There has been a surge in confidence in the prospects for the economy among finance executives of the country’s biggest companies.
In 2012, only 11% of chief finance officers were positive about the outlook for the economy, whereas this year that figure has risen to 43%, according to a major survey by PwC.
Other findings in the 2013 Chief Finance Officers Survey include three-quarters of all finance executives expect revenue to grow this year, which is up from 59% for the same question last year, while 65% expect profits to grow compared with 55% last year.
In good news for the wider economy, 42% of those who responded said they are planning additional capital investment next year, (35% last year). Moreover, 47% of the finance executives expect growth in employee numbers, up from 35% last year and 59% expect to award pay increases compared to 38% last year.
Even though there was an increase in the numbers reporting that it was easier to access finance, the results show that this is an area that most companies still find very challenging. This year 20% said that finance is more easily available compared to 15% last year.
“The challenge for finance leaders is to look beyond the often quoted clichés of adding value to the business and to instead find new ways of orchestrating better performance. This includes sharing information with a more diverse set of stakeholders, enhancing resilience and providing a more connected and cohesive finance offering,” said, Paul Tuite, PwC advisory leader.
Other challenges are increasing difficulties in finding the right personnel to fill key roles. Respondents said that becoming more resilient was becoming a major focus for all corporates. “An overwhelming majority (90%) reported that another recession in the eurozone would have a negative impact on their business.
“A large majority reported that they would be unable to cope well should any of the following happen: a major fraud (83%), a cyber attack (67%), a major social unrest (66%) or a health crisis (58%). Larger organisations are now modelling the impact of radical shocks on their businesses to ensure they have the adaptive capacity to respond to crises, should they arise.”
“It is not surprising that uncertain economic growth (76%) is by far the greatest risk finance leaders plan to mitigate in the year ahead. Other risks being tackled are low cost competition (41%), security of the supply chain (32%), exchange rates (30%) and the increasing tax burden (27%).
Only a quarter (26%) plan to tackle the risks of fraud when a large majority acknowledge they would be unable cope well should this happen, said the report.
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