Transformation projects, AI adoption, and the need to run the treasury function as efficiently and cost-effectively as possible; all need to be underpinned by strong governance. It is not simply a matter of good, but generic, housekeeping, attendees at this year’s ACT Annual Conference learnt.
Effective governance has a positive impact on the overall performance and optimisation of the treasury function. It also helps organisations remain compliant and on the right side of the regulator, which in itself makes for better efficiency and optimisation.
The foundations of good governance lie in exploring the frameworks and controls organisations need in place before treasury teams can safely and effectively use and move their data. Establishing a culture of governance is increasingly becoming a core part of enabling treasury transformation and operational resilience.
Speaking at the conference, Dan Luther, head of treasury at The British Standards Institution (BSI), cited education and culture as a massive influence on the success of governance. “There is a big educational piece around all this and the need to strike a balance between agility and governance. We need to have secure and well-governed systems and data, but we also need to be able to move quickly if needed while staying legal and compliant.”
He also pointed out that a culture of governance means understanding both the scope and the purpose behind controls. “We don’t need to use a sledgehammer to crack a nut, so for example, not everything needs to be real-time. In this context, governance becomes about optimisation and purpose,” he said.
Typically, a starting point would be a framework of who owns what, what's the strategy, where things are housed, what the impact of any incoming regulations will be – especially if your organisation is cross-border – and how the data can be used within those regulatory constraints.
One thing that can be useful at this stage is creating a data dictionary that is regularly updated and sets these things out clearly. It also needs to have easily understandable and accessible metadata behind every update so that you can always see who updated what. This not only strengthens control and accountability but also helps treasury teams work more efficiently and confidently with consistent information.
The next logical step in the governance process is architecture. This is more about accessing information held in different systems, deciding how and when to share and move it, and the security protocols that surround it.
Ideally, the architecture should involve internal security in that access is limited to those who need it and also external governance in that information cannot routinely be sent outside of the organisation. Strong governance structures in these areas can help treasury teams optimise processes, reduce duplication and support more reliable reporting and decision-making.
This also plays into cybersecurity – making sure that would-be criminals cannot access data and that staff have an ingrained culture of cyber awareness and information protection. A culture of governance is critical here, ensuring that controls are consistently understood and followed across the organisation rather than viewed as a standalone compliance exercise.
Too many people mistake good governance for making information accessible, but the danger is that it turns into a free-for-all with the inherent risks around security
James Corrigan AMCT, senior finance manager at Skyscanner (pictured above), said: “Information segregation is critical. Decisions over admin rights and other accesses keep you compliant and secure. Too many people mistake good governance for making information accessible, but the danger is that it turns into a free-for-all with the inherent risks around security. It also risks people holding their own version of information and making edits to it that fall outside of agreed formats and structures, eventually leading to multiple sets of data that are inaccurate and out-of-date.
“Oversight over controls and guardrails is crucial,” he added.
Ultimately, governance is most effective when it becomes embedded within treasury culture rather than treated as a standalone control function. Organisations that build strong governance frameworks are not only better positioned to remain compliant, but also to optimise treasury operations, improve decision-making and adopt new technologies with greater confidence.
Alison Ebbage is a technology journalist
