As CFO, you’re facing immense pressure to reduce costs while helping the business stay on track for growth. That's why the power of portfolio optimization has never been more important to the bottom line. PwC’s 2023 study on divestitures shows that S&P 500 companies acquired businesses at a rate 4.4 times greater than they divested assets, up from 3.7 in the prior five-year period. However, companies that both acquire and divest outperform their industry index during the years following the transaction. Their winning formula? A proactive portfolio review process combined with a willingness to consider divestitures and acting with speed can help generate greater total shareholder return. Not many companies have all three components in place, but when they do the probability of a positive total shareholder return is 99.5%.

What’s important to CFOs in 2023

Navigate economic uncertainty

Enable growth

Take action on ESG

Accelerate transformation

Cultivate finance talent

Build trust and purpose

Growth in leaner times is possible, but CFOs are likely to be much more selective about spending, turning to advanced scenario planning and modeling to inform strategic capital decisions. Many CFOs say they’ve balanced price increases with long-term customer demand, fine-tuning their compensation strategies and even investing in selective, strategic hiring. M&A may be another option, but it’s critical to calibrate variables like potential supply chain and resource risks in their valuation models when assessing potential advantages.

Enable growth

— PwC Pulse Survey, November 2022

of CFOs say they’re confident they can achieve near-term growth goals.

Enable growth

68%

cFo

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Despite economic headwinds, finance leaders aren’t losing sight of their long-term growth goals. But with less margin for error, it’s critical to invest more selectively with an eye toward achieving long-term goals. CFOs can work closely with their colleagues across the C-suite to adjust budgets and revisit pricing models.

Looking ahead:

How dealmakers can capitalize on market volatility

Why you should maintain growth vectors, even during periods of capital discipline

Environmental, social and governance (ESG) issues continue to dominate the list of priorities for business leaders. Many CFOs are concentrating their ESG efforts around gathering the right data and creating consistent reporting metrics and frameworks in preparation for new SEC disclosure rules. By shaping policies, procedures and controls for climate data collection, CFOs can add rigor to help the business achieve investor-grade ESG reporting and begin to integrate financial and nonfinancial reporting ecosystems. They can also look at how their companies can make progress on decarbonization efforts by taking advantage of credits and incentives included in the Inflation Reduction Act.

Take action on ESG

CFOs are well-positioned to help their organizations take action on corporate sustainability goals, take advantage of benefits and comply with disclosure requirements. Finance leaders can determine what systems and processes must be put in place, what data must be collected and analyzed, and which stakeholders should be involved.

Looking ahead:

— PwC Pulse Survey, August 2022

of CFOs are establishing policies, procedures and controls for climate data collection

take action on esg

40%

cFo

SEC climate disclosures and your company

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Facing a myriad of disruptors, companies in every industry are making strategic decisions aimed at remaining competitive in the market and with their people. Digitization, standardization and automation will be critical as businesses focus on solving problems for their customers in innovative, lasting ways. Many CFOs are investing in technologies like cloud and analytics to drive growth, but they’ll also need people with specialized skill sets. A finance team’s analytical skills and ability to quickly unlock insights from financial data are as important as the digital tools to inform strategic decision-making.

Accelerate transformation

of CFOs say they plan to accelerate digital transformation using data analytics, AI, automation and cloud solutions.

— PwC Pulse Survey, August 2022

Accelerate transformation

53%

cFo

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CFOs can lead the way on business process standardization and digitization in the finance function and beyond. Enterprise digital transformation needs advanced analytics, artificial intelligence applications and cloud technology, the backbone of advanced financial tools. Finance leaders can plan for the cost of digital assets, as well as digital upskilling and mentoring, as people functions combine with tech.

Looking ahead:

CFOs have consistently cited talent attraction and retention as a serious risk — even more than their C-suite peers. No surprise when finance chiefs are navigating a complex, constantly changing environment in which their organizations are demanding greater insights to drive quick decision-making and enterprise value. In the face of a finance talent crunch, demand is high for those with broader skill sets, particularly in data analysis and forecasting — and the technologies that power them. Having the right mix of skills within their team can help CFOs drive growth goals, perform more accurate analysis and scenario planning, and increase enterprise efficiency and effectiveness.

