Business confidence bounces back for CFOs

- Sharpest rise in CFO optimism since 2020;
- Survey shows biggest decline on record for CFOs’ perceptions of external uncertainty;
- Brexit and energy risks ease;
- CFOs see artificial intelligence driving investment and productivity, but are divided on impact on jobs within the workforce.

Sentiment among finance leaders of the UK’s largest firms has improved significantly since the start of the year, according to Deloitte’s UK CFO Survey Q1 2023.

A net 25%1 of CFOs are more optimistic about the financial prospects of their business than they were three months ago. Having run well below the long-term average reading of -2% throughout the last year, this marks the largest increase in confidence since the COVID-19 vaccine rollout at the end of 2020.2

Conducted between 21 March and 3 April 2023, Deloitte’s latest quarterly CFO Survey captures sentiment amongst the UK’s largest businesses. A total of 64 CFOs participated, including the CFOs of 11 FTSE 100 and 24 FTSE 250 companies. The combined market value of the 38 UK-listed companies surveyed is £253bn, or approximately 10% of the UK quoted equity market.

Uncertainty down sharply

This quarter’s survey was conducted in the period following the collapse of Silicon Valley Bank on 10 March and pressures on some regional US banks. However, the findings suggest these events seem to have had little, if any, impact on UK CFO sentiment.

Perceptions of external financial and economic uncertainty have fallen at the fastest pace since this question was first asked in 2010, from 71% of CFOs rating uncertainty as high or very high in Q4 2022, to 39% doing so in Q1 2023. CFOs now rate external uncertainty at levels far below the previous peak last autumn, the start of the pandemic in 2020, and following the EU referendum in 2016.3

Ian Stewart, chief economist at Deloitte, said: “The economic unpredictability that marked the beginning of 2023 has started to clear, with CFOs reporting the largest decline in perceptions of uncertainty to date. Business confidence has rebounded, helped by a decrease in energy prices, an easing of Brexit concerns and an improving inflation backdrop.

“Crucially, finance leaders report little change in credit conditions, suggesting that March’s events in the global banking system have not affected the pricing and availability of credit for UK corporates. Despite a brighter outlook, CFOs are alive to the continued risks facing the economy. Corporates remain in defensive mode and CFO risk appetite is subdued.”

Focus on defensive strategies

CFOs report a slight rise in the cost of credit and a marginal improvement in credit availability in the first quarter. Around three quarters (a net 73%) rate credit as costly – up from a net 66% in Q4 2022 – while a net -2% say that new credit is easily available, up from a net -22% in Q4 2022.

Risk appetite remains below normal levels, with just 17% of CFOs saying this is a good time to take greater risk onto their balance sheets. CFOs are instead heavily focussed on cost control and building up cash, with 41% and 44% of CFOs respectively rating those as strong priorities for their businesses. Furthermore, although CFOs’ revenue growth expectations have jumped from a net -8% to a net 44%, a large majority of respondents (65%) expect margins to shrink in the next 12 months, reflecting continued growth in input costs.

Inflation tide turning

CFOs see Brexit, high energy prices and disrupted energy supplies posing significantly less risk to business than they did in Q4 2022. The announcement on 27 February of the Windsor Framework, which aims to improve the flow of goods between Britain and Northern Ireland, is likely to have contributed to the easing of CFO concerns around Brexit, which are now close to the lowest level in over six years. Falling energy prices – with wholesale gas prices down by almost 70% since CFOs were last surveyed – are also likely to have reduced the risks posed by elevated energy prices.

Finance leaders report a fall in supply disruptions faced by their businesses this quarter. A small proportion (7%) expect ‘significant’ or ‘severe’ levels of disruption to persist in a year’s time, and the panel expects such disruption to ease entirely in two years from now. CFOs also reported a marked easing of recruitment difficulties in the first quarter, while expectations for inflation in one year’s time have declined from 5.8% to 4.2%, and eventually to 2.9% in two years’ time.

Look towards growth

Meanwhile, an overwhelming majority of CFOs expect to see a significant growth in capital spending on artificial intelligence (AI) over the next five years. A large majority (a net 67%), also believe the adoption and application of AI will help raise UK productivity. However, respondents were almost equally divided between those who believe that AI will lead to an increase in the number of jobs and those who believe it has the potential to reduce jobs over the next five years.

Ian Stewart added: “The CFOs foresee artificial intelligence helping to drive UK productivity, an outcome that could provide a lasting boost to business growth. They are divided, however, on how AI will affect the number of jobs in the economy, highlighting the need to ensure the gains from new technologies are widely shared.”

Paul Schofield, Senior Partner at Deloitte in Cambridge commented “The latest CFO survey reflects the returning optimism we are hearing from the businesses we work with. Although the CFOs are seemingly still in defensive mode, we are seeing many corporates that are now investing further in transformation and strategic priorities.”

About the survey

This is the 63rd quarterly survey of Chief Financial Officers and Group Finance Directors of major companies in the UK. The 2023 first quarter survey took place between 21 March and 3 April. 64 CFOs participated, including the CFOs of 11 FTSE 100 and 24 FTSE 250 companies. The rest were CFOs of other UK-listed companies, large private companies and UK subsidiaries of major companies listed overseas. The combined market value of the 38 UK-listed companies surveyed is £253 billion, or approximately 10% of the UK quoted equity market.

The Deloitte CFO Survey is the only survey of major corporate users of capital that gauges attitudes to valuations, risk and financing.

For copies of previous CFO surveys, please visit

About Deloitte

In this press release references to “Deloitte” are references to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”) a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity.

Please see for a detailed description of the legal structure of DTTL and its member firms.

Deloitte LLP is a subsidiary of Deloitte NSE LLP, which is a member firm of DTTL, and is among the UK's leading professional services firms.

The information contained in this press release is correct at the time of going to press.

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