ECI survey cited rising costs as the single most significant barrier to progress. The pace of digital transformation is also an issue for many organisations. The survey highlights that healthcare companies view digital transformation as a notable challenge, while media and marketing companies appear less concerned.

Confidence and ambition

Despite the backdrop, most UK business leaders remain confident about the year ahead for their organisations. The process of navigating uncertainty has become the new normal, and businesses are prepared to adopt measured risk in pursuit of long term resilience.

“We believe the UK continues to be a good environment for entrepreneurs to grow their businesses and confidence is translating into ambition,” asserts Mr Wrenn. “There was uncertainty before the latest Budget, but over the last 12 months the UK is only behind North America in gross domestic product growth and the business environment is positive, with a thriving digital economy and levels of company formation.”

At the same time, concerns about rising costs underscore the need for disciplined investment strategies. As Mr Marchon cautions, investment in technology does not automatically lead to performance gains unless it is deployed in a considered and managed way.

“Productivity gains depend on choosing the right tools at the right time,” he says. “This means integrating them into existing workflows without disrupting day to day operations, as poorly implemented technology can become an additional cost rather than a catalyst for growth.”

Overall, the UK business landscape appears to be entering a phase of cautious renewal. While risks remain, there is evidence that organisations are willing to embrace change, explore technologies and pursue opportunities on the global stage. With investment strategies and a focus on innovation, UK businesses may be positioned to build on this sense of confidence in the year ahead.

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BY

Fraser Tennant