Core treasury knowledge and training are key to success for Stephen Poon, CTP, who leads the head office treasury function of HUTCHMED, a biopharmaceutical company based in China.
“The CTP training provided me with a very solid foundation,” said Stephen, who is based in Hong Kong and advises business unit finance leaders on various treasury topics, such as electronic payments, as well as other evolutionary practices that can help improve their operational efficiency and lower compliance risk.
Management, oversight and support
Stephen is the Senior Director of Corporate Control, Group Treasury and Taxation, and a key aspect of his job is liquidity management. Due to the nature of HUTCHMED’s business — drug discovery and development in the treatment of cancer and immunological diseases — they incur immense R&D expenditures, making liquidity management a top priority of treasury.
It is important for Stephen to be thoughtful and disciplined in determining how to prioritize cash resources to the various R&D projects. This means collaborating very closely with business unit finance leaders, in particular the company’s two focus markets, China and the U.S., which entails overseeing their forecast cash flow positions, assisting in the determination of their funding needs, and reviewing the management of their working capital and investment of surplus cash.
Another primary aspect of Stephen’s job is related to the supply of internal funding in support of the business units’ operations. The U.S. and China each have distinct and complex legal systems and requirements, so he and his team have to be meticulous in how they plan and arrange the funding, which comes in many different forms including capital contributions, shareholder loan funding and external credit facilities.
Recently, Stephen said his responsibilities have expanded to include supporting the company’s group taxation function, which merges the treasury and taxation functions into a single team. “This helps achieve a lot of operational efficiency in terms of the relevant planning, compliance and review work,” he said.
The increased cost of obtaining capital
With rising interest rates in the U.S. and worldwide volatility of capital markets, as well as the continuing geopolitical tensions, it is currently expected that the increased cost of obtaining capital — something the market as a whole encountered over the past year — will continue for the foreseeable future. This is something Stephen’s company has experienced as well. When asked for his advice and plan for dealing with the issue, he laid out a simple strategy.
“Every company will need to get back to the fundamentals,” he said. By this Stephen means that companies need to plan ahead with precision and thoughtfulness when it comes to funding. They need to revisit the different components of their cashflow forecast, such as working capital management and capital expenditures, “to preserve their liquid assets and extend the cash runway where applicable.”
The future is digitized
In the coming years, Stephen would like to add develop other skills, primarily centered around technology. “As technology continues to mature, keeping up with the automation and growing digitization of treasury applications is critical,” he said. “We all need to keep up to date with emerging technological solutions and, whenever possible, incorporate them into our daily routines.”
Stephen said he will be looking for opportunities to consider the improvement of treasury workflow, including possible automation of different treasury management applications, such as cash flow forecasting, budgetary control, working capital management and surplus cash application, where feasible. “More reliance on technology is the direction of the treasury function moving forward,” he said.
A world leader in treasury training
Stephen said he decided to earn his CTP due to the certification’s global reputation for excellence. “Not only is the credential valuable in the U.S., it’s highly recognizable in the Asia Pacific region too,” he said. “Therefore, it made a lot of sense for me to earn the credential in order to aid in my progression in the treasury profession.”
Since earning his CTP, Stephen feels more confident in approaching his day-to-day responsibilities, as well as providing advice on the latest treasury trends. This is due in part to the ongoing access AFP provides to CTP-certified professionals. “I have instant access to AFP’s enormous database of treasury-related resources and materials, which helps me stay up to date on the latest industry and technological advancements,” he said.
Stephen “definitely” recommends the CTP to anyone with career aspirations in the field of treasury. “The CTP will absolutely bring value to your career progression,” he said.
Ready to progress your career in treasury? Get started on your journey to earning the CTP today.