by Valérie Sainsaulieu, Head of Treasury Control, Lafarge
In 2009, TMI’s SWIFT Connectivity Guide featured an article by Valérie Sainsaulieu about Lafarge’s SWIFT connectivity project. Since then, treasury has rolled out SWIFT connectivity across 10 countries, using Kyriba and Datalog’s CashPooler systems. With 80 signatories across the banks to which the company is connected through SWIFT, Lafarge wanted to find an automated and secure means of digitally signing payment instructions that could be used across all the company’s banks.
Corporate treasury at Lafarge
Corporate treasury at Lafarge acts as an in-house bank to the group and has centralised its key treasury functions (cash management, financing and financial risk management) as far as possible with 20 people located in Paris and Brussels. In addition, there is a treasury function in each of the main subsidiaries, and country treasurers have close links with corporate treasury. The treasury is a centre of expertise for the group, publishing policy, guidelines and financial best practices. It assists and supports subsidiaries in all treasury related issues where appropriate. All major external financing is conducted by Lafarge SA, which then finances group companies on an intercompany basis. Borrowings in local currency and/or with local lenders are performed directly at country level supported by corporate treasury.
We conduct cash management centrally whenever feasible, with local dedicated cash pools in France, the UK, the US and elsewhere. We have a pan-European cash pool for most European countries, and a multi-currency cash pool for all our main currencies. In total, we work centrally with around 10 international cash management banks, with some 200 accounts. To date, we have not centralised cash management on a daily basis in Asia, Africa, Middle East or South America. In these regions, corporate treasury manages cash transfers and short- to medium-term financing via intercompany loans. Corporate treasury is also the primary counterparty for the hedging requiremenst of the business units. We combine exposures across the business and conduct external hedging transactions, and then perform back-to-back intercompany hedges.
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