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Cash & Liquidity Management
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Treasury Management in France

As in the rest of Europe – and, indeed, the world – the role of the corporate treasurer in France is changing, says Emmanuel de Resseguier, Head of Global Transaction Banking France at Deutsche Bank

Within French corporates, how has the role of the treasurer changed over the past 12 to 18 months?

As is the case in all European jurisdictions, the role of the corporate treasurer in France has grown in importance in recent years. While this was a trend that was developing before the onset of the recent financial crisis – thanks to changing ideas regarding best practice in cash management and the increasing integration of this area with financial supply chain management – recent events have brought efficient liquidity management to the top of the agenda for many corporates.

The elevation of liquidity management to a boardroom-level issue in many organisations has resulted in a greater focus on the role of treasury and has made it imperative that the treasurer has comprehensive access to real-time information regarding all of a corporate’s transactions and cash positions. Access to this information ensures that internal sources of funding can be optimised and facilitates the unlocking of cash trapped in inefficient processes.

And how has the behaviour of treasurers changed since the crisis?

While some – especially larger – corporates already had cash pooling or similar centralised liquidity management structures in place, many others are now rushing to implement these models. And for those that may not have the geographic scope to justify such a structure, increasing visibility through using the latest electronic banking platforms can still yield significant benefits.

Indeed, a related area that has garnered a lot of attention in recent years has been the financial supply chain. There are two principal drivers behind this. First, many corporates have become increasingly aware of the importance of the ongoing financial health of their suppliers. Indeed, in some specialised industries the failure of a key supplier could be critical to the survival of corporates further up the production chain. Second, after many years of focusing on efficiencies in the physical supply chain, there has been a growing recognition of the benefits that are available through more actively managing relationships with suppliers. On the one hand this involves negotiation over payment terms and ensuring that key suppliers have enough breathing space in terms of working capital, but it also often involves the adoption of electronic platforms that can manage invoices and payments, as well as initiating financing opportunities.