Treasury Today Country Profiles in association with Citi

Treasury then and now

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The below article is derived from our inaugural Treasury Talks podcast. In the first episode of the Treasury Talks podcast, created in partnership with the Singapore Association of Corporate Treasurers, we hear from some of the country’s leading treasury professionals. They talk about the treasurer’s changing role and highlight the skills you need to be a successful treasurer today.

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James Hayward, Associate Editor, Treasury Today Asia: What skills are required by the modern treasury professional?

Sonia Clifton-Bligh, Director – Regional Treasury Services Centre Asia Pacific at Johnson & Johnson: Technical proficiency is crucial. This really underpins any treasury professional’s ability to add value to the organisation. On top of this, it is also important to have knowledge around risk management strategies, financial techniques and products and financial analysis.

Seng Ti Goh, General Manager Treasury & Accounting at Isuzu Motors Asia: We need to be analytical and good with numbers. Increasingly we also need to be creative and willing to experiment with new products. This relates to the need to be adaptable, especially as markets evolve.

Jinny Goh, Treasurer at SMRT Corporation: The modern treasury professional needs to be a good communicator. We need to have a continuous dialogue with the business units to understand their pain points and ensure we support them effectively. This is crucial to ensure that the corporate treasury department stays relevant within the wider organisation.

James Hayward: How different are these requirements from those a decade ago and if they are different what has brought about these changes?

Sonia Clifton-Bligh: Ten years ago the role of the treasurer was more operational in nature, responding to the outcomes of business transactions. Most of the work was conducted in the background, ensuring that the bills were paid, collections were banked and that the operations were funded with any excess cash investment securely.

Today the treasury has taken on a more strategic role as a partner to the business. Part of this is a consequence of the global financial crisis, which really required treasury professionals to apply their skills and knowledge to proactively assess and address risks across the breadth of the business.

Jinny Goh: The essential skills have not changed too much, but market events in recent years have made the treasury function more important within the organisation. This has driven a change in how treasury departments are structured, giving rise to consolidation, centralisation and the increased automation of treasury activities.

Seng Ti Goh: Before the financial crisis the treasury was not a key department in many organisations. This has changed, today we have the ear of the C-Suite who have recognised the value we can add. As a result, our views are more valued than they were in the past.

James Hayward: Given that we are a decade on from the crisis now, will this evolution continue? What will treasury look like in the next five to ten years?

Sonia Clifton-Bligh: Yes, this evolution is continuing and treasury is becoming a value creator. This is where treasury teams deliver strategies that extend beyond simply preserving the balance sheet and instead craft strategies to optimise it.

Jinny Goh: I believe the evolution will continue, but I do not foresee dramatic changes. Treasurers still need to manage the cash, the liquidity, the funding and mitigate financial risk. The question we need to ask is: ‘how do we do it better?’

The use of technology, big data and analytics will be important in answering this question. Indeed, these technologies are already going a long way in helping us be better in our roles. At the same time though, this opens a whole new work of risk that we must manage.

James Hayward: What will be the big challenges that treasurers will have to tackle in the years ahead?

Seng Ti Goh: I think technology, and understanding what it can do for you, is a big challenge that treasurers must tackle. There is a lot of disruption in the market at present and everybody wants to be a part of the fintech wave. As a treasurer, I think that the key is to understand this technology and how we can use it to enhance what we are doing and better support the organisation.

Political winds are also changing and there seems to be an increasing trend towards protectionism. This may manifest itself in more stringent requirements before we can bring funds out or bring funds into certain markets. We have already seen this in countries such as Malaysia when the central bank imposed currency controls overnight. In times like these, treasurers must adapt quickly.

Sonia Clifton-Bligh: We know that regulation is here to stay and today are being introduced at an exponential rate. Addressing the impact that these have on the business requires agility and innovative thinking. This is especially important for businesses that have centralised treasuries and standardised operating procedures.

The ability to be agile and respond accordingly to regulatory change will come from knowledge of the business, its operations and its processes. With this, treasurers can be well positioned to modify processes and respond to any regulatory changes as they occur.

Another challenge will come from data. We have access to great volumes of data and filtering what is relevant and converting that data into meaningful information is a challenge. If solved though it can offer the business a competitive advantage.

James Hayward: What can treasurers do to build their skill sets and become true strategic partners to the business?

Jinny Goh: There is no one answer to this, we all have different aspirations and are at different stages of our careers. But something we can all do is build our skill sets to develop new ways to add value to the organisation.

For instance, if you feel there is a technical gap and you want to improve your technical toolbox, continuing education to formal certifications from courses might be necessary. On the other hand, if you want to add value to your business, you may need to spend more time understanding your operations and finances. On the job training can help here.

Joining the treasury community like the ACTS is also useful. It allows you to meet like-minded treasury professionals, stay abreast of the latest trends and learn from each other.

Sonia Clifton-Bligh: Driving innovation is a skill set and part of the role of the treasurer today. We must, therefore, develop and foster innovative behaviour within our departments.

One of the ways we can develop innovative behaviour is by changing the way we think about things. Treasury, as an industry, can sometimes be reductive and dismiss new ideas when they arise. This is something that we really need to change. By doing so we can become expansive thinkers, who keep an open mind, allowing an idea to mature before we decide to dismiss it. Staying curious is a big part of this and being able to see the possibilities and envision a better future.

To hear more about what three of Singapore’s leading treasury professionals have to say on how the profession is evolving listen to the podcast.

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