BREXIT is becoming an increasing possibility for more than half of the UK’s CFOs according to a new survey, despite it revealing that most corporate officers have failed to take action to minimize the negative effects of an EU exit on their companies.
Market intelligence group Greenwich Associates interviewed 90 large Western European corporates in the UK and continental Europe, just two months before the EU referendum, with it revealing that most executives think that a European exit would be a disorderly and potentially volatile process.
The study revealed that CFOs have taken even less action on other risks that they see as possible, but harder to measure and protect against than Brexit. Among such risks include significant changes in regulation effecting trade and capital mobility, decreased access to liquidity and increasing cost of funding, and the possible introduction of a withholding tax.
Earlier this month former chancellor of the exchequer Alistair Darling warned that Brexit could hit UK trade by as much as £250bn, adding that a European exit “would mean introducing tariffs and barriers to our trade and putting billions of vital trade at risk”.
“These risks are much on the mind of corporate executives, but companies have taken little or no action to mitigate them,” says Dr. Tobias Miarka, managing director of Greenwich Associates and author of EU referendum report Brexit: Is Hope a Strategy?
Alistair Darling is the keynote speaker at Financial Director’s CFO Agenda on 28 June, sharing his thoughts on the impact upon business of the UK’s EU Referendum.
Karan Lal of REL explores the impact of Brexit on working capital, and how businesses can adapt to a new economic environment in the UK
Christian Kourtis of Gowling WLG explores how regulation and taxation could damage the popularity of existing digital currencies
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Business confidence remains in negative territory at -8.7 according to the ICAEW’s Business Confidence Monitor