Stake your claim now – or find yourself sidelined
Richard Raeburn, Chief Executive of the ACT, has issued a stark warning to treasurers over their future role within the organisation. His comments came in the context of organisations struggling to introduce effective enterprise risk management (ERM) practices. A major study, conducted jointly by the ACT and management consultancy Mercer Oliver Wyman, found that a host of barriers existed within European companies that prevented the implementation and use of ERM. Not surprisingly, the research focused on the role of the treasurer in the implementation of holistic ERM solutions.
Commenting on the research, Raeburn said: “Rising to the challenge of ERM is not simply a matter of persuading others in the firm. It also requires treasurers to educate themselves in new technical skills, best practices, non-financial risks and business strategy.
“Our research suggests that many treasurers prefer to accept the status quo, but also that things are changing. Treasurers have in the past been seen as the de facto deputy chief financial officer [CFO]. This might now be at risk as the focus of CFOs has moved to control/ accounting and strategic planning.
“As a consequence, treasurers may not be confident that they will step directly up to the CFO position and they cannot count on being left alone to manage their piece of the risk jigsaw forever. By taking a more proactive role on ERM, they will add value to the organisation and position themselves better as CFO candidates. The opportunity is there, and treasurers should grasp it.”
Treasurers have much to offer the organisation in terms of financial risk expertise, quantitative skill and market access. Risk has moved up the corporate agenda as business volatility continues to rise. And the profile of the treasurer should have increased in tandem.
Treasurers have traditionally never been good at explaining the role they perform and the value they can add within the finance function, never mind within the context of the enterprise as a whole. Treasury departments still have the opportunity to work with CFOs to deliver in the face of increased responsibilities. A few treasury departments have risen to the challenge, but not enough. Such modesty and reticence has to stop, both for the sake of the organisation and the sake of the treasury function.
PETER WILLIAMS
Editor
See Marketwatch Europe, page 07
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