Strategic Treasury

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Defining a Treasury Roadmap: ‘Journeys to Treasury’ One of the most distinctive announcements at SIBOS 2016 was of the publication of Journeys to Treasury, the first of a flagship thought leadership initiative by four major players: BNP Paribas, the EACT, PwC and SAP.

Defining a Treasury Roadmap: ‘Journeys to Treasury’

Defining a Treasury Roadmap: ‘Journeys to Treasury’

A BNP Paribas partnership feature

As we embark on this year’s conference season, we can expect an array of new announcements, research findings and white papers to be published. One of the most distinctive, however, is ‘Journeys to Treasury’, a flagship thought leadership initiative by four major players: BNP Paribas; EACT (European Association of Corporate Treasurers); PwC and SAP. Following this initial publication, the aim is to establish and develop an ongoing conversation between some of the key participants in the treasury community to reflect treasurers’ evolving priorities, and the solutions and services that are emerging to address them. As Jean-François Denis, Deputy Head of Cash Management, BNP Paribas highlights,

“Our main objective in devising this study was to reflect the different facets and viewpoints on some of the topics on which our corporate treasurers are focused, rather than the single dimension that characterises most industry reports.”

The themes of ‘Journeys to Treasury’

One of the first priorities was to identify the themes on which the report would focus, which was challenging in itself given the breadth of issues in which treasurers are engaged. Damien McMahon, Partner, PwC explains,

“This project first started life at an EACT meeting where treasurers discussed and debated the issues that were most important to them, and whittled the long list into a shorter list that became the key themes of the ’Journeys to Treasury’ conversation: innovation, and changing expectations in this area; the ‘anytime, anywhere treasury’, and cybercrime and fraud.”

 While these themes are familiar to treasurers, what quickly became clear during initial conversations was the lack of clarity on what was really happening in these areas, and the implications for their business. As Jean-Marc Servat, Chairman, EACT comments,

 “In a fast-changing environment, there is a great deal of ‘hype’ around industry buzzwords, but treasurers need a way through this to understand what really matters.”

Continued innovation

Emerging fintech players have the potential to complement and in some cases disrupt existing solutions and services from banks and established technology vendors; however, their success in achieving this will depend on adoption. Although there is appetite amongst corporate treasurers for solutions that help to overcome inefficiencies and allow them to contribute value in new ways, there are a number of blocking factors. In particular, existing banks and technology vendors have built relationships of trust over many years, which is particularly important bearing in mind the value and sensitivity of transactions and information managed in treasury, which newer players lack. There are also concerns over security and risk, lack of regulation, and the ability to integrate new solutions within the existing technology infrastructure. Treasurers are also wary of being ‘early adopters’ of new, unproven technology, and to working with vendors that may not be viable in the longer term. Damian McMahon, PwC outlines,

“Generally, we are still seeing fintech companies having the biggest impact in the retail space, where the population is higher and solutions are easier to adopt. Over time, the success of these solutions then create expectations and confidence amongst corporate treasurers, particularly those that operate in retail industries, so they then expand into the corporate space.” 

Some of the perceived obstacles can be overcome by working with fintech companies in partnership with existing banking and technology partners and indeed, partnering or integrating these solutions within their value proposition. As Christian Mnich, Senior Director, Treasury and Risk Management, SAP discusses,

 “Like banks, ERP vendors are partnering with, and investing in fintechs, whilst also providing the technology platforms on which they are growing their business. These partnerships and investments allow major technology vendors to build new capabilities into their solutions to meet evolving customer demand very quickly and precisely.”

New technologies such as blockchain, and developments of existing capabilities such as big data are already having an impact in certain industries, but they will not become priorities in corporate treasury until a detailed value proposition and proven solutions have been developed. This will change in the coming years, but as Jean-Marc Servat, EACT emphasises,

“While we are seeing new terminology and technologies emerge, the concepts themselves are not new, and are part of the ongoing journey of technology innovation. What is perhaps changing, however, is the potential for disruption, challenging banks and technology vendors to review their business models and the way that they engage with customers.”

 

 

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