Recession is unavoidable, reckon Swiss finance bosses

An empty restaurant in Lucerne on March 20 Keystone

The coronavirus pandemic has fundamentally changed the economic outlook for Switzerland within a very short period of time, with Swiss CFOs more pessimistic than ever before. 

Neither during the euro crisis nor during the Swiss franc shock were chief financial officers as negative about economic prospects as they are today, according to the latest half-yearly surveyExternal link published on Monday by consultants Deloitte.  

Deloitte’s 38th CFO survey was carried out online between March 2-30. It thus straddled the government’s imposition of sweeping measures on March 13. 

Despite the circumstances, 90 CFOs of listed and non-listed companies took part. 

(Source: Deloitte)

Although the surveys have been indicating a cooling off for almost two years, there has now been a real crash in confidence: 97% of the CFOs surveyed after mid-March expect the economy to develop negatively over the next 12 months – and 41% of them even foresee a strongly negative dynamic.

In addition, two-thirds (67%) see a negative financial development for their company and only 15% see a positive one. Overall, 93% see their company’s future as less rosy than three months ago. 

More than three-quarters (78%) expect a decline in sales, while more than half (52%) expect the number of employees to decline within a year. 

Digitisation push expected 

However, the majority of Swiss CFOs are actively countering the crisis, the survey reported. For example, 91% of companies have taken measures to curb the weak growth; the most frequently cited measures were cost savings and revenue generation. 

The really successful companies were already looking at the post-crisis period, said Alessandro Miolo, responsible for the CFO study at Deloitte. 

“They are examining possible purchases or sales of parts of the company and implementing necessary internal changes in a targeted manner. I expect a major push in digitisation as a result of the [coronavirus] crisis,” says Miolo.