PwC’s COVID-19 CFO Pulse Survey

What finance leaders in Switzerland are focused on: 16 April 2020

PwC is tracking the responses of finance leaders to the COVID-19 outbreak. This site presents the results of our second look at changing sentiments and priorities among a small but relevant group of finance leaders in Switzerland. For this round we surveyed CFOs at the largest Swiss companies in diverse industries during the week of 6 April.

The Swiss findings are part of PwC’s global survey. Thanks to the growing number of CFOs and countries participating, it is providing an increasingly representative view and the opportunity to cross-compare with greater granularity. The previous round involved eight countries and 150 CFOs; in the current wave PwC polled 824 CFOs from 21 countries or territories; and we will continue to add companies to offer a robust view of how the crisis is affecting people and businesses − in Switzerland and across the globe.

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.

The responses in more detail

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



Question: What is your company’s current level of concern related to COVID-19?

%
%
%
Potential for significant impact to our business operations, and it is causing us great concern.
Limited to specific regions in our business currently, but we are monitoring closely.
An isolated challenge; not greatly impacting our business currently, but we are monitoring the situation for any change.
Source: PwC COVID-19 CFO Pulse Survey, 8 April 2020
Base: 36

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



Question: What are your top three concerns with respect to COVID-19?

Financial impact, including effects on results of operations, future periods and liquidity and capital resources
%
Potential global recession
%
Effects on our workforce/reduction in productivity
%
Supply chain issues
%
Decrease in consumer confidence reducing consumption
%
Difficulties with funding
%
Impacts on tax, trade or immigration
%
Not having enough information to make good decisions
%
Privacy risks
%
Cybersecurity or fraud risks
%
Lack of a comprehensive/tested company emergency preparedness plan
%
PwC COVID-19 CFO Pulse Survey, 8 April 2020
Base: 36

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



Question: What impact do you expect on your company’s revenue and/or profits this year as a result of COVID-19?

Decreased revenue and/or profits
%
It is difficult to assess at this point
%
We do not expect any impact on revenue and/or profits
%
Increased revenue and/or profits
%
Source: PwC COVID-19 CFO Pulse Survey, 8 April 2020
Base: 36

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



Question: Which of the following financial actions is your company considering as a result of COVID-19? (Select all that apply)

Implementing cost containment
%
Deferring or cancelling planned investments
%
Changing company financing plans
%
Adjusting guidance
%
Other
%
We have not taken any financial actions as a result of COVID-19
%
Changing M&A strategy
%
Source: PwC COVID-19 CFO Pulse Survey, 8 April 2020
Base: 36

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%). 


M&A strategy is holding steady



Question: How is COVID-19 affecting your M&A strategy?


67%
No change
11%
Difficult to assess currently
14%
Decreasing appetite
8%
Increasing appetite


Source: PwC, COVID-19 CFO Pulse, 8 April 2020
Base: 36

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



Question: Is your company planning on or considering taking advantage of any government programme/action designed to address the economic fallout from COVID-19?


44%
Yes
36%
Not at present
19%
Difficult to assess currently


Source: PwC, COVID-19 CFO Pulse, 8 April 2020
Base: 36

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.



Question: If COVID-19 were to end today, how long would you estimate it would take for your company to get back to ‘business as usual’?

%
%
%
%
%
Less than a month
1 to 3 months
3 to 6 months
6 to 12 months
More than 12 months
72%
 
Note: Sums may not total 100 due to rounding.
Source: PwC COVID-19 CFO Pulse Survey, 8 April 2020
Base: 36

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.

About the survey

To help identify the business and economic impact of COVID-19, PwC is conducting a biweekly survey of finance leaders in different territories all over the world, including Switzerland. The CFOs surveyed in Switzerland during the week of 6 April represent Swiss companies in diverse industries. The next set of results will be released in the week of 27 April 2020.

Contact us

Julie Fitzgerald Wieland

Julie Fitzgerald Wieland

Partner and Growth & Markets Leader, PwC Switzerland

Tel: +41 58 792 26 80

Jan-Hendrik Völker-Albert

Jan-Hendrik Völker-Albert

Head of Marketing & Communications, PwC Switzerland

Tel: +41 58 792 1885

Reto Brunner

Reto Brunner

Partner, Advisory, PwC Switzerland

Tel: +41 58 792 14 19

Norbert Kühnis

Norbert Kühnis

Leiter Familienunternehmen und KMU, Mitglied der Geschäftsleitung, PwC Switzerland

Tel: +41 58 792 63 63