The one word CFOs often won’t say

Headwinds. Economic uncertainty. Deceleration. Obstacles. Challenges. Six seven. These are just some of the words executives use to avoid uttering that big, scary R word: recession.

For many finance professionals, recession is the Voldemort of the corporate finance world. Just saying it out loud might feel risky, as if speaking it could summon the Dark Lord. And maybe they’re right. When President Trump didn’t rule out a recession in the US in March 2025, the Dow fell almost 900 points.

With these sorts of euphemisms, “you can take the sting off of it a little bit,” Dennis Gannon, VP of research at Gartner, told CFO Brew.

While there is no globally recognized definition of a recession, according to the World Economic Forum, in 1974, US economist Julius Shiskin defined a recession as “two consecutive quarters of declining growth.” These days the US uses a slightly more flexible definition from the National Bureau of Economic Research: “a significant decline in economic activity that is spread across the economy and that lasts more than a few months.”

In Q1 2025, 124 companies mentioned recession in earnings calls, according to Seeking Alpha. This was while the S&P 500 was down 4.3% and the Nasdaq was down 10.5%. Then in Q2, as markets rebounded, only 16 firms used the word.

“The lack of mentions of an economic downturn could reflect a growing sense of confidence among the firms, amid easing inflation and stable consumer spending,” Seeking Alpha News Editor Sinchita Mitra wrote last August. “However, it could also be a shift in corporate messaging to avoid using alarmist messaging amid persistent economic challenges.”

Trying to predict an unpredictable future is an unenviable task that “inevitably falls on the CFO,” Sandra Sucher, a professor of management practice at the Harvard Business School, told CFO Brew. So it might not be about obscuring as much as it is about hedging.

“It’s easy to look at the language that’s used and to immediately assume that [CFOs] are trying to hide something,” Sucher said.

Recession is a word that has “a big shiny siren on top of it,” as Gannon put it. And “there’s definitely a downside to being too transparent,” according to Michael Maslansky, CEO of language strategy firm Maslansky + Partners. Such as:

Upending stock prices. CFOs are essentially the Federal Reserve chairs of their own companies. And the Fed has to be boring or else markets will have a meltdown. For CFOs, one thing said the wrong way could trigger a stock sell-off.

“The CFO is typically very invested in projecting calm,” Gannon said. “They’re trying not to create a herd reaction or panic reaction, so they’re choosing those words very carefully.”

And recession is usually one of those carefully used words.

“When you talk negatively about the economy, it’s not going to help your stock, for the most part,” Maslansky said. “There is a predisposition to stay away from being too bearish about where the economy is going to take things.”

There are exceptions to this, of course, he said. If a company outperforms competitors during a time of economic downturn, the CFO might actually use the word to highlight how well it’s navigating the challenges. And if the business isn’t faring well along with everyone else, it could be a way of pushing the responsibility for the decline away from leadership. “Use it as a way of hedging: It’s not our fault. Everybody’s dealing with these things,” he suggested.

Agitating the Trump administration. It wouldn’t be 2026 without businesses having to factor the President’s feelings into their strategies.

He has a vested interest in the economy seeming strong, and appears to lash out at those who suggest otherwise. President Trump fired the commissioner of the Bureau of Labor Statistics in August when the agency reported low job numbers. He has also repeatedly attacked the Fed chair for not lowering interest rates. Companies would like to avoid being targeted themselves.

“If you make a statement about the economy, are you criticizing the Trump administration?” Maslansky said. “How do you make sure you’re communicating in a way that is not poking the bear?”

Overstepping. CFOs aren’t supposed to declare recessions. That’s the job of the government, according to Sucher. They have a fiduciary responsibility to speak on market conditions; forecast the economic environment; and identify weak sales, increased costs, and tariff challenges.

“Pity the poor CFO,” Sucher said, “who has got fiduciary duties to present the world as they see it, so shareholders and other stakeholders can make investment decisions, and who nonetheless knows that whatever it is that they say is likely possibly to happen and likely to not happen.”

“They’re not global economists,” Maslansky added. “They probably can’t do any better in predicting the economy than the economists, and the economists can’t predict the economy.”