Global Finance Survey: Coffers Opening, But Not For Business Travel

An annual survey of more than 500 senior finance executives at large firms found they are "holding the line on travel spending," contrasting the "positive signs to increase their budgets" respondents noted in 2011.

Although 58 percent this year said they expect to spend the same or more on business travel during the next year, that's down from 64 percent in 2011, according to the research from American Express and CFO Research Services. Respondents in the United States were more bullish than the global average, with 71 percent saying they would spend the same or more on business travel during the next 12 months.

"To make the most of their travel budgets, companies will focus their resources on travel that is closely connected with revenue expansion," the report indicated. "Almost nine in 10 will spend the same or more on travel to meet with current or prospective customers—with 38 percent likely to spend more."

Tighter purse strings and stronger pressure to deliver return on investment exist even as, the study found, corporate coffers are opening. The number of finance executives who said they were likely to spend down cash reserves this year outnumbered those who said they were not. "This is an important change from last year, when a sizable majority of all respondents (62 percent) were pursuing a deliberate cash preservation strategy," according to Amex/CFO.

Three-quarters of respondents said the cash would fund ongoing operations, with 70 percent citing expanded operations, 69 percent indicating increased capital spending, 68 percent choosing increased research and development and 66 percent citing mergers and acquisitions.

Slightly more than one-quarter of the 541 survey respondents to the survey, fielded in February, were based in North America, with 35 percent from Asia/Pacific, 30 percent from Europe, 8 percent in Latin America and 1 percent in the Middle East and Africa. Responding firms generated a minimum of $500 million in annual revenues. The study also included information "in-depth interviews" with 20 senior finance execs.