The Economy

CFO’s Top European Stories of 2012

The euro crisis, the LIBOR crisis, and the debt crisis were popular features in 2012. But the top stories were about how to be a great CFO heading ...
Andrew SawersJanuary 8, 2013

Since we launched our CFO European Briefing newsletter back in April (if you don’t already receive it, you can subscribe here), our London desk has been busy generating articles that have a distinctively European slant. The euro crisis and the state of the economy have featured prominently.

Not surprisingly, however, many of the issues that are top concerns on the European side of the Atlantic are exactly the same things that bother CFOs on the American side — not least, how to be a better CFO.

Below is a month-by-month selection of some of our best-read and most-commented-upon articles — plus a few of our own favorites.

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April — How to Add M&A Value: Pay Cash, Go Hostile.” It’s still true that most M&A deals destroy value. But those that don’t wipe out value actually create more of it than the others lose. An academic study highlighted key tips to making your M&A successful.

May — Europe’s Debt Crisis: Apparently, It’s All Your Fault.” With European corporates sitting on some €2 trillion in cash, politicians and think tanks took turns criticizing big business for not spending our way into recovery. One reader commented that corporates should get tax breaks to lend to small and mid-size businesses, since the banks seem unwilling to do so.

May — What Makes a CFO Great?” An ever-popular question, answered in part with another question: how much time do you, as a CFO, spend in front of customers?

June — Former NASDAQ CFO Joins London Stock Exchange.” The best CFOs are clearly in demand, globally. One of the most eye-catching CFO moves in Europe saw a transatlantic shuffle as the London Stock Exchange picked up former Nasdaq finance chief David Warren. The following month, the head of Volkswagen’s U.S. arm, Michael Lohscheller, was recruited by General Motors’s European business, Opel.

July — How to Break Up the Euro.” An award-winning paper by a leading consultancy suggested how a country such as Greece could leave the euro and go it alone. One surprising suggestion: don’t worry about not having any cash drachmas immediately available.

July — Corporations Dodge LIBOR Scandal Bullet.” With everyone getting very annoyed and immediately turning to their lawyers because of the banks’ manipulation of LIBOR rates, one question wouldn’t go away: did corporates actually suffer loss? “We have struggled to find who the net losers are, apart from the banks themselves,” said one treasury expert.

August — When Your Banker Tells You Goodbye.” Breaking up is hard to do — but as banks deleverage their balance sheets, they’re offloading loans to corporates they no longer wish to have a relationship with.

September — How Risk Management Kept the Olympics on Track. This story came out of our stateside offices rather than London: just as well, because our London desk was still busy enjoying the huge success of the Olympics. This article explained some of the risk-management issues that made that success possible.

October — The Cyber Attack on HSBC: What Happened.” For eight hours one day in October, many of HSBC’s websites around the world were brought down by a so-called hackitivist splinter group. The disruption may not have caused any real financial harm, but here’s the bad news: anyone can rent the tools needed to do a similar “denial of service” attack. Great technical skill isn’t needed, just a target — and a grudge.

November — Angry U.K. Lawmakers Confront Starbucks CFO.” Starbucks global CFO Troy Alstead may have had tax law on his side when he testified to U.K. parliamentarians as to why the company paid no corporation tax, having made $3 billion in revenue over the past three years. But he didn’t have support from politicians — or the coffee-buying public. The following month, Starbucks agreed to voluntarily pay $32 million in tax.

November — What the Best Finance Functions Look Like.” Less time collecting data, more time analyzing it? Sounds easy. Looking ahead to future skills requirements and developing plans to meet them? Not so easy.

December — How to Damage Your Share Price.” Of course, we don’t recommend that you try to damage your share price. Think of this as a checklist of what not to do. One reader commented with a quote by Warren Buffett: “Lose money for the firm and I will be understanding, but lose a shred of reputation, and I will be ruthless.”

Andrew Sawers is editor of CFO European Briefing, a CFO online publication.


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