India’s senior finance executives remain optimistic about the economy, the outlook for their companies and their investments for the future, according to the 2019 Global Business & Spending Outlook, a survey released by American Express and Institutional Investor Thought Leadership Studio (IITLS).
This optimism can be seen in their spending outlook, with 83% of chief financial officers (CFOs) who participated looking at moderate to aggressive increase in spending and investment this year to support topline growth.
One in three of the CFOs surveyed expect their company’s spending and investment worldwide to increase by at least 10% this year. Nine out of 10 believe that improving cash and working-capital management will be more important this year than in 2018.
According to the survey, 67% of Indian CFOs expect improved use of credit to yield a substantial financial benefit, while 57% are likely to increase their investments in improving administrative process efficiency this year – the focus on efficiently managing bottom-line spending is evident in the increase from 40% voting this as an investment priority last year.
Nearly all (96%) of CFOs plan to spend more or the same amount this year on financial reporting and compliance services.
Travel and entertainment (T&E) continue to be a sizeable part of Indian companies’ spending, with 77% of finance executives planning to increase their spend or invest the same amount on T&E this year.
“Indian firms are gearing up to efficiently manage their spending and investment this year with a keen eye on the future,” said Manoj Adlakha, CEO, American Express India. “While they balance spending to drive top-line growth with profitability, they’re pressing ahead with plans to take advantage of demographic and economic changes to stay relevant and competitive in the next five to 10 years.”
Indian companies continue to grow, with 87% of those surveyed in India reporting higher or much higher revenue in the past 12 months, as compared to 43% last year. The percentage is notably higher than those for both worldwide (65%) and the Asia average (63%) this year.
Indian CFOs also maintain a positive outlook towards global trade policy, with 63% expecting global trade policy to strengthen their company's growth prospects.
“I feel CFOs today play a critical role in the long-term strategic planning and health of the company,” said Adlakha “In fact, one of the findings in the survey is that 73% of Indian CFOs collaborate most closely with the board of directors.
“This is testimony to the increasingly important and strategic role CFOs play, as they navigate organisational spending in line with economic drivers and influences.”
The 2019 Global Business & Spending Outlook was conducted by IITLS and is based on a survey of 901 senior finance executives from companies around the world with annual revenues of US$500 million or more.
In total, 180 CFOs and other senior finance executives from Asia and 30 from companies in India participated in the study. All survey responses were gathered in late November and December 2018.
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