The corporate world may have become increasingly sophisticated, but the impact of outdated perceptions should not be underestimated.

For example, the view of treasury as a back office cost centre rather than a strategic enabler persists at many organisations – a perception fuelled by organisational structures and technology systems that isolate treasury from commercial functions, coupled with inadequate access to real-time business intelligence.

The solution, suggests Francois Masquelier, Senior Vice President & Head of Treasury and Enterprise Risk Management at RTL and Chair of the European Association of Corporate Treasurers, is to position treasury as a centre of excellence for liquidity, risk and funding strategy, aligning more closely with CFOs and business units.

“We need to change the rules, recruit other expertise and skills more effectively and differently and automate to analyse and propose decisions more rapidly,” he says. “The move towards a strategic role closer to the C-level requires a different approach from top to bottom.”

Transforming treasury from a purely transactional role into a strategic partner requires overcoming a number of key challenges, the most important of which is gaining visibility and trust at decision-making level. As every major strategic choice – merger, product expansion, market entry – impacts cash, treasury’s deep understanding of liquidity, risk and funding makes its perspective essential.

“We need to change the rules, recruit other expertise and skills more effectively and differently and automate to analyse and propose decisions more rapidly.”

Francois Masquelier, Senior Vice President & Head of Treasury and Enterprise Risk Management, RTL

Julianna Achmatow, Vice President, Global Treasurer at Calibre Scientific suggests that in many organisations, treasury is only brought in after decisions are made rather than being involved from the outset.

“Building trust and demonstrating the strategic value of treasury takes time,” she acknowledges. “From my experience, once treasury is seen as a team player and forward-thinking function, it becomes much easier to be included in discussions that shape corporate direction.”

The key to moving from a purely transactional function into a key contributor to the corporate strategy is the ability to demonstrate realised value. While this is simplistic on the macro level, it presents a number of challenges suggests Benjamin Seal, Director of Global Treasury and Risk Management at Inotiv.

“These include adopting technology that automates daily non-added-value tasks,” he says.

Seal reckons breaking down departmental barriers is one of the most difficult tasks treasury professionals must overcome in order to become a strategic partner and adds the ability to effectively communicate with internal and external stakeholders to the list of challenges.

The absence of a strategic mandate within the office of the CFO to link treasury activities to the company’s objectives and strategic KPIs and treasury departments mired in day-to-day operations and analysing the past are additional obstacles to creating a more dynamic structure.

Tobias Westermaier, Partner at Zanders refers to long-serving treasury teams working in the same way while organisational needs have changed as well as underinvestment in skills such as project management, change management and business leadership.

Old school treasury functions were purely transactional and often nay-sayers suggests Cugavadi Founder & Managing Director, Chris van Dijl. “The new treasurer needs to build strong relationships throughout the organisation and work with the business to assess areas in which they can add value,” he says.

“From my experience, once treasury is seen as a team player and forward-thinking function, it becomes much easier to be included in discussions that shape corporate direction.”

Julianna Achmatow, Vice President, Global Treasurer, Calibre Scientific

It is hard to argue with the view that evolution of strategic treasury depends on the next generation of treasury professionals having sufficient understanding of the factors that impact business strategy.

“While I believe the new generation of treasury professional have a general understanding of the factors that impact business strategy, every organisation has specific factors that they must be able to fully understand to contribute to the strategic goals,” says Seal.

Westermaier refers to treasury teams as being on a spectrum from sophisticated functions and professionals who are deeply integrated into the business and have a profound understanding of the strategy and factors driving it to those with a siloed focus on their specific tasks.

“Often this is a result of treasury set-ups running in an ‘operational’ mode only with limited strategic mandate and perspective on the business,” he says. “Underinvestment in training, job rotation and technology contributes to lack of business context understanding. CFOs and group treasurers who have a roadmap in place, measure success, link treasury to the organisation’s objectives and invest in people and technology typically run engaged and context-aware treasury teams.”

Masquelier believes treasury needs to evolve in terms of recruitment and give the younger generation the intrinsic and technical qualities to enable them to achieve the objectives set by management.

