Cost reduction key priority for CFOs, finds survey

According to the survey, 92% of respondents rated global cost reduction as a key issue, while 56% felt it was the role of CFOs to lead cost reduction initiatives. The CFOs also believed that competitive pressures (58%), profitability (58%), and the need for better returns for investors (33%) were the major drivers for cost reduction. The respondents (74%) also agreed that CFOs have to shift their focus from low-value functions like defensive monitoring and reporting to a focus on partnering to help shape growth strategies.

The survey also revealed that factors like increased regulatory and compliance requirements (46%), increased corporate governance obligations (36%) and increasing risk management responsibilities (32%) played a major part in transforming the role of CFOs.

The Economist Intelligence Unit, which conducted the global survey on behalf of Ernst & Young, surveyed 95 CEOs, CFOs, chief information officers and other board level executives. Respondents represented Western Europe (46%), Asia Pacific (22%), North America (19%), and other areas (15%).

But a survey of pharmaceutical CFOs in India found that human resource challenges were major priorities for CFOs in multinational companies (MNC), with 67% ranking employee attrition as a key concern versus only 25% of respondents in India-based pharmaceutical companies. The respondents in both groups considered bottom-line pressures as a key concern (76% overall), although the focus of their cost-cutting efforts differed. CFOs of Indian companies were found to be more concerned about reducing costs in the supply chain (67%) compared with 44% of MNC CFOs.