In Australia, the top three most important technologies Australian respondents are concerned with when considering their digital transformation strategy are cloud computing, artificial intelligence, and cyber security. In terms of the benefits Australian companies are receiving, these include cost reduction, increased data storage space and increased security.

The eighth annual report also revealed that the M&A market would continue to boom. Europe saw the most M&A interest in 2021, with over US$8.4 billion worth of completed Chinese deals. Asia and North America were second and third, with US$5.4 billion and US$4.7 billion. M&A in Latin America reached US$3 billion in 2021, while acquisitions in Oceania and Africa totalled approximately US$1.5 billion.

Jannan Crozier, global chair of the firm’s global M&A practice group, said that the decline in M&A has been especially acute and strict pandemic measures, particularly in China, have further weighed on outbound deal-making in 2020 and 2021, contrasting with a strong recovery in global cross-border M&A during the same period.

“M&A is back with a boom: according to Refinitiv, global M&A hit US$5.9 trillion last year, representing an impressive jump of 71 per cent as compared with 2020 levels. These figures are underpinned by record deal-making in the technology sector, which alone reached US$1.1 trillion in 2021.

“Chinese OFDI aligned with this global trend and displayed a slight uptick in growth, totalling US$138 billion in 2021, compared to US$134 billion in 2020 and US$117 billion in 2019. Yet with increased foreign investment scrutiny from overseas regulators, particularly in the technology sector, many Chinese companies are also pursuing domestic options,” she said.

“Additionally, while Chinese OFDI to Europe, North America and Asia has not come close to its 2017 peak, it will be interesting to see how other markets such as Oceania, Africa and Latin America are shaped by Chinese investment in 2022, and how this will in turn influence Asia-Pacific domestic investment flows. What is certain, however, is that we can expect a dynamic and exciting year for both Chinese and global M&A activity.”

Whilst 81 per cent of Australian respondents said that COVID wasn’t a factor in their digital transformation – and that they had pre-existing plans, 96 per cent said they improved their cyber security and IT in response to COVID. This was a trend for many companies across the globe, according to Florian Tannen, Munich-based IT, privacy and outsourcing partner.

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“The pandemic situation forced organisations to digitalise at a very rapid speed and for digital meetings. This has brought new solutions and tools, but also a new way in which people access networks of organization (mostly remote and outside the secure ‘fence’ within the organizations’ premises),” he said.

“This calls for additional cybersecurity and tools and processes to safeguard such new ‘flanks’. However, such changes to work and collaboration increase the risk of loss of data, data breaches and cyberattacks.”

Moreover, according to the report, organisations should place an increased focus on governance whilst making key investments; but legal and sourcing teams may find themselves left out of important governance decisions and conversations.

Therefore, businesses will need to ensure that all relevant stakeholders are involved in such governance matters, said Sydney-based Anne-Marie Allgrove, global head of intellectual property, data and technology at Baker McKenzie. In fact, 96 per cent of Australian respondents in the report said they face regulatory restrictions in implementing cloud-based solutions.

“Good data governance requires an understanding of the data, data flows and each party’s role in relation to the data, followed by a legal and operational risk assessment as to the importance of the data and what rights are needed to enable a business to be able to extract the full value of the data so as to ensure in any negotiations the parties are clear as to what they need in respect of rights in the data,” she said.

“A key aspect of data governance is putting in place robust contract terms that regulate the handling of that data, effectively spelling out each party’s rights and obligations with respect to the data. Clear contract drafting is essential to achieve the best outcomes.”