Wednesday 1st October 2014

According to research by Deloitte, the recovery of the US and British economies has fuelled the appetite for risk among chief financial officers (CFOs). The business advisory firm’s CFO Survey for Q3 of 2014 shows that the appetite for risk among these individuals has jumped to a seven-year high.

With 118 CFOs questioned as part of the research across major privately-owned businesses and FTSE 350 firms, Deloitte believes improved access to finance has also made them more open to risk.

Compared to the figure of 65% recorded during Q2, some 72% of CFOs feel that now may be a good time to increase the amount of risk which is present on their balance sheets.

Responding to these findings, Ian Stewart, chief economist at Deloitte, said: “With a resurgent US economy, good growth in the UK and plentiful liquidity, CFOs have shrugged off the effects of rising uncertainty and weakness in Europe, sending corporate risk appetite to a seven-year high.

The report also highlights that despite the positive nature of the results, CFOs report that levels of financial and economic uncertainty have risen. Compared to the score of 49% in Q2, 56% of CFOs now believe their business faces an above-normal, high, or very high degree of financial and economic uncertainty.

Authors of the report suggested that the fact that the Scottish independence referendum took place during the third quarter likely increased feelings of uncertainty. CFOs say the greatest risks facing their business relate to the risk of further policy change and uncertainty from a future referendum on the UK's membership of the European Union and the May 2015 UK general election.