Treasury consultant Fiona Crisp, chair of the ACT’s recent Cash Management Conference, reflects on the important role that corporate treasurers play in today’s business environment.
The ACT’s Cash Management Conference is one of the highlights of the ACT’s calendar, and it was great to again see so many treasury professionals gathered to learn about the latest developments affecting our work – and how they impact the overall performance and resilience of our organisations. Above all, we learnt how important it is that treasury is involved in the wider aspects of the organisation – we are going through a period of rapid change, and treasury is an intrinsic part of that change.
Planning and flexibility during these periods of change play a crucial role, and this was clearly demonstrated by the call from the Bank of England for treasurers to have an input into the design and possible implementation of a central bank digital currency. As the Bank prepares for the ‘likely’ introduction of a ‘digital pound’ in response to changing payment patterns, it needs to be fit for purpose. Consumers will want to be able to use all available payment options, so businesses have the opportunity to not only prepare for, but also influence the shape of that change.
The Bank wants to understand the opportunities of a digital pound for business, and who is better placed than treasurers to outline these opportunities?
Elsewhere during the conference, we heard about the risks of cyber attacks and the importance of zero-day threats. These are risks that software providers need to fix immediately to avoid potential attacks – they quite literally have zero days to fix them, as hackers will be aware of the vulnerabilities and be able to exploit them. Allied to this, we learnt about the work of ‘purple’ teams, which combine red (attacking) teams with blue (defensive) teams to improve cyber security in an organisation.
Looking at the more positive aspects of technology, there is no doubt that cash forecasting, FX risk management, liquidity management and reducing counterparty risks will all be well served by the advances we are seeing in the digital world – this was a recurring theme throughout the day. One frequent question was about whether now is the time to update or replace cash management systems or, given the speed of developments, should treasurers hold off. Most agreed that there is no time to waste.
The timing of the conference was very relevant – treasurers are at the sharp end of risk management involving potential, and actual, bank collapses. We were reminded that security and liquidity are key, and that senior management and the board are again asking questions of the treasury function and their policies.
So, if you haven’t done so recently, now is the time to test and update your treasury policies and ensure they are flexible and relevant in this changing business environment.
Fiona Crisp is a treasury consultant, past President of the ACT and chaired the ACT Cash Management Conference