The CFO 411: Team Networks Expand, Finance Execs Turn Over

Network of connections

No matter the physical distance, news from across the pond seems to have a ripple effect on businesses everywhere. Talk of a Brexit (Britain exiting the EU) has analysts warning that currency volatility could get even more out of hand for American companies. European policymakers grilled U.S. multinational corporations about whether their complex structures were meant to unfairly shirk tax liability. And mayhem surrounding the national elections has economic forecasters all over the world scratching their heads. Depending on which radically different candidate moves into the White House, what might the future hold? On this St. Patrick’s Day, it’s tough to know who has the luck of the Irish on their side.

4 need-to-know headlines

1. Currency fears as Britain eyes the exit

Gloomy news for multinational corporations: If volatile exchange rates aren’t nail-biting enough, news that Britain may leave the European Union could be ulcer-inducing. Analysts warn that a British departure could hamper economic growth across Europe. The move may also put currency exchange rates in the crosshairs, weakening both the euro and the pound against the U.S. dollar. On Wednesday, Britain’s Chancellor of the Exchequer George Osborne pointed to “a dangerous cocktail of risks”—including a weak outlook for global growth and turbulent financial markets—as reason for Britain to stay put. (via Nytimes.com)

 

2. Election turmoil ushers in economic uncertainty

With each new U.S. president comes a wave of new policies, which makes it tough to make economic predictions during election years. But this election cycle has economists even more stumped than usual, according to a new Wall Street Journal survey. More than three-fourths of economic forecasters say they’re having a harder time predicting what the future might hold once a new president is in place. When asked about economic growth, the average survey respondent estimated the U.S. economy will grow 2.4% this year and next. But whether Donald Trump or Hillary Clinton move into the While House—well, that estimate could easily change. (via WSJ.com, log-in required)

 

3. Teams reach a fever pitch

If your company seems to value cross-functional teams more now than ever before, it’s hardly alone: A new global Deloitte survey of more than 7,000 execs found that organizations today tend to operate more as a network of teams than a conventional hierarchy. That’s great news for the once-siloed finance department, as employees now find themselves working across disciplines and on far-reaching problems and projects. It can be harder news for finance leaders, as managing such sprawling teams can be a challenge. (via Economist.com) 

 

4. Fed scales back pace of rate hikes

When Federal Reserve officials announced earlier this week that they were reducing estimates of how much they expected to raise short-term interest rates in 2016, Wall Street gave a collective fist pump and U.S. stocks rose. Yet the soft global economic growth and market volatility that caused the Fed to scale back rate hikes here has sparked a very different reaction abroad: The European Central Bank announced last week that it will cut interest rates further below zero, and the Bank of Japan—after slashing deposit rates in January—indicated it may soon ease rates even further. (via Bloomberg.com)

The stat: 21%

The share of consumer and retail companies with CFO turnover last year. As businesses work to find and keep their competitive edge, that can sometimes mean a shakeup in the C-suite—and a new face in the CFO chair. U.S. retail sales fell in both February and January, according to indicator revisions. (via WSJ.com, log-in required)

Sound bite of the week

“We make use of tax incentives, tax structures that are well known, that are widely accessible and used by most multinationals.”
Adam Cohen, head of economic policy for Alphabet’s Google in Europe
Cohen answered questions by European lawmakers, seeking to determine whether the multinational—and other U.S. companies like it—have funneled billions of dollars of profit out of Europe without paying an adequate amount of taxes. (via Morningstar.com)

 

4 Top Stories + 1 Key Statistic + 1 Industry Quote = The CFO 411
The CFO 411 is our weekly news roundup that brings you top headlines, data points, and sound bites to keep you in the know. Follow our updates on LinkedIn for more finance must-reads.

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