Treasury's drivers of change

Back in February when the mornings here in London were cold and dank and the night skies descended upon us at 4:30pm, I shared with you a few thoughts about the importance of staying aware of treasury trends and how the treasurer’s role has evolved over the last 30 years.

Now, as we delight in the seasons change and step into spring here in the UK, allow me to explore the drivers of change in treasury. There have been many, and you will no doubt recognise how several of them feed off each other. Indeed, I may have even missed some obvious or more subtle ones, so please feel free to add comments and suggestions below.

Here are my 13 drivers:

1. Financial market volatility and crisis
2. Globalisation and the gradual removal of trade/capital barriers
3. Intermediation and disintermediation of banking services
4. Technology & innovation; paper to screen, to digital to automation
5. Development of financial market risk management products
6. The internet
7. Telecommunications, email and mobile telephony
8. Management incentives….and impact on capital allocation decisions
9. Financial scandal and society’s response to it
10. Regulation- tight or loose- as a matter of public policy
11. Evolution of the CFO role and the wider finance function
12. Treasury qualifications, standards and ethics- the creation of a body of professional work
13. And finally perhaps even the development of accounting has had an impact on IFRS, moving from a principles-based expert judgement approach to a more unified rules-based approach.

When I started as a treasurer over 30 years ago, I certainly couldn’t have anticipated such a wide range of treasury career influences. It’s worth noting as well that many of these have had an even greater impact across society at large. However, I think we can all recognise that they have had a fundamental impact upon the role of the treasurer and how their businesses perceive the value that they add.

So what does the future hold? Surely we should expect a similar pattern, specific changes which we can at least anticipate, and others which impact society as a whole and perhaps in turn will shape the treasurer’s role. If I had a crystal ball, I’d love to share my findings with you. Alas, all I can offer you is my experience of the past, which can often be a half decent indicator of what’s to come, so look out for my next blog where I’ll be considering what might be on the horizon for treasury in the future.