Looking ahead to 2025, CFOs face a defining moment. From growing regulatory complexity to heightened global risks, the challenges are significant, but so are the opportunities. Here, we set out the key issues that will shape how finance leaders safeguard, optimize, and grow value for the future.
As 2024 draws to a close, finance leaders face a rapidly evolving risk environment that shows no signs of slowing in 2025. Geopolitical uncertainty, including the possibility of significant trade disruptions, continues to unsettle global markets.
Climate-related disruptions, from floods to wildfires, are accelerating, presenting operational and financial challenges for businesses worldwide. In 2024, heatwaves in India, Thailand, and Bangladesh – as well as fatal floods in China and Pakistan – came at a time when the World Meteorological Organization (WMO), the UN’s weather agency, warned that climate change is causing major repercussions across Asia.
At the same time, digital transformation is advancing, intensifying cybersecurity threats. As organizations adopt AI and other technologies, finance leaders must prioritize innovation while safeguarding data integrity and security.
In 2025, CFOs will play a pivotal role in bridging risk and resilience. They must act as connectors, integrating risk intelligence across teams and guiding executive teams to make informed decisions. Embedding risk insights into financial strategies will be essential to building organizational resilience in an uncertain world.
In 2024, many organizations grappled with a familiar challenge: being data-rich but insight-poor. Despite advances in generative AI, many businesses struggled to transform raw data into actionable strategies. Unclear governance, fragmented systems, and ambiguity around data ownership contributed to this gap.
Looking ahead to 2025, collaboration between CFOs and chief data officers (CDOs) will be essential. Together, they must define clear responsibilities, establish robust governance frameworks, and ensure data is clean, accessible, and secure. By addressing these fundamentals, businesses can unlock the full potential of their data to drive faster, smarter decisions.
Businesses have faced a tough road to profitability in 2024. Persistent inflation, high interest rates, and supply chain disruptions drove up costs, including for raw materials. At the same time, consumer spending remained cautious, limiting the ability to pass on price increases.
Many of these pressures are set to continue into 2025. While inflation is moderating, it remains above historical norms, and central banks are staying vigilant. To adapt, businesses will need strategic financial leadership, with a focus on scenario planning and forecasting to navigate economic uncertainty.
Cost optimization will remain a priority. Investments in technologies that streamline operations and reduce overheads will be critical to maintaining profitability and improving margins in a challenging environment.
“Despite a pushback against such regulations in some regions, extreme weather events and rising stakeholder pressure will likely fuel calls for stronger action and oversight.”
Over the past year, companies have struggled to source skilled talent amid rapid technological advances. Workforce capabilities have struggled to keep pace with the speed of AI development. At the same time, demographic trends – including aging populations and tighter immigration policies – are shrinking the available talent pool. These pressures are unlikely to ease in 2025 as technology evolves and regions like the EU contend with an aging workforce. The population aged 60 or over is rapidly growing in the European region: in 2021, there were 215 million, and it is projected to reach over 300 million by 2050.
For CFOs, the challenge is amplified. The finance function demands highly specialized expertise and finance leaders often oversee IT and HR teams with similar skill requirements. To attract and retain talent, CFOs must look beyond competitive pay. Offering a forward-thinking, innovative workplace that prioritizes growth, learning, and clear career progression will be key to securing and retaining high-potential employees.
Amid global economic uncertainty, optimizing portfolios and restructuring operations are critical for productivity and growth. Businesses will focus on acquiring technology-driven assets to stay competitive while divesting non-core operations will unlock capital for reinvestment in high-growth areas. CFOs will be central to identifying opportunities that align with strategy and deliver future value.
Operational restructuring will drive efficiency. Companies will look to outsource non-essential tasks to focus on strategic strengths and tap into specialized expertise, especially as technology evolves and talent shortages persist. Nearshoring and reshoring strategies will also continue to be important as businesses seek to mitigate geopolitical risks and strengthen supply chain resilience.
Sustainability reporting is gaining momentum, with Europe leading the charge. The EU’s Corporate Sustainability Reporting Directive (CSRD), effective from 2025, is set to shape global standards, pushing businesses towards greater transparency on sustainability performance. Meanwhile, further initiatives, such as the Corporate Sustainability Due Diligence Directive, are already in development.
Despite a pushback against such regulations in some regions, extreme weather events and rising stakeholder pressure will likely fuel calls for stronger action and oversight. In this environment, CFOs can reposition the regulatory response from a box-ticking exercise to a core business capability. This approach will not only help meet stakeholder expectations – from customers seeking action to investors demanding visibility on long-term risks and opportunities – but strengthen strategic resilience.
In 2025, the pursuit of economic sovereignty, as well as protectionist policies, will challenge cross-border operations, driving up costs and creating regulatory tensions. CFOs can play a key role in navigating these shifts effectively, including evaluating the financial implications of localization against maintaining global operations.
Scenario planning is key to preparing for geopolitical outcomes, including putting in place the financial ‘buffers’ needed to manage any unexpected costs. Advanced analytics can provide critical, data-driven insights into geopolitical trends so that decisions are made based on long-term intelligence.
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