42% of finance leaders across the Middle East are proceeding with investments in spite of referendum shock

Although finance directors have admitted June’s EU referendum result created an uncertain economic environment, new research from Oracle reveals EMEA businesses will continue to invest, and chase opportunity and growth. Companies know they cannot afford to wait-out today’s uncertainty if they’re to remain competitive and take market share.

Oracle’s ‘Stepping into the Unknown’ study set out to assess how the Brexit vote and an uncertain future are affecting business strategies, as well as how these conditions are shaping companies’ expectations of their finance leaders.

Caught by surprise

New research from Oracle reveals Middle Eastern businesses will continue to chase opportunity and growth. Companies know they cannot afford to wait out today’s uncertainty if they are to remain profitable, and are leaning on CFOs to help them invest strategically and find success.

Finance leaders expect to see significant changes to their competitive landscape under these conditions. 40% believe more organizations will struggle and go out of business, while a considerable 69% expect there will be more M&A activity and consolidation.

Waiting not an option

30% of organizations admit they did not expect the results of the EU referendum and are now playing catch-up. An even larger proportion (41%) say their forward planning has since become more complex and uncertain.

However, while organizations accept that the future is uncertain they understand that an uncertain market is also ripe with opportunity and plan to capitalize on changing conditions where possible.

42% say they plan to invest in the business if they see a strong business case, even if they are being more cautious, with almost one third (29%) committed to making major investments. This is compared to just 22% that are restricting spending to the bare essentials.

Laurent Dechaux, Vice President, Digital Finance at Oracle EMEA added: “Uncertainty doesn’t stop market disruption. If anything it opens up new opportunities for strategic movers. Some of today’s most successful companies launched in the wake of the 2008 financial crisis, jumping on changes in consumer habits and implementing processes that were agile enough to adapt as they grew.”

Leaning on the CFO
Companies are turning to finance leaders to help them identify and pursue opportunities in a post-Brexit market.

53% of finance leaders say uncertainty has put finance in the spotlight, with 56% saying their role now predominantly involves advising the business on achieving its growth goals. Similarly, 61% say their role is more focused on forward planning than ever.

CFOs also recognize that a more uncertain environment demands better planning and greater flexibility. 48% of finance leaders are planning for more potential scenarios simultaneously, and 57% are spending more time on forward planning and forecasting than last year.

Middle Eastern business leaders understand that uncertainty doesn’t stop market disruption. If anything it opens up new opportunities for strategic movers. Some of the world’s most successful companies launched in the wake of the 2008 financial crisis, jumping on changes in consumer habits and implementing processes that were agile enough to adapt as they grew

Dubai Gazette