The proportion of UK finance chiefs supporting the country’s stay in the EU has fallen, and many are approaching the new year with a great deal of caution.
According to professional services firm Deloitte’s most recent chief financial officer (CFO) survey, less than two-thirds (62 per cent) said they were in favour of the UK remaining in the EU, down from almost three-quarters (74 per cent) six months ago.
“A clear majority of CFOs continue to favour the UK remaining in the EU, but the proportion of those expressing unqualified support has fallen,” said David Sproul, senior partner and chief executive of Deloitte. “This mirrors what we have seen from the broader public in opinion polls in the last six months.
“With around one third of CFOs undecided on their position or awaiting the outcome of renegotiation discussions, the eventual deal may well significantly affect business attitudes to EU membership.”
The study also found that finance chiefs’ confidence had taken a knock. Cost reduction ranked as the top priority for the first time in 12 months, with 44 per cent citing this as a strong priority, up from 34 per cent the last time the question was asked three months ago.
Meanwhile, 37 per cent said that increasing cash flow was important, up from 34 per cent three months ago.
On the other hand, strategies focusing on expansion had fallen out of favour, with 19 per cent believing that expanding through acquisitions was a strong priority, down from 22 per cent, and 17 per cent saying that raising capital expenditure was of great importance, down from 19 per cent.
“The surge in business confidence that started in late 2012 went into reverse in 2015,” said Ian Stewart, chief economist at Deloitte. “CFOs are reacting to uncertainties abroad by cutting back on risk taking and sharpening their focus on cost reduction.
“The more defensive stance by CFOs points to a softening in the growth of corporate hiring and capital spending in coming months.”