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CFO Survey: Growth worries, cost reductions and rising prices in focus

Swedish CFOs’ views of business opportunities going forward have worsened considerably, and their views of the financial outlook have fallen to the lowest level since 2013. Cost reductions have ascended as the top priority among CFOs, while economic growth is seen as the greatest risk. This is according to the autumn CFO Survey from Deloitte and SEB.

“A dark and potentially cold winter awaits the economies in Europe and the Nordic countries. Granted, the recovery since the pandemic has shown some resilience, but with energy and food prices digging deep holes in consumers’ wallets and central banks around the world raising interest rates, economic activity is falling. This development is clearly shown in this autumn’s CFO Survey, where the outlook on business opportunities in the coming six months has clearly deteriorated as the spring’s uncertainty has given way to expectations for lower economic growth going forward,” says Marcus Widén, economist at SEB.

The share of CFOs who view business opportunities as favourable in the coming six months has declined in this autumn’s CFO Survey to 38 per cent, from 48 per cent during the spring and 73 per cent in the survey that was conducted in autumn 2021. At the same time, the share of CFOs who now view the future as being less favourable has grown to 17 per cent, from 11 per cent last spring. This means that the indicator – or the net balance between those who have a positive view and those with a negative view – has fallen to 20 from 41 this past spring. The view on the financial outlook has also declined, and the net balance is now minus 29, compared with zero last spring. This is the lowest level since the survey was first conducted in 2013.

“We see differences between various sectors, sub-segments and individual companies based on their views of business opportunities and the financial outlook. Among the sectors with the highest net balance in both of these areas are energy, power generation, mining, media and telecom, while the lowest net balance can be found in engineering and construction,” says Robert Bergström, partner at Deloitte.

Priorities and risks
Since spring 2021 organic growth has been at the top of the list of CFOs’ priorities, but in the 2022 autumn survey, cutting costs has instead become the top priority. A full 61 per cent of CFOs cited cutting costs as a priority, compared with only 33 per cent last spring. This area is followed by focus on improved cash flow and organic growth.

As for risks, 58 per cent of CFOs cited economic growth as a significant risk in the coming 12 months, which makes it the greatest risk as well as the one that has risen the most since the spring survey. Pressured prices and margins as well as reduced domestic demand are the second and third highest risks on the autumn list. Geopolitical risks, which were viewed as being the most significant risk in the spring survey, are at the same time perceived as being less prominent – falling from 45 to 28 per cent.

The autumn survey also included questions about the rising inflation, which has become considerably higher since spring and has come to encompass more parts of the economy. Even though the rate of price increases at the moment appears to have slowed somewhat, the survey shows that consumers will be feeling higher prices for quite some time to come. Around three quarters of CFOs responded that higher costs will be passed on to consumers through higher prices to a large or medium-large extent.

About the survey

The CFO Survey was conducted in September 2022 and is based on a number of questions that were presented to and answered by selected participants via a web-based questionnaire. The CFOs who participated in the survey represent a cross-section of major Swedish companies from various sectors.

The full survey can be found here: www.cfosurvey.se.

For more information, please contact:
Marcus Widén, Economist, SEB
+46 70 639 1057

Niklas Magnusson, Group Press Officer
+46 70 763 8243

SEB is a leading northern European financial services group with international reach. We exist to positively shape the future with responsible advice and capital, today and for generations to come. By partnering with our customers, we want to be a leading catalyst in the transition to a more sustainable world. In Sweden and the Baltic countries, SEB offers financial advice and a wide range of financial services. In Denmark, Finland, Norway, Germany and the United Kingdom, we have a strong focus on corporate and investment banking based on a full-service offering to corporate and institutional clients. The international nature of SEB's business is reflected in our presence in more than 20 countries worldwide, with around 16,500 employees. At 30 September 2022, the Group's total assets amounted to SEK 4,277bn while assets under management totalled SEK 2,018bn. Read more about SEB at sebgroup.com.