Looking ahead to 2023

Bellas & Wachowski - Chicago Business Lawyers

2023 Business Outlook

2022 started out with the hope of a recovery from the pandemic but ended with a recession.  With the advent of 2023 we are left to ponder on what is ahead for businesses in 2023.

It’s the Recession, Stupid:   The war in Ukraine has affected the world economy which was struggling with recovery after the pandemic.  Interest rates have increased which has adversely affected the real estate market and businesses which are facing higher operating costs and higher costs for loans.  We may see more businesses shut down because of the increased costs or an inability to pay off their loans.   It is doubtful that we will seen interest rates rise to the levels we saw in the late 1970’s and early 1980’s.   I recall thinking I was fortunate to get a mortgage rate of 13.5% on my first home purchase in 1979!   Businesses will need to carefully monitor their cash flow and receivables.

The future of CryptoCurrency:  Consumer confidence in these volatile currencies has waned. There are many problems facing the entire cryptocurrency which portends a troubled future.  The government is looking more deeply into regulating the industry as a result of the collapse of FTX and Terra.  The SEC has taken action to regulate the cryptocurrency market and are requiring companies to disclose their investments in cryptos.

What is ESG and what does it mean for your business:   Environmental Social and Governance (“ESG”) investing refers to a set of standards for a company’s behavior used by socially conscious investors to screen potential investments.   Larger businesses and investment funds are seeking to meet investors’ expectations that their business and investment vehicles do not engage in risky or unethical practices.   Small businesses are not facing this issue, but it is something that every business should consider.

  • ESG is becoming increasingly important to investors.
  • Customers are also becoming more interested in sustainable products and services. A study by Nielsen found that 66 percent of global consumers are willing to pay more for sustainable goods.
  • Lastly, millennials have become conscious of ESG and are looking for employers who have a strong commitment to sustainability.

Duty to Protect Customers:  As email and text scams proliferate, so has the awareness of these scams by businesses.   Banks must look to protect their customers from fraud.  Banks will become increasingly responsible to protect customers if the bank has reasonable grounds for believing that those instructions may be an attempt to misappropriate a customer’s funds.  In effect it is a duty to protect customers from themselves.  This office has been successful in representing victims of fraud (such as “catfishing”) by bringing claims against financial institutions.  Illinois has laws which require financial institutions to be aware of senior financial abuse.   This area of law is developing and we will see more actions to protect consumers – and not just seniors – from fraud and theft.

HAPPY NEW YEAR!   Notwithstanding the outlook, we always take the time at this time of year to wish each other a happy new year.   We wish all of our clients and friends a healthy and prosperous new year.