How companies are reacting to the liquidity crisis

Given recent developments in the market place, we've all been a bit busy trying to figure out how to successfully navigate through the market. I've recently been working with my colleagues to produce a short-term podcast series to help finance executives read a pulse from the broader membership.

As a business best practices research firm, we have the opportunity to speak to multiple financial executives within a week. We, thus, are leveraged to provide feedback on how executives are reacting to this market.

Here are some topline results:

• Treasurers are applying a 20% cut in their liquidity plans
• 40% of companies have moved exclusively to government securities and insured deposits. However, most are maintaining diversified portfolio including money market funds.
• CFOs have been spending more time with their Board of Directors this week to discuss:
  
  • Evaluation of their Capital Structure Policy. As companies review their liquidity analyses using more conservative models
  • Evaluation of their suppliers. Companies are concerned that some of their smaller suppliers might be having difficulty. Companies are undergoing comprehensive audits and evaluating their suppliers.
    

Listen to the podcast here.
Sign-up for the podcast on itunes.
Access the archive of Capital Market Roundup podcasts.

About the Corporate Executive Board
The Corporate Executive Board creates communities of functional executives. In my case, I work with finance executives including CFOs, Controllers, Heads of Internal Audit, and Treasurers. We are an executive education firm that provides these functional executives best practices, decision support and tools to help manage their workflow and their functions.