LONDON — ESG is the area in which most communications investment is expected in 2024, while mastery of AI tools is the most important skill for the future, according to the new World PR Report 2023-2024 from the International Communications Consultancy Organisation (ICCO).

Produced annually, the industry umbrella body’s World PR Report is a survey of senior PR leaders and directors, providing insight on growth, investment, technology, ethics, mental health, diversity, measurement, and social media, with a breakdown by seven geographical regions. For this year’s report, 300 leaders were surveyed during August and September. The report also includes the PRovoke Media Global 250 ranking of PR agencies by fee income.

The change in attitudes to the potential impact of AI is noticeable in the ranking of top three technologies for the future, with 86% ranking AI in their top three, compared to 40% in 2022. Data science is pushed down to second at 41% (42% in 2022). The top skill for the future is ‘mastery of AI tools’ with 45% ranking this in their top three, a new option for this year rising above strategic consulting, 42%.

According to the report, the top application of new technology is ‘operating more efficiently’ at 55%, up from 40% and fourth rank in 2022. Building online communities is second with 47%, up from 44% and improved employee engagement is third with 38%, down from 41% in 2022.

ESG is the area where agencies expect the most investment (49%, up from 44% in 2022 and 32% in 2021), with influencer comms and strategic consulting completing the top three for the second year running. The top social issue clients are likely to prioritise is again sustainability and the environment (69% up from 62%). For the first time, this is the top social issue for clients in all seven regions.

The joint top ranked challenge is ‘economic conditions generally’, with 42% of PR leaders ranking it as a top three challenge alongside ‘clients unwilling to commit sufficient funds’, also 42%. Despite this, 96% of global PR organisations expect to grow in the five years.

Overall PR leaders’ perceptions of growth and profitability remain positive, with an average rating of 7.0 in agreement that the PR market will grow in 2024, down slightly from 7.3 last year. Leaders still agree that they expect an increase in the profitability of their organisations, with a rating of 6.2, although this is a dip from 7.0 in 2022.

Commenting on the economic backdrop to the report, Jeff Altheide, global managing director of independent agency network PROI said: “Short-term, economic conditions are leading some clients to reward any ideas and programs that can move sales. Several focus group agencies reported their budgets have increased in retail and integrated marketing programs. And, some are adapting their new business approach accordingly”

The report includes analysis of each region (UK, Eastern Europe, Western Europe, Africa, Middle East, Asia Pacific, North America, and South America) as well as the specific topics of talent, measurement and evaluation, diversity and inclusion, and ethics).

Commenting on talent, Reuben Sinclair MD Rohan Shah said: “The paramount talent challenge, as highlighted by 60% of PR agency leaders, revolves around retaining key talent. This underscores the pivotal role experienced professionals play in the industry.”

On DEI, Mars Petcare’s global people, inclusion and diversity communications lead Ishtar Schneider, , said: “It’s promising to see that geographies that have the most work to do around to reflect the communities around them, are putting relevant policies in place. But the best policy is only words on a page without the appropriate and ongoing measurement, reporting and governance to enact change”.

Of the findings around measurement and evaluation, Carma co-managing partner Richard Bagnall said: “Metrics are being put to work across the board: 82% for reporting, more than half for planning, and a good chunk for justifying fees and making decisions. It’s a sign that we’re trying to get savvier with our numbers, using them to steer the ship rather than just chart the course”.

On ethics, ICCO ethics chair and founder of Netprofile Christina Forsgaard said: “It’s heartening to see that 78% of PR agencies have opted to decline certain client offers or projects. This bold stance is a clear testament to the real-world impact of ethical considerations within the industry’s operations.”

Summing up the findings, ICCO executive director Rob Morbin said: “This year’s report is a steadfast reminder of our industry’s ability to grow, adapt, and invest, in the face of an ever-transforming business environment. We are embracing new technologies, skill requirements and a necessity for improved employee welfare, diversity, equality, and ethics. All this against a backdrop of pervasive geopolitical crises and economic uncertainty.

“Grappling with AI, misinformation, and climate, all while nurturing creative and talented teams, is no mean feat. Yet with these challenges come opportunities to have a colossal impact for good, and I have no doubt our industry will continue to evolve and flourish, as we have done countless times before”.