| Confidence is high among CEOs |
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| Financial services CEOs are very confident about their business prospects to end-2006, and have a high profit expectation for the coming year. However, they share the frustrations of other business sector CEOs with regards to Ireland’s infrastructure, the cost of labour in Ireland and the tax cost of employment, writes Ann O’Connell. |
CEOs of financial services firms in Ireland are very confident about their business prospects to end-2006, with more than 85 per cent predicting growth in revenues and profits, according to PricewaterhouseCoopers’ inaugural CEO Pulse Survey.
The survey was designed in recognition of the fact that CEO views on the prospects for their own business are known to constitute one of the most reliable barometers of short term national economic performance. It was also designed with a view to providing CEOs from a variety of economic sectors with a central platform for expressing their levels of satisfaction with, inter alia, the Irish business environment and the Irish Government.
Over 200 CEOs participated in the survey, out of a sample of Ireland’s top 600 companies. Combined, respondents managed a workforce of nearly 140,000, equivalent to 7 per cent of national employment in Ireland, and turnover of €50 billion.
CEOs of financial services firms accounted for 31 of the total 211 respondents, with 12 of the total being CEOs of indigenously-owned firms and 19 being CEOs of multi-national financial services firms. Combined, financial services respondents had a combined turnover of €8.5 bn and managed close to 21,000 full-time equivalent employees.
CEOs of financial services firms in Ireland are very confident about their business prospects to end-2006, with more than 85 per cent predicting growth in revenues and profits. With the exception of the profit expectation, which is greater than for all CEOs, responses are broadly in line with those for other sectors of the Irish economy (see Table 1).
Table 1 also shows that the proportion of CEOs of financial services firms predicting growth in total employment levels to end-2006 (i.e. 61 per cent) is also considerably higher than that for all CEOs in Ireland (i.e. 48 per cent) – interesting in the context of the increased of automated services.
In terms of levels of satisfaction in the Irish business environment, the views of CEOs of Irish financial services firms mirrored those of all CEOs closely – with transport infrastructures continuing to represent a major bug bear (see Table 2).
Table 2 shows no significant differences between the levels of satisfaction of financial services CEOs with the Irish business environment and all Ireland-based CEOs.
High levels of dissatisfaction with basic transport infrastructures, the cost of labour in Ireland and the tax cost of employment are common to both.
Table 3 shows higher levels of satisfaction with the Irish Government and its policies among financial
services CEOs than among all CEO respondents.
Table 3 shows that more than more than 70 per cent of all financial services firms feel that the Irish Government is in touch with the needs of business, while 95 per cent feel that the Irish Government is more in touch with the needs of the business community than other Governments with which they are familiar. These responses are considerably higher than for all CEOs.
Finally, Table 4 presents a selection of statistics on the outsourcing experiences of financial services CEOs
in Ireland.
Table 4 shows that financial services CEOs are more likely to have outsourced one of more business functions than CEOs in other sectors of the Irish economy. Nearly two thirds had outsourced one or more business functions by end-2005 and Ireland-based companies had been the primary beneficiaries. More than 60 per cent of financial services firms which had outsourced had already derived financial gain – less than the proportion of all respondents, potentially reflect VAT issues in financial services.
In summary, financial services CEOs are very confident about their business prospects to end-2006, share the continued frustrations of other business with Ireland’s transport infrastructure and support social partnership. Their experiences of outsourcing have been favourable, but less so than for other sectors. |
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| Article appeared in the April 2006 issue.
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