ACTSA Anniversary Edition

“It gives me great pleasure to introduce the commemorative publication that marks a significant milestone in our Association’s history.

So what do the next 20 years hold? The profile of treasury and individual treasury professionals is dependent on demonstrating value and the benefits they bring to the organisation. The treasury function is increasingly becoming involved with many other areas of the business, adding value for example to the operating units and driving improvements which will ultimately have a direct effect on the company’s capital structure. Treasury is in effect becoming a business partner to its own organisation, assisting companies with the increasing complexity of both the financial and regulatory systems of the world in which they operate. ACTSA has come of age - and as this publication amply demonstrates, has provided South African corporates with help and advice in many areas. I have no doubt that it will continue to fulfil this valuable role in the decades to come, as it has done so successfully for the last 20 years.“

Charles Buchanan, Chairman, ACTSA

Introduction

ACTSA celebrates a milestone in its history - its 20th anniversary. The Association of Corporate Treasurers of Southern Africa was established twenty years ago during a time of increasing turmoil and destabilisation of the South African economy. A drastic correction in the JSE the previous year (1987) had lopped off a significant amount of share market value, while the growing level of isolation from the world through boycotts and trade restrictions was being felt throughout the country at many levels.

South African banks and financial institutions and the corporates they served were evolving into highly innovative and sophisticated global operators in finance under the pressure of dealing with a variety of risks. Treasury operations were a major part for their successful functioning, so the development of a recognised forum for

professional corporate treasury education and networking was a welcome move.

Against a background of political metamorphosis and several major financial market downswings, another significant factor changed life fundamentally - the emergence of computers. ACTSA was able to benefit from this new electronic age, gradually building a viable database of members and strengthening ties between the centres in Cape Town, Durban and Johannesburg, while becoming part of an international network.

ACTSA was founded as a non-profit, educational, professional organisation where skills transfer and information channeling were two of the main aims together with the promotion of treasury operations. [[[PAGE]]]

Overview

On 19 May 1988 a group of dedicated specialists in the treasury field got together to form a steering committee. This meeting of interested individuals was convened to explore possibilities locally - and an interim group forming the core of what eventually became ACTSA organised themselves into a committee - comprising Bill Tait (Barlow Rand), Francois Botha (Escom), Marius Ferreira (Gencor), Graham Holford (Anglo American), Bruce Sinclair (SAB), Russell Harte and Tim Store (Deloitte)

Fortunately they were able to liaise with the Association of Corporate Treasurers (ACT), the highly successful society for British treasury professionals dating from 1979 and managed to establish a strong bond that has continued to the present day. As a frequent visitor to SA, Tony Lighterness (Rio Tinto Zinc) a founder and office bearer of ACT (UK) became the liaison between the two groups and a tremendously valuable source of advice and support over many years for local treasury developments.

Marius Ferreira relates how he persuaded his boss Derek Keys (then CEO of Gencor and eventually Minister of Finance) to support ACTSA, so that he became the first president, together with Evert Groeneweg (Barlow Rand) as vice-president while Bill Tait was confirmed as chairman, the position he had held in the interim committee. Finally ACTSA could be officially registered as a going concern in 1988.

Following the blueprints and structure of the UK where treasury had long been a recognised profession in its own right, Tony Lighterness advised the local steering committee on ways of achieving the benefits of a formal association which included recognition, status, significant influence and networking in business, commerce and government. These factors and intentions thus formed the basis of the SA Association at its founding in 1988.

Official recognition of ACTSA’s credibility was achieved in 1989 when the Registrar of Banks, C.J. de Swart invited input on the revision of the Banks Act (1965) relating to definitions of treasury related items in banking operations in the forthcoming new legislation.

Eventually, when this fledgling association was well established, Derek and Bill both resigned their positions, becoming the first life members of ACTSA. Evert took over as president, while Marius was appointed chairman to begin an enthusiastic drive to consolidate and expand the activities of the young organisation. Meanwhile organisations were approached to increase the level of membership and by August 1991, this had reached 228. During the 1990s ACTSA was admitted to membership of International Group of Treasury Associations, and could then benefit further from widespread international networking.

At a strategic planning workshop in October 1991, a concerted effort was made to move ACTSA forward in its development by identifying objectives, necessary action, responsibilities, and the overall vision for the organisation. This was finally expressed as:

“To become an internationally recognised professional association which promotes the treasury function by enhancing relevant individual skills and by contributing to the orderly development of an effective financial market system”.

