Finance chiefs at the UK’s largest companies have said that Brexit is the most significant risk to their businesses, as firms tighten spending and scale back on recruitment plans.
Deloitte’s latest quarterly CFO survey found that around 80% of CFOs expect the long-term business environment to be worse as a result of the UK leaving the European Union.
The survey also found a diminished appetite for capital expenditure, M&A and introducing new products or services and that CFOs are placing greater focus on cost reduction now than at any time in the last nine years.
In addition, CFOs are also more negative on the effects of Brexit on their own hiring and spending decisions, with more than half saying that hiring will slow over the next three years.
Ian Stewart, chief economist at Deloitte, said: “This survey shows that uncertainty over Brexit is driving a marked shift towards defensive balance sheet strategies among British businesses.
“Corporates are positioned for the hardest of Brexits, with risk appetite at recessionary levels and an intense focus on cost control. Businesses seem to be increasingly pricing in a worst-case outcome. Anything better, including a delay or a deal, could deliver a Brexit bounce in sentiment.”
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