Risk Management Soars Past Revenue Growth as Top Priority for Finance Leaders, Annual U.S. Bank CFO Survey Reveals
November 01 2022 - 6:00AM
Business Wire
With CFOs facing a wave of challenges, new
research finds less than 15% are ‘very confident’ in their ability
to manage high inflation, digital disruption and talent
shortages
In the 16 months between two U.S. Bank CFO surveys, finance
leaders faced a wave of new challenges, from high inflation to the
effects of the war in Ukraine. The 2022 U.S. Bank CFO Insights
Report, released today, found that finance leaders’ priorities
have shifted as they work to help guide their firms through choppy
waters.
The top-line survey results revealed that:
- Improving risk identification and mitigation is now a top
priority for 30% of finance leaders. In 2021, risk management was
the least identified top priority (18%).
- Driving revenue growth is a top priority for only 21% of
finance leaders. In 2021, driving revenue growth was a top priority
for 35% of leaders.
Cutting costs and driving efficiencies within the finance
function and across the entire business also came in as top
priorities this year.
- 30% of finance leaders said cutting costs and driving
efficiencies within the finance function is a top priority; 29% of
finance leaders said cutting costs and driving efficiencies across
the business is a top priority.
- When it comes to cutting costs, just 22% of finance leaders
plan to reduce headcount across the enterprise, down from 40% in
2021.
- Finance leaders plan to cut costs through investing in
technology (37%), discontinuing low-margin/low-growth business
lines (32%) and outsourcing certain business functions (29%).
- The automotive and transportation industry was most likely to
reduce headcount to cut costs, while the chemicals and advanced
materials, professional services and technology industries were
least likely.
The lack of appetite to cut headcount might be explained by
the top business risk identified by finance leaders: talent
shortages.
- Talent shortages were identified as a top risk for 40% of
finance leaders. The results were nearly identical for firms with
more than $1 billion in revenue (41%) and those with less
(40%).
- Talent shortage risks were ahead of risks posed by the pace of
digital disruption (36%) and high inflation (34%). Just 17% said
rising interest rates were a top risk.
“Our clients in the CFO office are facing a barrage of
challenges – with new ones emerging seemingly every day – as they
help guide their firms through a very uncertain external
environment,” said Stephen Philipson, executive vice president at
U.S. Bank Corporate & Commercial Banking. “Finance leaders
should take this opportunity to play an even more significant role
in risk management, ensuring they have an appropriate strategy to
play defense while continuing to grow the bottom line.”
Fewer than 15% of finance leaders are highly confident in their
company’s ability to manage any of the identified business risks.
For example, just 4% are highly confident they’ll manage high
inflation.
Risk management
- The top risks for businesses are:
- Talent shortage (40%).
- Pace of tech change and digital disruption (36%).
- High inflation (34%).
- Regarding inflation risks:
- The majority (57%) are identifying opportunities to cut costs,
but fewer than four in 10 are conducting any other possible steps
to manage inflation risks.
- 35% are evaluating the credit risk of major customers.
- 32% are evaluating working capital practices.
- 32% are evaluating pricing.
- 31% are hedging against rising costs of certain commodities and
currencies.
- Just 22% are evaluating salaries.
- Regarding talent shortage risks:
- 51% are assessing future skill requirements.
- 42% are reviewing salaries and other employee benefits.
- 42% are exploring opportunities to automate manual
processes.
- Just 18% are offering hybrid working for certain roles to
manage talent risks.
Additional findings from 2022 U.S. Bank
CFO Survey include:
- Evaluating M&A, divestiture and partnership opportunities
dropped from 26% in 2021 to 21% this year.
- Support and/or furthering ESG objectives dropped from 30% to
22%.
View the full 2022 CFO Insights Report
About U.S. Bank
U.S. Bancorp, with approximately 70,000 employees and $601
billion in assets as of September 30, 2022, is the parent company
of U.S. Bank National Association. The Minneapolis-based company
serves millions of customers locally, nationally and globally
through a diversified mix of businesses: Consumer and Business
Banking; Payment Services; Corporate & Commercial Banking; and
Wealth Management and Investment Services. The company has been
recognized for its approach to digital innovation, social
responsibility, and customer service, including being named one of
the 2022 World’s Most Ethical Companies and Fortune’s most admired
superregional bank. Learn more at usbank.com/about.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221101005409/en/
Todd Deutsch, U.S. Bank Public Affairs & Communications
todd.deutsch@usbank.com | 612.303.4148
US Bancorp (NYSE:USB)
Historical Stock Chart
From Jun 2024 to Jul 2024
US Bancorp (NYSE:USB)
Historical Stock Chart
From Jul 2023 to Jul 2024