This site uses cookies to provide you with a more responsive and personalized service. By using this site you agree to our use of cookies. Please read our cookie notice for more information on the cookies we use and how to delete or block them.

Bookmark Email Print this page

Deloitte CFO Signals™: Economic, Political Worries Depress Large Company CFOs’ Expectations for Earnings, Investment, Hiring

NEW YORK, Sept. 26, 2012 – Persistent economic troubles at home and abroad, combined with uncertainty around elections and the U.S. fiscal cliff, yielded the most somber year-over-year expectations in the 10-quarter history of Deloitte’s CFO Signals survey. On the heels of their new survey lows for both sales and earnings growth expectations, chief financial officers are tempering both their capital investment and hiring expectations as well.

The quarterly survey, which tracks the thinking and actions of CFOs representing North American companies averaging more than $5 billion in annual revenue, found that 40 percent of CFOs report rising pessimism this quarter about their companies’ prospects (up from 28 percent last quarter). The outlook in the U.S. is worse with 47 percent of CFOs less optimistic.

Corporate performance expectations reflect those concerns. For example, CFO expectations for year-over-year sales growth (4.8 percent* versus 6.6 percent* last quarter), earnings growth (8.0 percent* this quarter versus 10.5 percent* last quarter) and capital investment (4.7 percent* versus 11.4 percent*) all took hits this quarter. In addition, projections for domestic hiring plummeted to 0.6 from 2.1 percent last quarter. The figures are survey lows in each case.

“We are clearly witnessing a very tough environment for business – even for many of the largest and most successful companies in the world,” said Sanford Cockrell III, national managing partner, CFO Program, Deloitte LLP. “When you take global economic conditions that are already difficult and then add in the uncertainty that comes with elections and a fiscal cliff in the U.S., it is easy to see why CFOs’ expectations would become more conservative.”

The concerns about the global economy that have been high in recent surveys only escalated this quarter. When asked about their most worrisome risk overall, for example, nearly 60 percent of CFOs mentioned domestic or global economic conditions, with one third of those specifically citing European conditions. And many CFOs believe global economic malaise has already negatively impacted their home economies, with more than 80 percent of U.S. CFOs saying their domestic economy is either stalling or about to stall and about 65 percent of Canadian and Mexican CFOs echoing the same sentiment.

Looking beyond the elections and fiscal cliff, companies appear to face substantial challenges to maintaining their recent strong performance.

“For the last several quarters, companies have been able to bolster their earnings through better focus, scaling back in lower margin business and getting more efficient,” said Greg Dickinson, who leads the Deloitte CFO Signals survey. “But it may be the case that the returns on these efforts are diminishing and companies are running out of ways to outperform their underlying economies.”

Additional findings from the Deloitte CFO Signals survey include: (estimates are adjusted averages to reduce the effect of outliers):

  • About one-quarter of CFOs cite government- and regulation-related issues as their most worrisome risk, with frequent mention of the impending fiscal cliff, possible changes to tax and regulatory policy and the potential impact of U.S. elections on policy and equity markets.
  • In response to continuing concerns about Europe, about two-thirds of CFOs say they have been working to reduce their exposure to the continent, with the most common changes involving cash levels, treasury/FX approaches and banking relationships.
  • CFOs continue to express little direct response to the “fiscal cliff” of pending tax increases and spending cuts. But even though 58 percent of companies are not taking any steps in response, a growing proportion appear to be delaying both investment and hiring.
  • There has been little retreat from health care due to health-care reform. Just two percent of companies are considering limiting coverage to the legal minimum and none are considering dropping employer-sponsored coverage altogether.
  • CFOs say their companies’ top three challenges are revenue growth from existing markets (58 percent, about the same as last quarter), framing and/or adapting strategy (41 percent, up from 30 percent) and talent (34 percent, down from 41 percent).
  • Executive teams struggle most with decisions related to strategy and growth, according to the CFOs surveyed. The barriers most cited include differing views of strategies and goals, biases of executives and insufficient understanding of options and outcomes.
  • CFOs offered a mixed assessment of IT capabilities. About two-thirds say their IT approaches ensure information security and facilitate compliance and reporting and half are positive about having the information they need. But nearly half also say their IT systems do not adapt well to changes in strategy, operations and/or scale.

To download a copy of the survey, please visit our CFO Signals section of

*All numbers with an asterisk are averages that have been adjusted to eliminate the effects of stark outliers.

About The Deloitte CFO SignalsTM survey

The Deloitte CFO Signals survey was conducted for the third quarter of 2012. More than 80 percent of the 85 CFO respondents were from companies with more than $1 billion in annual revenues and three fourths were from publicly traded companies.

Each quarterly CFO Signals report analyzes CFOs’ opinions in five areas:  CFO career, finance organization, company, industry and economy. For more information about Deloitte’s CFO Signals, or to participate in the survey, please contact

About Deloitte’s CFO Program

Deloitte’s U.S. CFO Program supports the organization’s vision “to be recognized as the pre-eminent advisor to the CFO.” It harnesses the breadth of Deloitte’s capabilities to deliver forward-thinking perspectives and fresh insights to help CFOs manage the complexities of their role, tackle their company’s most compelling challenges and adapt to the changing strategic shifts in the market. For more information about Deloitte’s CFO Program, please contact or visit

As used in this document, “Deloitte” means Deloitte LLP and its subsidiaries. Please see for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

Last Updated: 


Tourang Nazari
Deloitte Services LP
Job Title:
Public Relations Manager
+1 703 251 1681
David Chambers
H+K Strategies
Job Title:
Public Relations
+1 212 885 0681

Related links

  • CFO SignalsTM
    What North America’s CFOs are thinking – and doing.
  • CFO SignalsTM: 2012 Q3 results
    Economic and political worries depress large company CFOs’ expectations for earnings, investment, and hiring.
  • CFO Center
    A CFO's varied roles make the job more complex than ever.
  • CFO Journal
    An online publication from The Wall Street Journal, featuring a regular stream of CFO-centric content, including insights and analysis from Deloitte.
  • Subscribe to CFO Insights
    Dedicated to addressing the issues that CFOs and finance executives face today.

Share this page

Email this Send to LinkedIn Send to Facebook Tweet this More sharing options

Stay connected