PwC’s COVID-19 CFO Pulse Survey

The main findings for Switzerland in brief

• Swiss CFOs (along with their counterparts in Germany and Denmark) seem significantly less concerned about the COVID-19 crisis than their peers in other parts of the world. Only 58% of respondents in Switzerland believe the outbreak has the potential to significantly impact their business operations, compared with 73% of their counterparts for all surveyed territories.
• The level of concern among respondents in Switzerland has decreased from 75% observed in the first survey wave to 58% in the second wave.
• Global recession, financial impact and effects on the workforce are ranked as the top-three concerns by respondents in Switzerland; this is largely in line with the overall sample.
• CFOs in Switzerland express the greatest degree of confidence across all surveyed territories in the long-term stability of their M&A strategy. Of the CFOs polled, 67% say that they don't expect to change their approach to M&A, compared with only 30% observed in the global sample.
• Nearly half (44%) of CFOs in Switzerland say their company plans to take advantage of government support programmes offered in response to COVID-19, which is considerably higher than in Germany (16%).
• Respondents in Switzerland have more bullish expectations about business ‘bouncing back’ than their counterparts in the overall sample: Of the Swiss CFOs surveyed, 72% expect a return to ‘business as usual’ within three months, compared with 56% of CFOs in the global sample.
• Compared with the first survey wave, the number of CFOs in Switzerland expecting a recovery in less than a month has declined considerably, from 65% to only 22% in the second wave.

To sum up, Swiss CFOs seem less concerned about the impact of COVID-19, thanks to a firmer belief in faster recovery and strong use of government support.

CFOs in Switzerland seem significantly less concerned regarding COVID-19 across the surveyed territories

The level of concern among CFOs in Switzerland regarding the effect of COVID-19 on business operations is lower than for the overall sample. Of those questioned in Switzerland, 58% believe the outbreak has the potential to significantly impact their business operations, compared with 73% of their counterparts across all surveyed territories. CFOs’ level of concern varies largely across territories, with those in Denmark, Germany and Switzerland least concerned. The result is also lower than the 75% observed in the first survey wave for Switzerland.

Interestingly, more respondents (31%) currently perceive COVID-19 as being limited to specific regions than in the first round of the survey (15%).

What’s on CFOs’ minds? Global recession, financial impact and effects on workforce

As the leaders responsible for cash flow and capital structure, CFOs are most concerned about global recession, along with the financial effects of the coronavirus on their company’s operations, liquidity and capital resources. They are also considering how to incorporate the crisis into their financial reporting: 50% plan to include discussion of COVID-19 in financial statements, and 36% as part of the earnings release.

Surprisingly, cybersecurity, privacy and fraud risks, which pose a large threat to business operations, are ranked as least important by respondents in Switzerland and globally. This could be attributed to the fact that the survey is targeted at CFOs, who perceive financial-related risks as the top concern, as opposed to CIOs, for whom keeping data secure and ensuring privacy while employees work remotely are a more pressing concern.

Majority expect adverse impact on business, though sizeable minority still cannot predict

Large-scale interruption of business activities and the postponement of various projects are already causing an observable decline in the financial results of most businesses. Three-quarters of Swiss respondents expect COVID-19 to have a negative impact on revenues and/or profits, while 17% of respondents have difficulty assessing the impact of COVID-19 on their revenues. These results are comparable across the overall sample of surveyed territories: on a global basis 80% of CFOs expect a decrease in revenue as a result of COVID-19, while 13% are unsure of the impact. 

CFOs target containing costs and cancelling investments in response to COVID-19

When it comes to potential financial actions to help mitigate the effects of the coronavirus, most Swiss CFOs are considering cost containment measures (69%) and deferring or cancelling planned investments (67%), with changing company financing plans (64%) a very close third.

Of those CFOs considering changes to their investment strategy, most (83%) plan to reduce general capex investments. With many employees out of offices and factories, companies may look to cut spending on facilities and other maintenance costs. Other potential reductions could come in the workforce (58%) and operations (54%). 

CFOs in Switzerland express greater confidence in the long-term stability of their M&A strategy than any in the overall sample. Although the coronavirus has cast uncertainty over the immediate future of many organisations, 67% of Swiss CFOs say that they don't expect to change their approach to M&A, with only 11% saying they are unsure how the crisis will affect M&A activity. This is consistent with the response provided on financial actions companies plan to take, where changes in the M&A strategy have lower priority in Switzerland than in the other territories. 

CFOs consider their response to government relief programmes

Nearly half (44%) of CFOs in Switzerland say their company plans to take advantage of government support programmes offered in response to COVID-19, which may seem on the low side. But it remains to be seen whether this number will increase as more organisations move into the second wave of crisis response and begin to have a clearer view of their needs, and the corresponding strategic decisions. The second wave is typically when companies assess government stimulus programmes.

The results vary greatly across territories: only 16% of respondents in Germany plan to take advantage of government programmes compared with almost 50% in US. This is in line with the level of concern about the potential impact of the coronavirus expressed by CFOs in the different countries.

Swiss CFOs have more bullish expectations about business ‘bouncing back’ than their counterparts in the overall sample.

If the COVID-19 crisis were to end immediately, 72% of Swiss CFOs would expect a return to ‘business as usual’ within three months. This optimism evokes a sense of hope that should be grounded in realism — which may or may not be happening yet at some companies. Sentiments shared by the overall sample are more pessimistic, where almost half of respondents expect the recovery to take more than 3 months. Unsurprisingly, CFOs in countries that expressed less concern about the pandemic’s potential impact on their business are also more confident about their organisation’s ability to bounce back (Germany, Denmark and Switzerland).

Monitoring finance leaders’ evolving response

As the crisis progresses, finance leaders will obviously need more information to finalise their plans in specific areas of their organisations. Some companies are still in the early stages of crisis management and have yet to make decisions that will shape their recovery; others have established a course which they’re looking to trim as the situation develops. As more countries reach or pass their peak, we’ll continue to track finance leaders’ perceptions and actions to understand how their response is evolving.