BrazilHorváth study: CFOs in Europe mostly optimistic about outlook in 2025
Despite all the disruption taking place and new threats looming around the corner, two thirds of CFOs in Europe are optimistic about their outlook for the year ahead, according to a study by Horváth.
The study, which canvassed the views of over 150 CFOs in over a dozen European countries, found that 33% of CFOs expect their business to perform positively in 2025, while a further 32% said that they expect stable growth, or at the minimum not a deterioration of financial results.
Notably, most respondents stated that Donald Trumps’ second term in office – which is typically feared by many European politicians and leaders – will not have a negative impact on finance departments. Only 18% are concerned that new policies under the forthcoming US President will affect their business.
“Political events and developments are always monitored by companies and are factored into business assessments and decision-making. However, they are not always decisive for business prospects,” commented Achim Wenning, partner at Horváth.
Good performance management as a driver
According to the study, the companies that are optimistic in terms of growth prospects in 2025 are primarily those that have a robust performance management in place. Performance management is the process of ensuring that managers have the right data and insights to successfully run the business – being able to do so relies on a high maturity of data and a strong capability to turn insights into action.
Asked about how satisfied they are about the quality of their own performance management process, the majority of CFOs were positive, self-rating their performance as at least satisfactory in six out of eight dimensions.
Horváth’s authors however highlighted the need for further maturing the performance management process, in order to remain competitive and respond to changes in the landscape. Not surprisingly, digital is a key area of opportunity highlighted.
“Most Finance functions achieve an adequate level of performance management through a high level of manual effort. With a further step towards digitization and automation, information quality, predictive capabilities and a reduction in resources can be achieved,” said Wenning.
Generative AI
Among the other main findings of the report, CFOs noted generative AI as a major driver of efficiency gains and innovation within the Finance department. Top use cases identified are creating automated reports and dashboards, creating forecasts for investments and spending, and supporting operational planning and monthly budgeting processes.
Dubbed as a $4.4 trillion productivity opportunity worldwide by McKinsey & Company, generative AI in its current form was previously found to add the most value to customer service and sales departments, followed by procurement.
