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CFOs expect better economic conditions a year ahead, but plan for a mild recession: Deloitte CFO Signals™ Survey 1Q 2023

NEW YORK, March 14, 2023

Key Takeaways

  • The proportion of CFOs expressing optimism for their companies’ financial prospects rose to 32% from last quarter’s 20%. Their appetite for greater risk-taking jumped to 40% this quarter, up from last quarter’s 29%.
  • A vast majority (93%) of surveyed CFOs have their finance organization focused on planning for a mild recession.
  • Nearly two-thirds (65%) of CFOs expect inflation in the United States to range between 4% and 6% by the end of 2023.
  • More than half (54%) of CFOs see the North American economy improving over the next 12 months.
  • The top three actions CFOs are taking to prepare for an economic recovery are investing in growth, sales, customers and new markets; controlling cost/increasing operational efficiency; and building inventory/production capacity to meet demand.
  • More than half of CFOs pointed to inadequate technologies/systems, immature capabilities, and lack of experienced talent as their greatest obstacles in driving data to insights.

Why it matters to CFOs?

Each quarter, CFO Signals™ tracks the thinking and actions of leading CFOs representing North America's largest and most influential companies. Since 2010, the survey has provided key insights into the business environment, company priorities and expectations, finance priorities and CFOs' priorities. Participating CFOs represent diversified, large companies, with 78% of respondents reporting revenue greater than $1 billion. Slightly less than one-quarter (22%) are from companies with greater than $10 billion in annual revenue.

Economic outlook

CFOs’ sentiment toward current conditions rose across the five economic regions covered in the CFO Signals survey, except South America. For North America, 40% of CFOs rated the current economy as good or very good, up from 35% in 4Q22. More than half (54%) of CFOs expect conditions in North America to improve in a year, up measurably from 29% last quarter.

CFOs’ economic outlook also improved for the other four regions. Five percent of CFOs view the economy of Europe as good or very good now, an increase from 2% in 4Q22. Nearly a third (32%) of CFOs anticipate better conditions in a year, compared to 9% in 4Q22. Similarly, 6% of CFOs view the current economic conditions in China favorably, and 41% anticipate better conditions in a year. The percentage of CFOs who view the current economy of Asia, excluding China, favorably rose to 22% from last quarter’s 15%, and 32% of CFOs expect conditions to improve in a year. While CFOs’ sentiment toward current condition in South America declined slightly, it improved for the future outlook, to 17% from 8% last quarter.

Own company optimism and risk

The percentage of CFOs feeling more optimistic for their companies’ financial prospects rose to 32% from 20% in the prior quarter. This figure is the highest it has been since the 2Q22 survey. The proportion of CFOs saying now is a good time to take greater risks jumped to 40% from 4Q22’s 29%.

Inflation and geopolitics/political instability stood out for the second consecutive quarter as CFOs’ most pressing external risks. Talent retention, along with talent availability and hiring talent, once again led their internal list of worries, followed by prioritization and execution.

Key operating metrics

CFOs raised their year-over-year growth expectations for revenue, earnings, capital investment and domestic hiring. Growth expectations for dividends and domestic wages/salaries fell this quarter. Revenue growth increased to 4.4% from 4.2%, earnings growth rose to 5.4% from 2.9%, capital investment growth expectations climbed to 5.7% from 4%, and expectations for domestic hiring growth increased slightly to 2.3% from 2.1% last quarter. CFOs lowered their expectations for domestic wages/salary growth for the second consecutive quarter to 4.3% from 4.6%, and growth expectations for dividends fell to 2.4% from 3.1%.

Recession planning and inflation expectations

The vast majority (93%) of surveyed CFOs indicated that their finance organizations are focused on planning for a mild recession. Fifty-five percent of surveyed CFOs indicated they are satisfied with their companies’ decision-making to prepare for a downturn or recession. More than half (53%) also reported satisfaction with their companies’ decision-making for a recovery/rebound.

CFOs who think there will be an economic recovery or rebound are taking action to prepare. The top three actions CFOs reported include: investing in growth, sales, customers and new markets; controlling costs/increasing operational efficiency; and building inventory/production capacity to meet demand.

Regarding inflation, nearly two-thirds (65%) of CFOs expect inflation in the U.S. to range between 4% and 6% by the end of 2023, indicating continued concern over inflation’s persistence.

Transforming data into insights

Businesses often expect their finance organizations to provide deeper and timelier insights from data, but there can be challenges. In this quarter’s CFO Signals survey, the three greatest challenges CFOs shared in turning data into insights are: inadequate technologies/systems; immature capabilities to translate data into insights; and lack of experienced talent to analyze data and generate insights from it.

To improve their companies’ decision-making in planning for the remainder of 2023 and 2024, CFOs most frequently suggested implementing digital technologies, artificial intelligence (AI), automation, improving forecasting, scenario planning and consistency in measuring key performance indicators (KPIs). To improve their organizations’ ability to drive data to insights, CFOs pointed to investing in new systems & automation/upgrading existing systems and implementing talent/organizational changes.

More than half (52%) of CFOs surveyed said their companies do not have a Chief Data Officer (CDO) or equivalent. Of the CFOs whose companies do have a CDO or equivalent, 33% say that position sits within the IT function and 10% indicated it resides within finance. Additionally, organizations with a CDO or equivalent appear not to be taking full advantage of the resource, as only slightly more than half (56%) of CFOs say their finance organization works routinely with the CDO or equivalent in the course of finance’s work.

Assessment of capital markets 

The percentage of CFOs indicating that U.S. equities were neither overvalued nor undervalued remained flat for the second consecutive quarter at 50%. The proportion of CFOs saying U.S. equity markets are overvalued increased to 36% from last quarter’s 30%, while the proportion of CFOs considering U.S, equity markets undervalued declined to 14% from 20% in the prior quarter. Just 16% of CFOs see equity financing as less attractive this quarter, down from 25% in 4Q22. The percentage of CFOs considering debt financing attractive remained unchanged at 15%.

Key quotes

CFOs are planning for two futures: one where there could be a mild recession and another where the economy recovers. Despite their improved outlook on the economic conditions both now and in a year, uncertainty over inflation could sway their plans one way or another. Deloitte’s first-quarter CFO Signals survey found that most CFOs don’t expect it to fall much further before year-end, which could explain their caution. Regardless of where the economy lands, CFOs say their companies could enhance decision-making for the remainder of the year and 2024 by implementing digital technologies, AI, automation, improving forecasting, scenario planning and consistency in measuring KPIs.

— Steve Gallucci, national managing partner, US CFO Program, Deloitte LLP, and global leader, Deloitte Touche Tohmatsu Limited

Download the findings from the Q1 2023 CFO Signals survey here.


Every quarter, Deloitte’s CFO Signals closely follows the thinking and priorities of leading CFOs who represent some of North America’s largest and most impactful organizations. This report summarizes CFOs’ opinions across four key areas: business environment, company expectations and priorities, financial priorities and personal priorities.

The CFO Signals survey for the first quarter of 2023 was conducted between Feb. 6, 2023, and Feb. 21, 2023. A total of 111 CFOs participated in this quarter’s survey. This survey seeks responses from CFOs across the United States, Canada and Mexico, and the vast majority are from companies with more than $1 billion in annual revenue. Participation is open to all industries except public sector entities.

For more information about Deloitte CFO Signals or to inquire about participating in the survey, please contact

About Deloitte

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