Industry 360º, Volume IV

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Topic one: the credit crisis

It has been a tumultuous few months. As the financial crisis continues, there is little reason to celebrate. Much like a pandemic, bankruptcies, takeovers and bailouts have infected the financial markets around the world. And there seems to be no remedy in sight. Governments globally have supplied over US$3 trillion to stabilize the markets, yet they continue to bleed.

With ailing financial institutions getting most of the attention, it is easy to forget that the credit crisis is not solely a financial market issue. The truth is, the entire market is going to be implicated.

In the real estate industry, for example, the housing market crisis and industry consolidation are driving institutions, owners and investors back to basics. As the need for transparency becomes critical, Ernst & Young’s Global Real Estate Center is helping sovereign wealth funds, pension funds and private equity evaluate the true value of target assets. We’re also helping home builders and mortgage REITs restructure to weather the storm.

It’s been a perfect storm for the automotive industry. Demand is down, credit in the form of leasing programs has all but disappeared and liquidity in the industry has virtually dried up. Several auto makers had a plan to sustain themselves until 2010 when new technologies come online and renegotiated benefits become active. Now they are seeking a lifeline to keep them alive until that time. Our Global Automotive Center is working with clients to explore cash preservation, working capital optimization and restructuring opportunities to help them survive.

Power and utilities companies tend to weather recessions better than most, but that does not mean they are immune. Higher debt costs could seriously impact operations and prices; funding options for transactions may be scarce; and financing for capital investments will cost more. For Ernst & Young’s point of view on the matter, please visit the latest issue of Utilities unbundled (pdf) published by the Global Power & Utilities Center.

For our point of view on the credit crisis within banking and capital markets, be sure to watch for From safety to success: Stemming losses and returning to profitability located in theComing soon segment of our Banking & Capital Markets section.

Also, be on the look out for Ernst & Young’s upcoming series of articles and webcasts focusing on industry-specific impacts of the credit crisis to your bottom line.

360 ° hot topic: Climate Change and Sustainability

There is no question that restoring equilibrium to the financial markets is critically important in the short-term. However, we also need to keep our focus on an equally important long-term issue — climate change. Economic woes are grabbing our attention today. Climate change is something we need to address so that tomorrow’s generation does not have to contend with an environmental crisis. That is why we have chosen climate change and sustainability as this issue’s hot topic.

As we hear from Jan Babiak, Ernst & Young’s Global Climate Change and Sustainability Services (CCaSS) Leader, now is not the time to put a hold on climate change. In this issue’s 360˚ interview, she and Global Oil & Gas Leader Wendy Fenwick discuss the impact of climate change on businesses and the role of the accounting profession in shaping the climate change agenda.

Within the hot topic section, you’ll also find points of view from several of our industry sectors on the issues and the impacts facing their clients. We have also included over 30 articles, webcasts and podcasts that focus on issues around clean technology, renewable energies and sustainability.

Click here to download the latest Industry 360º.

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