The intention under this pillar was to identify and run the most crucial projects regionally to extract maximum organisational efficiencies.

As the business had grown rapidly over the last three to four years with newer market operations launched, the Danone treasury team took the opportunity to conduct a deep dive of the last 12 months into all key processes and identify which would benefit from enhanced visibility via a centralised approach.

With a diverse set of processes and systems for each market, the existing process for FX risk mitigation was inconsistent. “We embarked on a comprehensive review of the policy with clear, regionally standardised processes and unified goals. The team then deployed relevant features of Kyriba to extract improved value from the FX exposures and obtain higher levels of transparency,” says Zurab Abutidze, Regional Treasury Director.

Next was bank access management and their aim was to improve security of the entire banking access via two online banking platforms (online banking platforms).

The result is a standardised process for the Bank Access Management across the key banks and geographies with standardised documentation.

Under the liquidity management stream the company’s aim was to explore surplus liquidity across all markets, open and restricted and either upstream proceeds to group for funding business growth/reducing interest expense at parent level or improve interest income for balances retained within Asia.

China is one of the most crucial markets for Danone globally. The team worked on a dual strategy of offshore cash lending and offshore cash pooling with a view to manage core excess cash as a one-time activity with lending and managing regular operational needs (surplus and deficiency) with a regular pooling solution.

The solution implemented in Oceania was not a traditional zero-balance (ZBA) structure, but rather a cross-border pooling structure from Australia and New Zealand directly to the accounts held in the Netherlands with BMG bank.

“The solution allowed us to upstream around €180m and reduce interest expense significantly. Implementation for HK and UAE is underway and will be complete by the end of 2021,” says Abutidze.

Other projects under this pillar include automation of deposit/MMF reporting in TMS, green deposits in India and a revamped banking strategy in the region.

The aim here was to revamp and enhance operating modules at multiple organisational levels to state-of-the-art solutions furthering business objectives and ensuring they remain inter-operable.

Danone embarked on a massive initiative under the digitisation pillar with a range of big and smaller projects aimed at leveraging the new-age digital tools leveraging functions like digital platforms, artificial intelligence (AI) and machine learning and improving shareholder returns via enhancement of working capital.

By its decision to select Kyriba, the company was looking for full end-to-end visibility, transparency, and improved security.

The team focused on a phase implementation across 17 markets in close coordination with multiple internal and external stakeholders to ensure timely completion.

SWIFT GPI has been enabled on the regional e-banking platforms and SWIFT KYC registry has been tested with a complete process with one of the core banks in Singapore in July 2021.

Launching virtual accounts with banking partners and digitising cash collections in Indonesia has also been implemented and rolled-out for 18,000 end customers and 300 distributors in Indonesia and the local business benefitted from a robust reconciliation tool.

This pillar’s goal was to bring all the teams together towards a common process, reduce fragmentation and operational risks.

The aim was to rationalise and standardise payment processes across the region maintaining service quality at a high level. Increased efficiency and compliance was part of the objective as well.

As a result, Danone centralised operational treasury tasks (payment execution, bank reconciliation, bank statement management, reporting) for Thailand, Cambodia, UAE, Australia, and New Zealand in Malaysia. Another five countries in the ASPAME region are under way.

Sustainable supply chains are also key to Danone, so the team extended its existing supply chain finance (SCF) programme in Indonesia to a wider spectrum of suppliers across multiple businesses. They replicated the structure to their regional procurement hub in Singapore, along with local programmes in Turkey and the UAE.