In a surprise move, the U.S. announced a pause on the implementation of new tariffs for most companies—offering a temporary buffer from the sharp increases many had been bracing for. Still, the underlying threat remains: if enacted, the proposed tariff hikes could push effective tariff rates (ETRs) to about 20% for EU goods and potentially 104% for some Chinese imports, according to Fitch Ratings. Other Asian economies, including Vietnam, also remain exposed.
If enforced, the result would be “higher consumer prices and lower corporate profits in the U.S.” according to Fitch. “Higher prices will squeeze real wages, weighing on consumer spending, while lower profits and policy uncertainty will act as a drag on business investment.”
Said famed corporate valuation expert and NYU professor Aswath Damodaran in a blog post: “I don’t believe that it is premature to put the tariff news and reaction into the crisis category. It has the potential to change the global economic order, and a market reaction is merited.”
Even with the pause in place, the moment demands strategic action. Companies now have a narrow window to evaluate their exposure, strengthen plans, and reposition. Those with diversified strategies and real-time planning capabilities are positioned to adapt. Others must act fast.
“There is no excuse for only having one plan in place and assuming it will all follow the script,” says Jack McCullough, president and founder of CFO Leadership Council. “Scenario planning is pretty easy these days—the technology makes it so.”
So what should companies be doing now? Experts point to five immediate strategic priorities:
1. Reinforce investor confidence.
Rapid response and transparency will matter more than perfect answers. Boards should ensure their companies avoid information vacuums that can damage market credibility. “Companies will never have all the answers at a time like this when things are unfolding quickly,” says Moira Conlon, founder and CEO of Financial Profiles.
However, “the more information you can share about your [company’s] situation and response, the more favorably investors will view you as a credible management team,” Conlon says. She recommends developing bull, bear and base case models based on current facts. With earnings season approaching, “Investors and analysts will be looking to management commentary and the Q&A to get a pulse on how to build [their] models and think about investments,” she adds. CFOs should be conservative in guidance, and explain the assumptions.
2. Reassess supply chains and sourcing models.
Tariff volatility exposes weaknesses in global sourcing. “Now’s the time to have candid conversations with key suppliers, renegotiate terms or even explore local alternatives to avoid potential disruptions,” says Joseph Esteves, CEO of Maine Pointe.
Companies should also evaluate their financial resilience. “Ensure cash flow is strong and consider securing lines of credit or diversifying risks where possible,” Esteves says. “That two-pronged approach—securing the supply chain and fortifying financial flexibility—helps businesses stay agile and be better prepared for what comes next, whether it’s trade shifts, tariffs or other unexpected challenges.”
3. Maintain real-time visibility into liquidity.
As financial flexibility is a high priority, the key question for all companies, with or without treasury functions, is, “How much cash [on hand] is enough?” says Bruce Lynn, managing partner of the Financial Executives Consulting Group. The answer is relative and requires constant comparison to other parts of the company’s financial picture, like its level of current liabilities and long-term debt. Knowing the answer to that cash question only once a month—at the end of the accounting cycle—is unacceptable, says Lynn. “Today’s environment puts a premium on cash forecasting more frequently.”
4. Leverage technology.
Companies that can model different market scenarios and respond quickly will be better equipped to navigate volatility.
“CFOs are coming to us and asking, ‘What’s my position around working capital? How do I look at my DPO to ensure I’m putting liquidity to work versus letting it sit dormant at the risk of changing volatile currency exchange rates?” says Melissa Di Donato, chair and CEO of Kyriba.
The demand for better forecasting is widespread: In the latest Association for Financial Professionals survey, more than 60 percent of treasury professionals cited cash or liquidity forecasting as the most challenging task they face. Predictive analytics can provide clarity on capital allocation and help model rate or policy changes, Di Donato notes.
5. Manage long-term risk.
Crisis leadership isn’t only about mitigation—it’s about vision. Boards need to examine how today’s disruptions could shape tomorrow’s risks and opportunities.
“Understanding probabilities and planning accordingly is essential,” wrote Brian Olson, a CFO coach with Chief Executive Coaching, in a column Monday.
Clearly, short-term firefighting isn’t sufficient. The companies that emerge stronger will be those that identify and act on long-term opportunity amid today’s turmoil.
Simply managing through adversity shouldn’t be the sole focus—these disruptions can also present avenues for strategic growth, Olson notes.
Companies can’t control tariffs, interest rates, or macroeconomic shocks—but they can control their internal response. And in weighing tradeoffs, businesses should keep long-term value creation front and center. “Resist the urge to cut costs today if they will lessen value tomorrow,” cautions McCullough.
