Over the last six to twelve months, there has been extensive coverage in the media of the importance of investor confidence, particularly when looking for growth, whether that be at an organisational level, or with reference to the wider economy (national or global).
At the same time, the rapidly evolving geopolitical environment has added a level of uncertainty seldom seen – and (it’s a cliché for a reason), the one thing that markets (or pretty much anyone) hate is uncertainty.
It’s the fastest way to stop investment decisions in their tracks and encourage organisations to look internally to generate returns through activities such as tighter working capital management or deploying surplus cash through share buybacks (which traditional finance theory suggests take pace when the organisation is unwilling to deploy the cash for investment purposes).
It is important that treasurers have an appreciation of the external market conditions that may be affecting investment decisions – whether that be the decision to expand manufacturing capacity, enter new markets or identify potential investors into your business.
Since the turn of the century, there has been a relentless trend in greater and more complex regulation – much of it is well-intentioned and developed as a result of specific events (whether that’s the failure of a corporation such as Enron, the global financial crisis) or developments in markets and technology.
However, an unintended consequence of many layers of regulation being introduced is that it makes it that much more challenging for a business to navigate its way through the rules, and ironically results in those organisations who are more risk averse (concerned about tripping over the rules) less likely to invest.
The one request that we at the ACT regularly hear from members is a desire for regulators in the widest sense of the word, to stop moving the chairs around and provide certainty. To some extent, treasurers don’t mind ‘what’ is decided on, they are problem solvers. Once they know ‘what’ the situation is, they can address it – but there needs to be a degree of stability or certainty to enable this to happen.
A major element of the ACT Annual Conference is the focus on the strategic, global and geopolitical elements that treasurers may not generally get time to consider and, importantly, discuss with their peer group. Join 1,000+ treasury and finance professionals at ICC Wales on 20-21 May 2025 to discover how to plan and react to the current complicated geopolitical environment, understand the balance between risk, regulation and growth, and make confident investment decisions.