He says training focus should include business modelling and financial strategy, stakeholder communication, data literacy and digital tools and cross-border and regulatory awareness and points to the value of rotation programmes and strategic mentorship.

“Everything evolves in treasury, except the way we recruit and train,” adds Masquelier. “Our peers need to reassess their approach and rethink recruitment, the required and missing qualities (soft and hard skills) and train better and differently. This won’t be easy for treasurers who are hyper-conservative by nature.”

In terms of data analysis specifically, Seal reckons there will always be scope for further improvement and that treasury professionals must be able to adapt to AI in order to continue to contribute to strategic organisational goals.

Achmatow agrees that there is significant scope for further improvement in financial data analysis to empower treasurers in shaping key business decisions.

“Most organisations still struggle with fragmented systems, lagging data flows and limited integration across finance, operations and strategy,” she says. “Ultimately, better analysis enables treasury to move from being reactive to proactive – from asking ‘what happened?’ to confidently answering ‘what’s next?’.”

Westermaier identifies strategic enterprise liquidity and risk steering as a key tool that goes beyond short term cash management.

“By integrating data and the views from different CFO office functions, treasury should lead discussions and enable scenario-based insights modelling of financing decisions, strategic business scenarios and business performance against risk parameters for informed decision making and forward-looking steering of the business,” he says.

Data is the new power within an organisation and can therefore always be improved suggests van Dijl.

“While treasury should stick to their guns and not directly set commercial policy or directives, they can (and should) provide the necessary insights and advice upon which commercial decisions can be made,” he says. “The more these insights are supported by data analysis the better.”

According to Masquelier, key areas for improvement include:

• Use of AI/machine learning to anticipate liquidity gaps, FX exposures or working capital risks.

• Moving from static models to dynamic simulations tied to macroeconomic variables.

• Harmonising data flows across ERP, TMS, bank portals and market data feeds.

• Enabling real-time, decision-oriented dashboards for treasury and finance leadership.

• Integrating treasury with strategic planning to assess the cash impact of M&A, capex and dividends.

“Data lakes are too often scattered, incompatible, in different formats and ultimately unusable,” he says. “Standardisation, homogenisation and consolidation of this bulk data is necessary to ensure its intensive use and to create dynamic reports, dashboards and decision-making tools for C-level decision makers.”

Arijit Deshmukh, APMEA Treasury Manager for Kerry agrees that having access to real-time data – especially for the macro and micro economic changes that impact business decisions – would be helpful.

He goes on to describe a comprehensive treasury policy framework as essential for any organisation seeking to manage financial risk effectively and support strategic objectives on the basis that it facilitates stronger risk control, governance and strategic alignment as well as enhancing stakeholder confidence.

“It defines the role and scope of treasury and the mandate given by the CFO or board and formulates responsibilities,” says Westermaier. “This is essential to establish what set-up is needed to deliver on expectations and gives clarity to the various business stakeholders over what treasury is taking care of and what it isn’t.”

Masquelier suggests there are misconceptions around the degree of maturity of companies and their existing policies – which he says are often thin, old, obsolete, incomplete, ill-adapted and not aligned with current reality.

“They need to be reviewed regularly to ensure that they are optimised and in line with cash management and to provide a dynamic cadre adaptable to changing situations,” he adds, observing that a comprehensive treasury policy defines the company’s risk appetite, roles, controls and instruments – essential for governance, auditability and alignment – and ensures clarity on counterparty limits, hedging rules, payment approval workflows, investment guidelines and escalation procedures.

“The framework should be reviewed at least annually to ensure alignment with evolving business strategy, market conditions, regulatory requirements and technological changes,” says Deshmukh. “Ad hoc updates should be done if there are material changes such as new financial instruments, acquisitions or shifts in macroeconomic conditions. In these scenarios the policy should be reassessed and updated accordingly.”

This should serve as a reminder to ask the question ‘has something changed which needs to be reflected in the policy?’ and may not always lead to updates, says Westermaier.

“However, it prevents the policy framework from becoming outdated by forgetting it over the years,” he concludes. “Changes to the organisation (such as merger or acquisition) should lead to ad hoc reviews and updates to the policy outside the annual review cycle.”