The biannual survey, which collated the results of surveys run by Deloitte member firms in 15 European countries, analysed the views of 1,298 CFOs.

A quarter (25%) say they are more optimistic about the financial prospects for their company than they were three to six months ago, down from 33% in Q1 2015. Those saying they are less optimistic has risen from 18% to 23% over the same period.

Southern and peripheral European countries report higher levels of optimism than in northern countries. Over half (58%) of Ireland’s CFOs report growing optimism, with a high proportion of CFOs in Spain (54%), Poland (50%) and Portugal (47%) also more optimistic.

Optimism is weakest in northern European economies with just 14% of CFOs in both France and Norway saying they are more optimistic, followed by Germany and the UK (both 18%).

Risk appetite has also declined, with just 33% of CFOs saying now is a good time to take risk onto their balance sheets, down from 38% in Q1.

Perceptions of uncertainty have risen among CFOs with two thirds (66%) now reporting a high level of financial and economic uncertainty facing their business, up from 60% in Q1. Perceptions of uncertainty are highest in Germany (87%), the Netherlands (84%), Switzerland (75%) and the UK (71%).

Overall, 64% of CFOs expect their company’s revenues to rise in the next twelve months, with optimism higher in Ireland (84%) and the UK (72%). 

While 41% of CFOs expect their company to increase capital expenditure in the next twelve months, CFOs in Ireland (70%) are notably more optimistic than in the UK (41%).

When asked to outline their business priorities for the coming year, CFOs in 12 out of 14 of the countries responding rated cost reduction and cost control as a top three priority, with seven countries citing it as their top priority.

However, reducing costs rated as the fourth highest priority for UK CFOs, one of only two countries where it is not a top three priority, with organic expansion and introducing new products and services the two highest priorities.

Ian Stewart, chief economist at Deloitte UK, said: ‘This survey shows concerns about global growth have had a marked effect on sentiment in northern Europe, but we are seeing a rebalancing of prospects within Europe from north to south.

‘Since Q1 Europe has experienced another Greek debt crisis and concerns have increased over the strength of the global economic recovery, in particular prospects for emerging markets such as China. This has created a sense of heightened uncertainty among Europe’s CFOs.’

Deloitte’s research is available here

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