In retrospect Marius Ferreira recalls that the main reason for ACT (UK) being so successful was the focus on education. Membership was awarded only after an individual passed written exams; an approach that worked in the sizeable UK market but was not feasible locally.

Fortunately ACT (UK) was prepared to provide material for local use, so a means of converting this material for application within SA had to be found. UNISA became involved through the work of two entrepreneurial professors, Mike Kelly and Gawie du Toit. They went ahead with the project in 1992 providing an advanced programme in Treasury Management - unfortunately with limited success owing to the highly sophisticated level of the contents which were difficult to apply locally, so inevitably attempts at formal treasury education petered out in SA. This aspect remains a key part of the ACTSA vision and efforts continue to establish accredited professional courses for individuals locally.

The newsletter was first published in 1992, as a channel to reach subscribers and market the ACTSA vision. In the mid 90s work by the committee slowed down somewhat as there were many ideas but not the time to execute and subsequently the first CEO Jillian Davis was appointed and synergistically the regularity of the events/presentations/functions were revived. The highlight of her time with ACTSA was getting the journal up and running with an editorial board. Coverage improved considerably in 1997 when Marius negotiated with ACT (UK) to source their published articles and relevant material for re-printing in the South African edition. [[[PAGE]]]

Lily Mitchell was subsequently appointed in 1998 to replace Jillian Davis who relocated to Australia.The Southern African Treasurer was published in a glossy format that reached new heights of recognition under the aegis of Lily (ACTSA CEO 1998-2006) The Technical Committee (chaired by Allan Immelman) developed the principles of the Charter of Best Practice in Treasury Management. Lily initiated the adoption of the principles as recommended practice by the International Group of Treasury Associations (IGTA). In 2001 ACTSA held the secretarial position of the IGTA.

In 1999 ACTSA’s website had been developed and with this online presence, communication and marketing took unprecedented leaps ahead.

By 2002, with declining individual membership it became necessary to assess the relevance of the Association - was it an organisation trying to train workers, or a group of lobbyists or an accreditation agency? Regional activities declined. ACTSA was viewed to be primarily a Johannesburg club ignoring the interests of the wider national membership. A crucial indaba involving many stakeholders was held and produced a ‘Declaration of Intent’ of placing ACTSA at the forefront of treasury operations. This emphasised the need for professionalism and relevance of the association at the cutting edge of developments in the field, while reiterating the vision of the founders.

These efforts culminated in various new approaches by the Board - one of these being the change in membership structure - corporate membership became a recognised segment of the market and was promoted leading to the current status of 62 companies reflecting over 400 members and over 120 individual members. A positive side-effect has been a strengthening of the financial underpinning of ACTSA which has allowed various other activities to flourish. In 2004 ACTSA was offered the use of the Northwards office in Parktown by the BHP Billiton Trust which facilitated a professional presence in the market.

Another development was the creation of a fulltime post of general manager leading to the appointment of Artemis Galatis in March, 2007. Over the past year, many improvements have flowed from this re-structuring including: increased membership, numerous presentations in all three regional offices, conferences and workshops along with a greater range of interesting activities for members. An informative e-newsletter is sent off regularly and supports the expanded website where information and archived material is accessible to members while providing a forum for discussion.

Presentations are regularly held in each of the regions covering a diverse range of topical subjects examples of which have been ; the state of the SA economy, overseas economies and happenings abroad such as China; keeping abreast of changes in legislation ; the role of Ethics in the workplace .

Workshops have been and will continue to be presented on basic elements of Treasury. Successful conferences have been co-hosted with Moody’s Investor Services, EuroFinance and the Debt Issuers Association, all of which have served to provide valuable and current input to all who participated.

Networking opportunities are provided with a special focus on annual Golf days which take place in both Cape Town and Johannesburg.

We at ACTSA are strongly committed to realising the ACTSA vision, unchanged over 20 years, to recognise the profession and role of treasury in business and to promote this through accredited education, training and skills development in a non-racial environment.

The success of any organisation is the commitment of the stakeholders. ACTSA would like to acknowledge the contribution of our members (both corporate and individuals) and our sponsors. We need also to express our appreciation to international organisations such as ACT (UK), International Group of Treasury Associations (IGTA) and Treasury Management International (TMI) with whom we have had fruitful affiliations to date and with whom we trust we shall continue to interact meaningfully.

Currently ACTSA is well-established to spearhead treasury professionalism and education throughout Africa as well as being part of the international network of treasurers.