Navigating Uncertainty in 2025 and Positioning for What’s Ahead

By Jennifer Cho

Dear Partners, Clients, and Friends of FLG, 

As 2025 comes to a close, I’ve spent time reflecting on the year—both as my first year serving as Managing Partner of FLG and as a period of meaningful change across the broader business landscape. It was a year defined by listening, sharpening priorities, and strengthening our firm while navigating an operating environment that tested resilience across industries. 

2025: Uncertainty, Discipline, and CFO Leadership 

From a market perspective, 2025 was less about a single macro theme and more about sustained uncertainty. Planning horizons shortened, assumptions shifted quickly, and leaders placed renewed emphasis on liquidity, margin protection, and execution discipline. 

• Trade policy and geopolitics: Ongoing tariff uncertainty, particularly in consumer-facing and manufacturing businesses, combined with continued geopolitical conflicts to create volatility in costs and supply chains. The most consequential impacts were pricing pressure, working capital strain, and margin management challenges.
   

• U.S. policy shifts: The return of a Trump administration influenced business sentiment, particularly around immigration and regulation. Tighter labor availability in technology, healthcare, and manufacturing accelerated management focus on productivity, automation, and alternative operating models.
   

• Capital markets: Capital remained available but selective. Investors and lenders continued to reward profitability, cash flow durability, and clear value-creation plans over growth alone. 

Across these dynamics, the importance of experienced CFO leadership was evident, supporting management teams and boards as they assessed exposure, adjusted forecasts, and made decisions requiring both speed and judgment. 

Firm Progress in 2025 

Alongside these external forces, 2025 was also a year of progress for FLG Partners.  

One of the most meaningful developments was the expansion of our partnership with the addition of Andrea Persily and Jeff Barker. Their experience, leadership, and industry expertise further strengthen our ability to support CEOs and boards navigating transitions, transactions, and growth. 

We also made deliberate progress in how we think about the role of AI within a CFO advisory firm.  

Rather than adopting tools for novelty’s sake, we focused on where AI can responsibly enhance analysis, efficiency, and insight, while preserving the governance, independence, and judgment our clients expect. This remains an area of active exploration as we look ahead.  

2026 Outlook: Structural Shifts Beyond the Cycle 

Looking to 2026, several themes are likely to shape decision-making for management teams and boards. While AI adoption will remain a central focus, it is one of several forces redefining how capital, talent, and strategy intersect. 

• AI moves from adoption to economic impact: AI will increasingly be treated as core operating infrastructure rather than a set of tools. The challenge will be translating investment into measurable outcomes—margin improvement, cash flow, productivity, and growth—while establishing appropriate governance, controls, and accountability. As automation expands, the premium on leadership judgment and change management will rise, not fall. 

• Capital markets and a reopening IPO window: Entering 2026, capital markets appear more constructive. With interest rate expectations stabilizing and public market valuations showing greater discrimination, the IPO market is likely to reopen selectively, particularly for companies with scale, durable growth, and clear profitability narratives. This will place renewed emphasis on readiness: financial reporting rigor, forecasting credibility, and equity story discipline. 

• Continued investor focus on quality: Even as markets improve, investors are unlikely to abandon the lessons of the past few years. Capital will continue to favor companies with strong cash conversion, resilient business models, and credible paths to value creation. M&A activity is expected to increase, but with heightened scrutiny on integration execution and returns. 

• Productivity, labor, and operating model evolution: Labor constraints and cost pressures will continue to push companies to rethink operating models through automation, organizational redesign, and selective globalization or reshoring. Finance leaders will play a central role in evaluating trade-offs and pacing change.

Closing 

If 2025 was about navigating uncertainty and constraint, 2026 will be about converting structural change into sustainable performance. The organizations that outperform will not be those that adopt the most technology, but those that apply it with clarity of purpose and financial discipline. 

I am grateful to our clients for the trust they place in FLG Partners and to our partners for the rigor and professionalism they bring every day. I wish you a restful holiday season and a strong start to the year ahead. 

Warmest regards, 

Jennifer