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Unveiling treasury excellence: Insights from global giants at the forefront of treasury innovation

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In the dynamic world of corporate finance, treasury management stands as a critical pillar of organisational success. 

The 2023 EuroFinance International Treasury Management conference offered a glimpse into the innovative strategies employed by some of the world’s leading corporations. In the heart of Barcelona, we had the privilege of hearing from four treasury innovators who are reshaping the landscape. From Carrefour’s agile approach to cash management to Adidas’s technology-driven operations, these discussions shed light on how these giants are redefining treasury management.

Adidas: Harnessing technology for streamlined treasury operations

Pioneering the frontier of treasury management innovation, Adidas has embarked on a transformative journey, leveraging technology to revolutionise their operational efficiency. As Marc Andre Mohn, corporate treasury director at adidas revealed in the panel discussion, the company’s strategic focus on technology integration and centralisation is shaping a new era in their financial management.

Adidas’s choice to operate with a third-party ERP and treasury management system signifies a strategic integration of technology into their core operations. This integration facilitates a seamless flow of financial data, enabling more accurate cash positioning and effective decision-making. Mohn’s emphasis on leveraging these systems underscores the company’s commitment to technological advancement: “We’re striving for more integration, particularly on cash management topics.”

The centralisation of cash management, with a keen focus on handling bank accounts globally, is a testament to Adidas’s pursuit of efficiency. The treasury team’s initiative to create leaner banking structures and optimise cash management processes is a key aspect of their strategy, aiming to reduce operational costs and enhance financial transparency. These structures allow for greater agility in managing liquidity across different markets and currencies, a crucial factor in the fast-paced retail industry. 

However, the global footprint of adidas brings unique challenges, particularly in managing cash across diverse regulatory environments. The treasury team’s ability to skillfully coordinate with multiple regions and navigate these challenges demonstrates their adeptness in global cash management. Mohn’s insights highlight the importance of not only technological tools but also the strategic acumen in addressing these complexities.

Looking ahead, the treasury team is set to continuously improve their operations by further leveraging technology. 

Carrefour’s strategic cash management: Evolving with agility

Carrefour, a global retail giant, has undergone a significant transformation in its treasury management practices to address the complexities of operating in a rapidly changing environment. Facing challenges inherent to managing finances across diverse international markets, Carrefour’s treasury team embarked on a journey to refine their cash management strategy. This process was pivotal in adapting to the dynamic global financial landscape, demonstrating the critical role of agility and strategic foresight in modern corporate treasury management.

The treasury team’s decisive move to centralise operations marked a transition from localised management to a more integrated global approach. This strategic shift was essential in enhancing control over financial resources and reducing the risks associated with decentralised systems. As Nicolas Murat, director of cash management and treasury systems, highlighted, this centralisation aimed to “reduce local risk, as cash within the country is no longer on the local bank,” reflecting a commitment to mitigate counterparty risks while improving efficiency and visibility.

Confronting unique challenges in markets like Brazil and Argentina, each with its own regulatory and operational complexities, the Carrefour treasury team adopted strategies rooted in a deep understanding of local market nuances and strong banking partnerships. Murat’s insights into navigating these markets underscored the necessity for adaptability in such diverse financial environments.

In response to evolving financial conditions and the pressures of the COVID-19 pandemic, the team effectively integrated advanced treasury management systems and multi-bank platforms. This technological advancement was designed to enhance agility and responsiveness, balancing the need for cutting-edge tools with the requirement to maintain cost efficiency in a margin-sensitive industry.

Furthermore, the treasury team has not only navigated the immediate challenges but also laid the groundwork for a resilient, future-ready treasury function. This approach is indicative of broader industry trends, where centralization, technological integration, and strategic risk management are increasingly vital for navigating the complexities of global finance.

AbbVie: Crafting a unified treasury landscape

AbbVie’s treasury management exemplifies a dynamic approach to establishing a unified treasury landscape. The multinational healthcare company, known for its innovation in therapeutics, has strategically structured its treasury operations to align with its global presence and still be able to meet all local and regional regulations and requirements. 

AbbVie’s global presence, with sales in virtually every country, necessitates a sophisticated treasury structure. The company has divided its treasury centres into four key regions: JAPAC, Latin America, EMEA, and North America. This regional approach, coupled with centralization by an in-house bank in the Netherlands and a robust corporate presence in the US, ensures tailored management of financial operations to suit the diverse needs and regulations of each area.

A standout feature of AbbVie’s treasury operations is the utilisation of a single ERP instance for its entire treasury landscape. As Hans Dunnik, EMEA treasury manager at AbbVie, highlighted, this centralised ERP system is pivotal in managing payments and cash positions efficiently. Almost 95% of AbbVie’s payments are initiated through SAP, showcasing the system’s robustness and the treasury team’s commitment to leveraging technology for operational efficiency.

AbbVie’s treasury team has made significant strides in streamlining payment processes and enhancing cash forecasting capabilities. Furthermore, the continuous exploration of new technologies and methodologies in cash forecasting, including potential AI integration, speaks to their forward-thinking mindset.

The synergy between the treasury team and other departments, particularly IT and tax, is a key element of their success. Collaborating closely with IT enables the team to maximise the potential of their SAP system, while coordination with the tax department ensures compliance and strategic financial planning. This interdepartmental collaboration enhances the overall effectiveness of their treasury operations.

Throughout the event, speakers from diverse backgrounds collectively acknowledged the evolving landscape of treasury management. They consistently emphasised the imperative for agility, technological integration, and strategic partnerships. It was a consensus that the future of treasury management hinges on embracing innovative solutions, nurturing robust bank relationships, and continuously adapting to the dynamic financial environment. Furthermore, several sessions highlighted the significance of internal human capabilities, with examples such as AbbVie’s strong internal relationships serving as notable illustrations.