Chief financial officers believe public mistrust of business and political leaders is hurting the global business environment, according to a quarterly survey by Duke University/CFO Magazine Global Business Outlook.
The majority of CFOs also believe that severe sanctions on Russia would hurt the economies of their home countries.
The latest survey results, released Wednesday, also found that economic optimism is up in both the U.S. and Asia, but is down sharply in Latin America and Africa. On a scale of 0 to 100, CFO optimism about the U.S. economy has increased to 61, just the second time the index has been this high since mid-2007.
U.S. and European companies are evenly split on whether they will begin to deploy their cash reserves this year or continue to hold on to it tightly.
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“Those companies that expect to start spending down their reserves are primarily looking to invest in their own growth, which I take to be a positive sign,” said David W. Owens, director of research at CFO Publishing, in a statement.
The survey results found that a lack of trust among leaders has caused businesses to alter decisions, change governance and emphasize transparency.
“While all of these effects may not be negative, like increasing transparency, several of the effects are negative, and they all require companies to expend resources and can distract management’s focus,” said John Graham, a finance professor at Duke’s Fuqua School of Business and director of the survey, in a statement.
He said distrust keeps the economy from reaching its full potential, and can reduce growth and force companies to spend valuable time counteracting its negative effects.