What concerns CFOs going forward

A chief financial officer (CFO) bears an incredible weight within an organization as someone who tracks cash flow and plans for future investments. As a result, CFOs can give a real insight into the future of work for both employees and leaders.

Business administration company Globalization Partners spoke to 260 CFOs, senior financial leaders, and corporate executives in an effort to understand their concerns. All of those surveyed worked within organizations that have more than $100 million (USD) in annual revenue. Two out of five of those surveyed worked within companies that have more than $1 billion in revenue.

Despite fears of a recession, the survey found plans for expansion and a focus on employee experience.

CFO concerns in 2022

The rising cost of living has become a worry for the majority of CFOs. In fact, 72% are unsure whether wages can rise at a rate that keeps the company competitive.

Discussing this point, Simone Nardi, CFO at Globalization Partners, commented: “Increasing inflation can generate a reduction in spending, which puts pressure on the growth and volume of a business.

“Inflation can also increase operating costs by generating inflationary pressures on salary, cost of goods, and cost of services needed to operate a business.”

Concerns about costs are amplified by the fact that 88% of respondents believe that the ‘Great Resignation‘ and retaining employees is a top concern for stakeholders in their organizations as often this requires money.

Fears around employee retention play into human capital management (HCM). This is an area of increasing importance to CFOs with 83% believing that elements like payroll and international people management will become issues for businesses.

Of course, issues are not stagnant and there are always rumblings on the horizon. Notably, 88% of respondents were fearful of an incoming recession.

For those who want to retain talent but are worried about the future, it is essential to communicate with staff. Rather than lose employees who are concerned by a lack of updates about the health of the company, talk as openly as possible.

Offering advice on how to handle economic uncertainty, Bert Bean, CEO of Insight Global, noted: “As we’re seeing in the headlines, even major companies that have experienced astronomical growth over the last several years are not immune to financial challenges.

“If a recession strikes, I’d hate to see that result in more layoffs. If your company hasn’t established a recession plan yet, do it now, communicate it with your employees, and start acting on it.”

Growth in adversity

Despite anxiety about the future, a significant amount of financial leaders aren’t letting fear hinder their ambition. 83% have long-term growth plans that include international expansion.

Increasing a business’ global presence requires a variety of hires and although there are fears around climbing wages, 29% are prioritizing hiring talent to help reach their business goals in the next 12-18 months.

While money can be a solution for attracting and keeping talent, adopting a positive company culture, and giving employees flexibility can be cheaper ways of improving retention.

92% of respondents acknowledged that a remote-first work policy helps improve retention and talent acquisition. On top of that, 90% believe that remote-first policies improve inclusivity because it gives staff equal access to career opportunities and circumnavigates proximity bias.

Giving equal opportunity can also help a business’s profits. 87% of CFOs believe diversity, equity, and inclusion (D,E&I) can help a company’s bottom line.

Fortunately, 52% of CFOs are taking action on these benefits and are focused on remote hiring that is not restricted to borders.

There is an opportunity for businesses to offer packages that attract top talent without finding an endless stream of money. Undoubtedly, if a recession does arrive or the cost of living continues to rise, businesses will increasingly turn to non-monetary benefits.

Nardi noted: “We understand where people are with their uncertainty and how they tend to return to their comfort zone, but, we think there’s an opportunity to expand in a smart way.”

Finding and honing that “smart way” will be the challenge for CFOs and senior leaders across the board going forward.

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