FINANCE-TV

Turnaround consultant Alvarez: “CFOs become more powerful in a crisis”

The crisis has put chief financial officers in a difficult position. While investors and creditors strongly rely on finance chiefs’ opinions, making them crucial for companies’ financial survival, the precarious state of many businesses makes them the “bearer of bad news,” as Antonio Alvarez III, managing director of turnaround consultancy Alvarez & Marsal, puts it.

 

For some finance chiefs, now is the time to shine. “Some CFOs relish this moment,” he explains. “Others shy away from it; it’s high pressure.” In this situation, “the facts must speak for themselves,” Alvarez says, to ensure that chief financial officers win over other stakeholders in their cost-cutting efforts that will eventually cut away at the company’s product range.

 

 

Ähnliche Sendungen

30.07.2012 - Turnaround-Berater Alvarez: "CFOs werden durch Krisen einflussreicher" (in Englisch)

Die Krise hat CFOs in eine schwierige Lage gebracht. Ihre Meinung ist für Investoren und Kreditgeber ausschlaggebend; das finanzielle Überleben des Unternehmens hängt von ihnen ab. Gleichzeitig werden sie durch die prekäre Situation des Unternehmens zum „Überbringer schlechter Nachrichten,“ wie es Antonio Alvarez III, Geschäftsführer der Turnaround-Beratung Alvarez & Marsal Europe, ausdrückt. Für einige Finanzvorstände ist das eine Chance, in neuem Licht zu erstrahlen. „Einige CFOs lieben diesen Augenblick“, sagt Alvarez. „Andere scheuen davor zurück; es ist ein hoher Druck.“

CFO expert Clifford: Communication is key for both cash-rich and cash-poor CFOs

Scarce bank lending coupled with strong corporate earnings and flush bond markets have created a bipolar world for CFOs: they either face a bitter liquidity crunch or huge cash piles building up on their balance sheets. Speaking on CFO Insight TV, Les Clifford, a partner at professional services firm Ernst & Young and a leader of their CFO programme, discusses their new report looking at how CFOs on both sides of the divide can cope with the challenge.

For chief financial officers at cash-strapped companies, raising liquidity is a daily challenge. This requires open communication with the lenders, Clifford says. “What you want to avoid is crisis management. Oftentimes many people try to believe that around the corner it’s going to be resolved, there’s going to be cash.” Instead of open discussions about long-term solutions with their lenders, they opt for short-termism.

However, this can be a dangerous approach, Clifford warns. “Most lenders are good at looking at the market and making their own views of these companies already,” he says. “So coming together to discuss each other’s perception can break down walls. ... Make [the lenders] a partner more than purely a lender.

Chief financial officers at cash-rich companies seem to face the easier task. However, they too must ensure that their message is being understood, Clifford says. “The question is: Are CFOs communicating their decision clearly enough to investors?” Many finance chiefs may not do all they can in this respect, leaving them vulnerable to investor backlash.

 

Johannes Müller, chief economist at Deutsche Asset & Wealth Management: “Current account deficits are at the core of the crisis.”

As Germany reflects upon the 10th anniversary of its structural reforms known as Agenda 2010, the debate about how to best get out of the crisis is going strong in many European countries. Johannes Müller, chief economist at Deutsche Asset & Wealth Management, says that the primary goal should be to reduce current account deficits. “Current account imbalances are at the core of the crisis,” he says. Müller concedes, however, that many countries in Europe are making good progress in turning their economies around.

Forensik-Experte Kiess: „Bei Verdachtsfällen nicht vorschnell handeln“

Auffällige Buchungen, merkwürdige Beraterverträge: Wenn der Verdacht aufkommt, ein Mitarbeiter könnte sich bereichert haben, bedeutet dies für CFOs Stress: „Jede Untersuchung ist eine Krisensituation“, sagt Raphael Kiess, Managing Director im Bereich Disputes and Investigations bei Alvarez & Marsal.

 

Dennoch plädiert er dafür, auch in dieser Situation die Ruhe zu bewahren. Oberstes Gebot müsse es sein, mögliche Beweise zu sichern. „Dafür muss man auch die IT-Abteilung einbeziehen.“ Welche Warnsignale CFOs erkennen sollten, um Unregelmäßigkeiten zu entdecken, wie Forensiker bei Verdachtsfällen vorgehen und wie hoch ihre Aufklärungsquote ist, verrät Kiess im Talk bei FINANCE-TV.

 

A Period of De-Globalisation

In our second session with Professor Harold James of Princeton University, CFO Insight-TV discusses implications the current crisis has on globalisation in the wider perspective. “I think we see some clear signs of a de-globalisation framework,” Professor James says. For example, the debates in Europe are typically antagonistic. Southern European countries think the north is suffocating them with calls for austerity, and northern European countries feel that those in the south are exploiting their generosity.

Turnaround-Investor Peter Mauritz: „Immer noch reger Dealflow bei Sondersituationen“

Der Turnaround-Investor Peter Mauritz weist die Vermutung kategorisch zurück, in Zeiten boomender Konjunktur nicht mehr genügend Investitionsgelegenheiten zu finden. „Der Dealflow ist rege“, sagte er gegenüber FINANCE-TV. „Sondersituationen gibt es immer. Da lösen andere Faktoren die Schieflage aus als eine schwache Konjunktur.“ Ob der Konjunkturboom zumindest die Rendite seiner Beteiligungsgesellschaft Prolimity verwässert und warum seine Investoren sich blind auf seine Arbeit verlassen – bei FINANCE-TV berichtet Peter Mauritz von der aktuellen Lage an der Sanierungsfront.