NEW ORLEANS -- Treasurers have expressed difficulty finding young talent that they can mold into the top treasury professionals of tomorrow. Many say the crux of the problem is that college business programs do very little to prepare young professionals for careers in treasury. Would a treasury curriculum solve the problem? This was the question that AFP’s Treasury Advisory Group (TAG) attempted to tackle in their latest meeting last week.
“No one ever says, ‘When I grow up, I want to be a treasurer,’” noted one TAG member. Nevertheless, with more than 16,000 treasury professionals in AFP alone, it is clearly a desirable field to be in. So why haven’t universities realized this?
A tried and true initiative
However, there are a number of colleges that have adopted treasury management programs, and they have seen success. Jim Washam, assistant professor at Arkansas State, explained to the TAG that his university has partnered with AFP since the mid-1990s to offer course in treasury management. “The idea behind that is that we would offer treasury management class at the university, and students who completed it with an ‘A’ or a ‘B’ were eligible to sit for their CTP exam before they got their experience,” he said.
Students who passed the exam are deemed CTP Associates. They then have five years to complete two full years of actual treasury work. Once that is complete, they can drop the “associate” part of the title. The university has had substantial success with this program; the vice presidents of treasury for both Wal-Mart and eBay are alums.
“There’s some specialized knowledge there that you don’t get at most universities,” Washam said. “Most universities have a broad finance program or have their students spend more time with investments. Our kids come out and they know, basically, how a commercial paper program works, what a revolving credit facility looks like, those types of things.”
Arkansas State is now expanding its efforts, and has launched the Center for Treasury Management program. That name may change, however, as there are plans to include financial planning and analysis (FP&A) courses. Washam noted that the university recently hired Dr. Matthew Hill, CTP, FP&A to help develop the program and teach courses. In fact, both Washam and Hill are currently writing the new edition of “The Essentials of Treasury Management”, the CTP body of knowledge.
The ideal student
Washam asked for TAG’s input in helping to determine what a curriculum that prepares young talent for a career in treasury should look like. He is currently putting together an advisory board of treasury professionals to gather more input for the program.
Washam noted that the ideal student in his program sees the “bigger picture” of finance, but also understands how treasury fits into it. “They’ve got that strategic view of treasury,” he said. He explained that Arkansas’ treasury classes have traditionally been very focused on traditional treasury functions, but now the university is looking to make the classes more strategic by including other areas like FP&A.
“The problem with hiring young college grads is they don’t know anything about treasury, because typical finance programs at universities don’t develop people for this profession at all,” said one TAG member.
One treasurer said that he has hired people fresh out of college, and he doesn’t mind having to educate them. “I don’t really care,” he said. “I hire more on talent than I do on experience, so I try to find bright people who are motivated and interested. Then I teach them. Even when I get experienced people, we still need to do a lot of re-teaching. We need to show them how everything works for us and our processes.”
The treasurer added that his group is only so big, so finding people with a lot of talent and broad range of interests ultimately can be better in the long run. “I can only get so many people moved up in treasury because there are only so many slots,” he said. “But if I’m hiring bright people who have interest in other things, they can move into the FP&A group or somewhere else, and I’m fine with that.”
Another treasurer noted that hiring someone young solely for a specialized role can lead them to want to move into different areas. “Maybe all they do is issue commercial paper all day,” he said. “They get bored with it. So they want to move on.”
Added the first treasurer: “I wouldn’t hire someone who has only specialized in treasury in college because at that age, you don’t know what you want.”
Conversely, a third treasurer said he would prefer to hire individuals who are actively engaged in treasury in college. “To me as an employer, if someone was a finance major and had an emphasis on treasury management or operations, that means I don’t have to teach them what a ZBA is or what a cash concentration is,” he said. “That person will be hired.”
The second treasurer noted that the banking sector is a huge job market for treasury professionals who have earned the CTP. Most banks require their treasury management sales officers to have earned the certification, he explained. Therefore, a treasury major like Arkansas offers, or some sort of certificate earned in college, might make recent graduates more attractive to banks.
A bank executive in the group agreed. “I think a certificate might be the right way to go here, and maybe you need to have different courses for students who want to go the corporate treasury route versus the transactional banking route,” she said.
Overall, the group agreed that students majoring in finance would benefit from taking treasury courses. “Even if they go the finance route, at least they’ll have that appreciation of treasury,” said one TAG member. “It prepares them better; it keeps the options open.”Learn more about Arkansas State University here.