CFO Sentiment Report | Edition 20
Confidence up, uncertainty down
Clarity brings confidence. After a rocky start to the year, Australian CFOs are feeling positive once more, encouraged by reduced uncertainty and improved economic conditions.
The risk appetite and profit expectations of Australia’s Chief Financial Officers (CFOs) are growing, supported by uncertainty plummeting to pre-pandemic levels and renewed business optimism against the backdrop of a more stable geopolitical and economic outlook.
However, some tail risks are lingering. Many CFOs are keeping a watchful eye on inflation, and most believe that the inability to execute strategies will pose a significant risk over the next 12 months.
Elsewhere, Artificial intelligence (AI) adoption is continuing to grow within the finance function and across the organisation and is expected to help CFOs meet their business objectives.
Key takeaways
- Net optimism in own business prospects has improved to 63% – up 14 percentage points from H1 2025 – while the net uncertainty rating has fallen sharply to a seven-year low of 66%.
- Confidence in the economy has held steady and remains firmly in positive territory at 22% while CFO risk appetite has risen by 13 percentage points to 39%.
- The outlook for profit has strengthened, with 46% of CFOs expecting margin improvement over the next 12 months.
- 93% of organisations are now utilising AI compared to 67% just one year ago – with almost all CFOs believing that it will create value across all business functions.
Explore highlights from this edition below, and download the full report for detailed insights and analysis.
While CFOs’ confidence in their own company is rising, their optimism about the Australian economy has remained steady. Net optimism sits at 22% – broadly in line with the last edition.
Although sentiment about the economy hasn’t improved, it remains in positive territory and close to its highest level since CFOs were first asked this question in H2 2022.
Net uncertainty has fallen sharply over the past six months. It now sits at 66% – down 26 percentage points on the last edition – its lowest level for seven years. This has supported an increase in risk appetite, which has risen by 13 percentage points to 39%. But risk appetite remains below pre-COVID levels, suggesting that while CFOs feel more certain about the business environment, this has not yet fully translated into increased risk taking. The risks of most concern to CFOs have not changed significantly over the past six months, with the inability to execute strategies remaining the top risk (57%).
Delivering on efficiency targets involves more than simple budget cuts, and CFOs are implementing a range of cost management practices to meet their targets. The leading strategy involves re-engineering business processes, selected by two-thirds of CFOs. This structural change links closely with digital adoption, with CFOs identifying a range of technological tools that are also helping them optimise their operations. Almost half (49%) of respondents use AI to automate tasks and reduce costs, and 42% use cloud-based solutions to optimise spending.
AI adoption continues to grow. Most firms have now integrated AI into both their organisation (93%) and their finance function (75%), with maturity progressing steadily over the past two years. CFOs view AI as a driver of value across their business. Across all areas identified, at least 90% of CFOs are expecting an improvement in enterprise value. This shows a broad organisational belief that AI will play a meaningful role in enhancing business practices.