Cultivate finance talent

CFOs recognize that business models have fundamentally changed — and with them, the role of the finance function. Despite economic headwinds and a tight financial labor market, CFOs may invest in targeted upskilling or even selective hiring to deepen finance’s capabilities in modeling, analysis and scenario planning. As demand drivers become more volatile, strategic CFOs can position finance as a nimble business partner that can work in lockstep with other business functions.

Looking ahead:

— PwC Pulse Survey, November 2022

of CFOs say in the next 12 to 18 months they plan to hire in specific areas to drive growth.

Cultivate finance talent

57%

cFo

Is your finance function ready for the next wave of transformation?

More than tech: Why finance transformations should start with people first

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of CFOs say their top priority is building predictive models and scenario analysis capabilities.

— PwC Pulse Survey, August 2022

Navigate economic uncertainty

47%

cFo

Facing prolonged market instability, CFOs continue to prioritize building predictive models and strengthening scenario analysis capabilities to gauge the impact of the volatile business environment on their bottom line. And yet, despite a collision of economic factors like high inflation and rising interest rates, CFOs remain optimistic that they can bolster enterprise resilience and stay on track toward long-term growth goals.

Navigate economic uncertainty

Policy on Demand: Legislative insights and regulatory developments

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CFOs should prepare their companies for potentially complex risk scenarios, including looming recession, inflation, geopolitical unrest and increased cybersecurity vulnerabilities. By leaning into more agile, data-driven scenario planning, they can model out the potential impacts of market risks. They also have the opportunity to play an active role in driving business agility through collaboration and partnering across functions to position the enterprise to respond to new laws and increasing regulations.

Looking ahead:

Trust is the new business currency for CFOs, influencing loyalty and buying decisions for customers, as well as employee retention. But it can’t be taken for granted. Today’s CFOs are expected to build trust with their stakeholders to deliver better, sustained outcomes — and lead on both business and societal issues. When senior leadership aligns around their customers’ and employees’ top priorities, they can help focus the entire organization on the most important trust initiatives. CFOs also have a unique opportunity to tie fiscal responsibility to transparency. Meanwhile, with heightened concerns about cyber attacks and growing demands for transparency sparked by a new law and an SEC proposal, CFOs say their organizations are also enhancing their ability to manage cyber risk.

Build trust and purpose

When it comes to transforming trust into action, CFOs have found themselves at the intersection of purpose and practice. Company-wide efforts—particularly regarding transparency, accounting and reporting insights—are now considered to be within the CFO’s expanding domain of accountability, while areas like cybersecurity and data privacy need funding to provide preemptive action.

Looking ahead:

2023 Global Digital Trust Insights: A C-suite united on cyber-ready futures

Learn more:

— PwC Consumer Intelligence Series on Trust, June 2022

of business leaders say customers highly trust their companies when only about 30% do.

Build trust and purpose

87%

Six topics shaping the finance leader agenda

Why it’s time to take a different view of deals

Dig deeper into PwC’s 2023 Trust Survey and explore our trust playbook for leaders

Learn more:

cFo

Finance 2025 podcast: Transforming with a people-first mindset

1. Navigate economic uncertainty

2. Enable growth

Content

3. Take action on ESG

4. Accelerate transformation

5. Cultivate finance talent

6. Build trust and purpose

Creating value amid technology disruption

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Creating value through trust: PwC's 2023 Trust Survey

Policy on Demand: Legislative insights and regulatory developments

What you really need to know about Scope 3 emissions and your business

Finance transformation solutions to create value

Audit quality: the bedrock of building trust

Read more about navigating tax, risk and regulation.

PwC Pulse Survey: Bracing for recession, CFOs build resilience

Inflation Reduction Act and your path to decarbonization

PwC US makes $1 billion investment to expand and scale capabilities in AI

Bridge the trust gap on your transformation journey

The next leap in value creation: How Game Changers are defining the future of business

Audit quality: the bedrock of building trust

Learn more about the value in divestitures in PwC's recent study

Divestitures are an underused lever for creating value in uncertain times, and our winning three-part formula can help set you up for success.

The power of portfolio optimization

Find out how to make comprehensive M&A integration a success

Large, transformational deals that truly create value share key traits, such as coordinated integration, clear goals, talent retention and change management.

Have you cracked the code on M&A?

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