The 2024 CFO Outlook Survey found that with continued economic uncertainty tied to interest rates, inflation, geopolitics and the upcoming presidential election, many CFOs have moderate expectations for 2024 compared to the previous year: Now, 32% predict flat or decreased revenues, while 34% expect the same for profitability. Last year, only 18% of CFOs predicted flat or decreased revenues, and a fourth expected the same for their profitability.
Despite the uncertainty, CFOs are finding opportunities to create stability and foster resilience in their organizations while also uncovering ways to promote growth. New tools like generative artificial intelligence (AI) and new approaches to business issues like worker engagement present exciting prospects that are shaping the middle market’s focus this year.
"In this economic environment, thriving companies are being even more intentional about their approach to financial stability and long-term growth," says Wayne Berson, CEO of BDO USA. "Those looking to prosper as the market rebounds must take bold action now to gain market share, carve out a competitive advantage, and position their organization for sustainable growth."
- Economic volatility is the top risk on CFOs' minds this year, with 66% saying it poses the same or greater risk now than it did a year ago. Generative AI and data privacy risks are also pervasive. To counteract these risks and build strategic resilience, 44% of CFOs plan to increase their involvement in digital transformation strategies, likely in an effort to improve efficiency and reduce costs.
- Although CFOs have felt some reprieve from the tight labor market and high attrition rates, workforce engagement remains a priority. Thirty-six percent of CFOs say their involvement in strategic conversations related to workforce strategy will increase in the next 12 months. Some of the biggest changes they'll make this year include increasing monetary compensation (36%), enhancing non-monetary benefits (29%) and expanding headcount (30%).
- Ninety-five percent of companies surveyed have an ESG strategy in place, up ten percentage points from the year prior. Further, more than half of CFOs (53%) have embedded ESG principles into their core business strategy or are actively working to do so. Companies increasingly see sustainability efforts as a strategic opportunity to build resilience.
- Generative AI is transforming the way CFOs think about their businesses of tomorrow, especially when considering governance and maintaining data integrity. In a bid to future-proof their organizations, nearly half (49%) of companies have formalized or are formalizing a policy around generative AI. While the greatest opportunities are still being uncovered, CFOs expect it to support all areas of their business including compliance, customer service, safety monitoring and more.