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Headlines CEO Survey Measures Confidence Despite the debacles of Enron, WorldCom, and others, almost 75 percent of CEOs say they still have high confi- dence in the accuracy of results provided by external auditors. That number comes from a new survey of 130 chief executives from some of the nation's 1,000 largest firms con- their own firms' prospects in the coming year, few feel confidence in the nation's energy, communica- tions, and healthcare industries. Jeffrey Sonnenfeld, associate dean son College and the Kauffman Cen- ter for Entrepreneurship, disclosed these and other trends. The GEM report predicts that ducted by The Gallup Organization and the Yale School of Management, New Haven, Connecticut. The CEO survey additionally measures an array of governance and leadership issues such as CEOs' confidence in their own businesses, people, and acquisi- tions; confidence in the national economic system; and confidence in national defense. The survey found that those of the Yale School of Management commented, "The motives of the once admired and now widely dis- credited 'serial acquirers' are revealed in this survey. Rather than being driven by business opportunities or superior strate- gic vision, the CEOs who build through acquisitions in- stead of invest- ment in their current businesses seem to be driven by hubris. It is also stunning to see how many CEOs lack confidence in their boards, financial reporting, and even their own management teams. This seems to be an era for many CEOs to rethink their reliance upon their immediate associates." Entrepreneurs Back Off CEOs who fail to invest in their ex- isting infrastructure in favor of fre- quent acquisitions tend to be more likely to feel that great leaders are born that way. However, most CEOs believe that great leadership is devel- oped over time. The survey also showed that as many as a quarter of the polled top executives do not feel that their boards understand the firms they are overseeing. In addition, the CEOs stated that they trust the integrity more than the competence of their own top management. Also, these CEOs are twice as likely to be plan- ning major investments in their staffing than in their technology in the coming year. While confident in 8 BizEd SEPTEMBER/OCTOBER 2002 The economic recession and lingering effects of the dot-com crash have made po- tential entrepreneurs wary of starting new ventures. In fact, entrepreneur- ial activity in the U.S. plunged 30 percent last year, to 11.7 percent of adults who are involved in a busi- ness less than four years old. Entrepreneurship is expected to make a strong comeback later in the year, although only one in three adults believe that good op- portunities will develop over the next six months. "Global Entrepre- neurship Monitor 2002 National Entrepreneurship Assessment for the United States of America," a recent study conducted by Bab- other companies backed by venture capital will close their doors soon as some of the younger, less successful venture capital firms shut down, and established companies choose not to invest in seed-stage companies. De- spite the bleakness of this picture, the report does offer good news, noting that informal angel investing amounted to $129.2 billion last year. Other positive signs also bode well for the recovery of entrepre- neurial activity, including the high percentage of older entrepreneurs with deep industry experience and more personal capital; the high ratio of women involved in entrepreneur- ial activities; a generally positive atti- tude toward the government and its regulations; and business training that fosters personal initiative and explicitly teaches entrepreneurship. More informa- tion is available on the Kauffman Center's Web site at www.entre world.org.