The “enabling business growth” view of treasury comes in a report from Citi Bank looking at the future for corporate treasurers and how they might achieve “real-time” operations and “best in class” status by 2030.
The report says: “Given the current state, most treasuries will need to overhaul operations to advance and arrive at the 2030 vision. In turn, it will mean treasurers garnering a bigger share of the budget pie and getting investment for modernisation.”
Shahmir Khaliq, head of services at Citi, warns the changes required by corporate treasurers will need “close partnership” between companies and banks if it is to be fully realised.
“The prize is treasury taking on – and delivering results against – an expanded role within the organisation that better equips business to meet the goals and objectives set by the CEO and stakeholders,” he says.
Citi’s view of the future comes at a time when economic growth is uncertain, geopolitics potentially destabilising and artificial intelligence could be a major disruptive force in business. Treasurers, according to Citi, will need to go beyond risk management. They will need advanced AI and need to switch to real-time operations using a range of advanced technologies.
“Companies, irrespective of business model, will need to move towards real-time treasury that accelerates the velocity of cash,” the report says. This is being driven by advances in banking and the application of blockchain technology that is able to automate the flow of money in a way that allows multiple parties to share and update data and enable concurrent transactions.
The report adds this will involve new treasury systems with improved automation and accuracy and will “require a fundamental re-engineering of treasury processes and how treasuries consume and harness data”.
The ivory tower days are gone. Those with tech chops and ability to change will be in demand
Meanwhile, Citi finds that treasurers are circumspect about their progress. While more than half, 52%, believe corporate treasury will be “materially more advanced’ in five years, they also believe there is a “lot of uncertainty as to what shape this will take and how progress will happen”. A hefty 41% say they expect “incremental” change rather “transformative advancements”.
The report stress that a shift to real-time treasury management will require the co-ordination of banks, corporates and central banks to create a “seamlessly integrated network”. It adds: “This new network would overcome several structural inefficiencies in how payments happen today, such as time zones, regulatory and technical requirements and operating hours.”
Despite the prospect of advanced technology and automation, Citi says people will still be required, though treasury teams may be more “globally dispersed”. Treasurers will need to review their technology requirements and then the skills required. This could be a watershed moment for treasury staff.
According to the report: “The ivory tower days are gone. Those with tech chops and ability to change will be in demand. The legacy core treasury skillset can be learned by the next generation of professionals on the job.”
Read the full report: Treasury 2030: Modernize or Risk Irrelevance
Gavin Hinks is a freelance business and finance journalist
