COVID-19 and reassembling the treasury function

Corporate treasurers have proved their resilience and worth as strategic advisers during the pandemic, says Caroline Stockmann

It’s been an unusual few months, to say the least – but a great opportunity in some ways to connect more with our members, whether through one-to-one calls or indeed via our recent International Treasury Week.

The focus during this time for The Association of Corporate Treasurers (ACT) has been to ensure we are supporting our members as best as we are able, hence the increased individual contact. So, when asked to consider what have been the common threads in people’s experiences, I can summarise as follows:

• The transition to working from home was smooth – treasurers were pretty well prepared, more so than the rest of their organisation in some cases, and certainly their banks, it seems.
• For those well-used to having credit facilities, access to liquidity was not an issue, and they could access more via government schemes in various geographies. But for those usually robust companies for which this was not the case, they have suffered and had an intense period trying to ensure survival of their company.
• Smaller organisations that don’t have professional treasury skills have really struggled, but larger organisations have generally been helpful in passing liquidity through their supply chain at accelerated rates, in order to help preserve the whole ‘ecosystem’.
• Mental health has been a major consideration of leaders in the treasury space, and they have been active in supporting their teams as well as their peers in some cases.
• Some have found this crisis less impactful than the 2008 financial crisis, but most have said that this one is far more challenging. That’s particularly so for those treasurers who did not experience 2008; they have found the situation a big shock to the system.
• Treasurers have worked harder than ever before, and their natural professionalism and focus on managing risk and coming up with solutions has allowed many to rise to the challenge successfully, and accordingly they have caught the attention of their CFO, CEO and board; they now need to retain that seat at the top table.

What’s next?

The next questions are: how will treasury teams reassemble themselves post-COVID-19? And what does the future look like for them? It seems clear that the world has changed in many ways during 2020, whether expressed by our political context, our economy or our behaviours. A return to what we had before seems unlikely, and one of the key areas of change will be how treasurers work in the future.

They have shown they can work from home, something that had often been challenged in the past. Even the banking sector, whose regulators seemingly couldn’t adjust to the idea of working from home, has demonstrated its feasibility.

However, we know from many conversations that treasurers are sociable creatures and do not relish a lifetime of pseudo-isolation. Although we expect to see a much greater proportion of work being carried out from the home office, non-virtual interactions will still form an important part of their future working life.

How the economy pans out, and who will not survive the crisis, remains to be seen, but the habit of treasurers to constantly horizon-scan and balance the financial risks they see with opportunities will hold them in good stead here.

Treasury teams will remember what it was like to work with their colleagues in a period of huge uncertainty, and they will value the care and empathy shown by their managers and peers.

Equally, they will have noted how their business relationships responded to them during the crisis, and that will be reflected in a shift of loyalties in some cases, or else a reinforcement of them in others. Being a trusted and supportive partner in these times will not go unrewarded.

And now that the treasurer has been seen, more than ever, as a true strategic partner, their influence for good in the future cannot be underestimated.

About the author

Caroline Stockmann is chief executive of The Association of Corporate Treasurers