CFOs Going Against CEOs To Vote For Trump

Whilst CEOs are mainly staying quiet, CFOs seem to be more pro-trump


This year has seen world events take some remarkable twists and turns, and CFOs have not had an easy ride as they try to make sense of how the outcome of Brexit and the US elections could impact their bottom line.

Their main concern now is the US election, with Deloitte’s CFO Signals™ survey finding that 87% of them believe the future performance of their company depends at least somewhat on the outcome of the presidential election, many citing the increased uncertainty around international trade, government spending, and tax policies.

As a consequence of this concern, many are holding back investment. The latest CFO Global Business Outlook survey from Duke University found that, regardless of who wins, at least 33% of CFOs intend to hold back investment until they see how either candidate will govern, while 26% of all US firms said they are already delaying investment because of the election. What was perhaps most interesting about these results if how they’re planning on voting.

Before the last election in 2012, a third of Fortune 100 CEOs said they supported Republican nominee Mitt Romney. This election, 0 have declared their support for Donald Trump, with 89 out of the 100 top CEOs choosing not to support either candidate and the remaining 11 backing Democratic nominee Hillary Clinton. Meanwhile, support for Clinton among the college educated is 25 percentage points ahead of that for Trump at 59% to 34%, and 150 technology executives also wrote an open letter in July opposing Trump’s policies, including leaders of Slack and Box.

CFOs, on the other hand, appear to be standing by their man, or at least their party. Deloitte found that 74% of US CFOs consider themselves Republicans, the same number as in 2012. The number identifying themselves as independents has risen to 19%, nearly twice that of the second quarter in 2012, while the number identifying themselves as Democrats has fallen to 8% - half the level recorded in 2012. And this doesn’t appear to be a purely political decision. In Duke’s survey, 40% of CFOs said they will hold off on investment if Hillary Clinton is elected, but only about 33% said they will do same if Donald Trump is elected. Of the 26% currently delaying investment, three-quarters will continue delaying investment should Clinton win versus roughly half of firms if Trump wins. Among the majority of firms not currently delaying investment because of the election, about a quarter said they would change course and delay investment plans if Clinton was elected, and another fourth said they would do the same if Trump wins.

So what is it that CFOs know that their CEOs and other business people know that else has missed?

One likely reason for the disparity is opinions around the different candidates’ platforms on tax, an issue likely to be of far more concern to CFOs. Essentially, Trump wants to lower the corporate rate, Clinton does not. Tom Wheelwright, CEO of ProVision, a CPA firm, summed up the view of many finance leaders, arguing that, ’While Trump may be fuzzy on many of his policies, when it comes to tax policy, his plan is the clearest, most business-friendly policy we have seen in many years.’

While this may be true of tax, the bombast and flip flopping Trump has employed throughout his campaign does not suggest a premiership that will be prone to consistency, shape or form, creating volatility into the capital markets that could have dire implications for CFOs. Another potential explanation for the gap between CFOs and CEOs is the CEO’s need to look at the bigger picture, and their ability to see the wider implications of a Trump presidency and how this could affect their organization. Equally, it could simply be that CEOs are more reserved about how publicly endorsing him could go down with the public. Whatever the reason, they are going to need to get on the same page, or the level of risk they currently fear could get dramatically worse.


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