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Two Words to Describe Treasury Today? Chaotic and Fragile.

  • By Craig Martin
  • Published: 8/25/2016

This article originally appeared on LinkedIn Pulse.

One of the best parts of my job is that I frequently speak with treasury and finance executives. It’s an amazing business education, to be sure. Recently, I was talking with the treasurer of a Fortune 500 global distribution company about his treasury group and structure and where he might consider it along a continuum of maturity. He said on a scale of 1 to 5 they’d be a 3: established. Then he went on to say that his treasury is centralized at headquarters in the United States but he had visibility into his cash, borrowing needs and FX risk in the 17 countries in which they operate. I thought that sounded a bit more than just established! And then, as we were discussing what he did in his job as treasurer, a role he’s held for almost five years, he said that not only is he in charge of treasury and all that goes with it, but he also has responsibility for IR, ERM, real estate and risk insurance. I said I thought he was a lot more than treasurer!

All this has happened to his role since the financial crisis. It has grown in responsibility and importance in the company dramatically over that time. He went on to ask himself what resources he needed so that the treasury group could get to the next level and the next, which would be first playing a strategic role in the business and ultimately become a contributor to the business overall.

All of this discussion took place in the context of a whitepaper AFP is developing with Zanders, “Beyond Transformation, Treasury Transcending,” which will be published in early October. In discussing this concept further we talked about what is beyond the issues of today, and what will treasury look like five years from now? What will the treasurer’s role be? That led us to the current and future issues facing not only treasury but businesses as a whole. It is no longer sufficient for risk management to consider only FX, interest rate and commodity risks, or even today, cyber risks. It is becoming increasingly clear that one has to consider geopolitical risks and even pure political risks as they may affect the outcome of the financial markets and more broadly economies around the globe.

As I consider what is the overarching theme facing treasury and finance leaders today and into the future, that is what I think of. One word to describe today and tomorrow’s environment for treasurers might be chaotic. It’s such a negative word! If that’s too harsh, perhaps fragile will do. As my treasurer friend knows all too well, treasury increasingly deals with chaos and fragility every day.


The whitepaper, Beyond Transformation, Treasury Transcending forms the basis of a session at the AFP Executive Institute, exclusively at the AFP Annual Conference in Orlando. Learn more about the event.

Craig Martin is director, executive programs and treasury practice lead for AFP.

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