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Capital Confidence Barometer, October 2011-April 2012 - Growth - Ernst & Young - Global

Capital Confidence Barometer, October 2011–April 2012

Growth

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The shift from survival to growth continues.

Despite market turbulence, this is not 2008. Companies have strengthened their balance sheets, cuts costs and reduced overall financial risk. Our research builds a picture of corporate confidence amid market turmoil.

Growth tops the corporate agenda as half of the respondents are making growth their top priority in the next 12 months. Only 7% cite survival as an imperative — the lowest level since the barometer was first published in 2009.

What describes your organization’s focus over the next 12 months?

Corporate earnings outlook stable to positive

Continued focus on cost reduction and efficiency throughout the financial crisis has most corporates positioned for stable to growing earnings. 33% feel positive or very positive about corporate earnings potential.

Please indicate your level of confidence in corporate earnings at the global level

For those with excess cash flow in the next 12 months, nearly two-thirds of all companies prioritize investing in growth, followed by paying down debt.

If you have excess cash, which of the following will be your priority over the next 12 months?

Regulatory risk is a factor that could derail growth agendas

85% of respondents are concerned that mounting regulatory pressures across a number of areas could potentially impede growth. Banking and financial reform are viewed to have the broadest potential impact across all sectors. Tax and environmental regulatory frameworks are of next highest concern.

What areas of regulation pose the most significant risks to growth and profitability for your organization over the next 12 months?



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