A report from Safeguard Global, has found the despite confidence in global hiring, noncompliance and geopolitical disruption are keeping CFOs from pursuing global growth.
According to the report, “The Global Hiring Confidence Series: Untangling the CFO Paradox Between Confidence and Restraint,” which surveyed 400 CFOs in the US and the UK, 97 per cent of CFOs are interested in global hiring, and 96 per cent believe their company is prepared to hire workers globally.
CFOs are also highly involved in global hiring, with two-thirds involved in all final decisions. Given their clear ownership of financial oversight, it’s unsurprising that 79 per cent of CFOs identified cost savings as the most important metric when hiring globally. However, their heavy focus on costs may be downplaying the complex nature of hiring in a specific country, leading to potentially high-risk decisions that ultimately undermine their global talent strategy.
This disconnect highlights a broader CFO paradox between high confidence and significant growth challenges, causing CFOs to pause expansion. Facing geopolitical conflict, an ever-changing compliance landscape, and economic uncertainty, CFOs’ global hiring actions do not match their enthusiasm.
Most notably, every CFO surveyed – 100 per cent of CFO respondents – admitted their organisation had suffered financial losses due to noncompliance when expanding globally. More than three-quarters (78 per cent) of CFOs reported losing up to $1M, and 22 per cent reported losing over $1M in noncompliance-related losses when expanding globally. Breaking it down across countries:
- 30 per cent of US CFOs reported losses of $1M USD or more.
- 14 per cent of UK CFOs reported losses of $1M USD or more.
- 70 per cent of US CFOs reported losses of up to $1M USD.
- 86 per cent of UK CFOs reported losses of up to $1M USD.
While financial losses from noncompliance are a major reason organisations pause global hiring, the report also revealed that headwinds from geopolitical conflict have contributed to their hesitation, as they’ve increased budget to support employee relocation (38 per cent), delayed or reduced hiring in affected regions (36 per cent), and increased contingency or buffer budgets (36 per cent). Additionally
- Two in five (40 per cent) CFOs said geopolitical disruption has made their organization more cautious about hiring globally.
- More than a third (38 per cent) reported that it has hindered their company’s ability to expand.
- Nearly one in five (19 per cent) have relocated an existing employee to another country due to geopolitical conflict in the last 12 months.
These challenges have contributed to an overall reluctance among CFOs to actively pursue global expansion. More than a third (37 per cent) of CFOs said their organisation is prioritising domestic hiring over international hiring, planning to decrease cross-border hiring, or both. Just 22 per cent of CFOs said their organisation has plans to hire globally in the next six months.
Specifically, CFOs across both countries identified a variety of situations that created operational difficulties during global expansion. The top challenges were:
- Making a first hire in a new country
- Testing hiring in a new country before deciding whether to expand there
- Managing workforce changes linked to an acquisition, merger, or restructure
- Supporting short-term, project-based, or seasonal hiring across countries
- Fixing or reviewing an overseas employment arrangement because of compliance concerns
“The challenges CFOs face in managing global hiring – from both inside and outside their organisations – are only becoming more complex. While they’re confident in their ability to manage cross-border hiring and capitalise on global opportunities, many may underestimate the resources needed to navigate the realities of international employment,” said Florence Cazemajou-Flint, chief financial officer, Safeguard Global. “That’s the CFO confidence paradox in a nutshell: confidence is high, but execution remains difficult. To bridge the gap, CFOs need more than confidence – they need the right support to simplify compliance, reduce risk, and scale global hiring with certainty.”
When asked what would enhance CFOs’ ability to handle the complexities of global hiring, the top three responses were: help with local contracts, payroll, or benefits; clear, country-specific compliance guidance; and the ability to achieve faster onboarding timelines. Support and guidance from in-country global employment experts can reduce the challenges of global hiring and help CFOs translate their confidence into action.
Download the full report to learn more.
