While most North America-based senior finance executives expect year-over-year local economic expansion during the next 12 months, according to a new survey, many of them also believe that ongoing regulatory and political concerns will have a "negative impact" on such growth. A total of 507 senior executives responsible for finance activities within their companies and based in North America, Asia/Australia, Europe and Latin America completed the survey in spring 2014, released Monday by American Express and CFO Research, of whom 21 percent were based in North America.
About 45 percent of the U.S.-based respondents indicated that they believe improving processes to become more efficient and reducing costs are just as important as meeting customer needs and increasing revenues. Executives around the world had similar sentiments, as 56 percent of all respondents indicated they would balance growth with profitability when it comes to "spending and investment," according to the survey.
"We are sticking to the plan of watching how we spend money," the report quoted a CFO of a mining company, in response to a "shaky" economic environment.
While 76 percent of North American respondents project economic growth for the next year, up from 68 percent in a similar 2013 survey, 40 percent expect regulatory changes to have a "negative impact" on growth. That figure is down 5 percentage points compared with the previous year's survey.
More than half of all respondents, 58 percent, expected their organization's business travel spending to increase during the next year, according to the survey. Respondents were more willing to spend on travel to meet current or prospective customers (29 percent) than they were on other forms of travel, including attending conferences (15 percent), meeting with suppliers (17 percent) or attending internal meetings (13 percent).
Based on the results, American Express and CFO Research concluded that large countries with stable economies, such as the United States and Germany, likely will remain more conservative in spending and investment than will other countries.
"Companies based in these countries are more likely to have been left with excess or underutilized capacity when demand shriveled during the Great Recession," the report concluded. "As the global economy picks up, it makes more sense to bring that excess production capacity back on line than to invest heavily in new capacity."