Following on from the economic storm at the end of 2008, most chief financial officers (CFO) were faced with several tasks: to strengthen the balance sheet, to refinance debt and to place increased focus on the visibility of short and long term cash positions. The agenda for treasurers was set accordingly, and despite being a challenging period, most have benefited from an improved profile and increased exposure across the business.
In addition to the priorities outlined above, there has been increasing pressure for the treasurer to develop their skill set and role beyond what is widely recognised to be their traditional responsibilities. In the majority of businesses, gone are the days when a treasurer was simply involved in cash management and arranging debt. Increasingly, the role of the treasurer is broadening to add other functions, including tax, insurance, pensions and investor relations. Given their specialist skills, such as understanding complex cash flows, risk and financing, the treasurer is well placed to work alongside their CFO and add input into strategic business decisions and support investor relations.
Alongside their formal responsibilities, most treasurers have spent the past few years focusing time and resource around project work to streamline operations, improving IT systems and non-IT led processes and building relationships with the wider business.
Through developments in IT systems, it has been possible for much of the time-consuming processes surrounding cash/risk management to be automated and even outsourced, therefore increasing departmental efficiency and enabling considerably more time to be spent on the career enhancing strategic responsibilities that many treasurers crave.
Given the increased exposure that more treasurers have had in recent times, developing softer skills around both written and verbal communication is absolutely essential. Treasurers must be able to demonstrate their ability to build strong relationships with the wider business, translating complex treasury issues into simple terms for senior management, subsidiary businesses and external stakeholders alike.
Time for a Change?
Whether a treasurer is looking to improve their profile for an internal move, positioning themselves for an external move or even looking to take a step towards their first CFO appointment, it is vital for treasurers to recognise the changing nature of their role and the value they can add beyond their traditional responsibilities.
At a senior level, the treasury recruitment market has never been particularly volatile. Given the post-crisis challenges treasurers are faced with, there hasn’t been much movement, resulting in a relatively quiet market. Now that the dust has settled and the market is picking up, many treasurers are beginning to consider what their options are for progression, both internally and externally.
There a number of internal routes that are available to a treasurer although almost all depend on developing internal relationships, whether to broaden the remit of an existing role or move into another role such as financial controller or CFO. Again, it is vital that treasurers position themselves to take on additional responsibilities, adapting to the demands of the business and in turn adding as much value as possible to any strategic decision support process.
When looking at the external recruitment market for treasurer appointments, it is important to consider the changes and restructuring that most businesses have been through since the end of 2008. In addition to the key issues of refinancing and liquidity, a treasurer who has effectively managed change projects is of considerable value in the marketplace. In today’s competitive market, Treasurers must challenge themselves and avoid becoming pigeonholed in a linear role that lacks opportunity for diversification and/or promotion.
The Move to CFO
For treasurers who are looking to progress to their first CFO position, it can be a considerable challenge which involves careful career planning. Treasurers must ensure that they gain as much strategic exposure as possible, emphasising the value they can add and in turn helping to support decisions around corporate strategy. It is vital to push the boundaries and work on as much corporate activity as possible, building strong operational and board level relations to gain as all important advocates. It is strongly recommended that treasurers involve themselves in the management reporting process and even consider a sideways move towards group financial controller. Treasurers with a significant level of group reporting and forecasting experience are a valuable commodity and considerably more employable as CFOs. It is no surprise that the best way to do this is internally.
Overall, it is clear that in the last few years, since the recession, the treasury landscape has changed dramatically. Businesses are under pressure to keep liquidity and risk at the top of their agenda and this has placed treasurers in the spot light, particularly at board level. Whilst this can create unprecedented opportunities for treasurers to broaden their careers and even progress into CFO positions, as employment markets get tougher, it is imperative that personal career management is at the top of every treasurer’s agenda.