The gtnews Awards for Global Corporate Treasury, sponsored by Bank of America Merrill Lynch (BofA Merrill), recognise the treasurers’ and teams who have done the most to contribute to the success of their organisation, wherever they are in the world.
Now in its third year, the Awards have a hard-earned reputation for authority and independence. Thejudging panel consists of working treasury professionals from AkzoNobel, Etihad, and Thomas Cook among other corporates, who are willing to use their real-world expertise to ensure that the very best examples of corporate treasury work are rewarded.
A member of the judging panel, Michael Connolly, vice president and treasurer of Tiffany & Co, who acted as compere for the evening, unveiled the winners in 2012. He said he was impressed by the “international-ness” of the entries and that, “the companies participating were from many different countries, with entries spanning many borders”.
According to Connolly, it is clear that treasurers face similar global challenges: managing risk across the enterprise; interacting effectively with diverse business units; working closely with technology teams; and fostering good partnerships with banks and others. “As a corporate treasurer myself,” he said, “it has been an honour to see how my colleagues have met these challenges and how they have succeeded in today’s financial environment.”
Another member of the judging panel, Craig Ehrnst, a certified treasury professional (CTP) and treasurer at NCCI Holdings, said he was impressed by “the scope and quality of the entries”, while Linda Williams, assistant group treasurer at Thomas Cook Group said she found them “inspiring”. According to Craig Busch, group treasurer at WorleyParsons, “the execution of the various projects was extremely high, which was even more impressive given the high degree of volatility that now exists in the markets that treasury operates in.”
For Anthony Scaglione, CTP, senior vice president (SVP) of merger and acquisition (M&A) and corporate treasurer at ABM Industries, “the entries showcased a broad base of industry expertise and, in some cases, leading edge solutions”, while fellow judging panel member, Rick Thirion, vice president of treasury at Etihad Airways, said he thought “the standard of submissions continues to improve year-by-year.”
There were 76 entries in total from 57 different treasury departments, spanning 11 different categories at the 2012 Awards for Global Corporate Treasury. The trophies were handed out in the evening of 24 May, following on from the opening of the gtnews Forum for Global Corporate Treasury, a two-day conference that examined the key topics, trends and challenges facing treasurers at present, with speakers from the European Central Bank (ECB) and European Payments Council (EPC) addressing issues such as the single euro payments area (SEPA) and the eurozone crisis, among much more.
The 2012 winners represent a revealing cross-section of all that is best in the world of treasury at this time and show how corporations are coping with the pressures of an increasingly globalised marketplace, economic recession and debt and departure fears in parts of the eurozone, allied to tight credit conditions and a raft of new regulatory compliance demands.
The 2012 Awards winners and highly commended entries were as follows (to see full project and category descriptions please click here):
Cash Flow Forecasting Project of the Year
Winner: UPS – Overcoming Data Aggravation
For the United Parcel Service (UPS) treasury team obtaining daily visibility into its bank balances across 1,600 accounts globally was anything but simple. Treasury implemented its global SWIFT bank balance initiative, integrating it into its global cash flow forecasting system, cutting the number of accounts held and achieving significant beneficial results for the company.
According to one of the judges during the scoring procedure, when comments and marks were being gathered under the anonymous ‘Chatham House’ rules, this UPS entry achieved, “a pretty outstanding result, decreasing bank accounts by 50%”, and was fully deserving of winning the category.
- Carlsberg – Liquidity Management Project.
- Merck – Global Restructuring of Cash Management Processes.
Foreign Exchange (FX) Project of the Year
Winner: SABMiller – Project Griffin, European Treasury Centre Implementation
Project Griffin at SABMiller built a European treasury centre to provide efficiencies and standardisation, and to enhance control and reduce risk and costs. Working with partners at Citi and IT2, Griffin achieved best practice project management results, generating a substantial range of savings and transparent workflow optimisation in foreign exchange (FX) pricing, cash and exposure forecasting.
“It is apparent that a very clear project plan was established [by SABMiller] and that the project team took a very disciplined approach to ensuring the objectives were met,” commented one member of the judging panel when deciding which entry was deserving of being the category award winner.
- Cognizant Treasury – FX Hedge Programme.
- Thai Airways – Comprehensive FX and Cash Management Solution.
Risk Management Project of the Year
Winner: Toyota Financial Services – A Sovereign Risk Protected Liquidity Solution
Toyota Financial Services effectively delivered a US$300m intercompany liquidity solution to its Brazilian affiliate. Political risk insurance was used to mitigate exposure to sovereign risk, thereby allowing the execution of offshore term loans that have saved the Brazilian operation US$16m in interest expenses.
For a case study overview of this entry please click here (look out for more case studies after the awards). “This [Toyota] solution can be applied to others. The issue is not credit, but sovereign country risk,” said one member of the judging panel.
- Aeroflot – Implementation of SAP in Transportation Industry Treasury.
- Henkel – Global Bank Account Visibility.
Shared Service/Payment Factories Project of the Year
Winner: Philips Electronics – Next Generation Philips Payment Factory (NGPPF)
The NGPPF provides Philips with greater control over the group bank infrastructure and payment processing. It also enables treasury to advise local affiliates on efficient working capital management, while at the same time improving trade credit management. Finally, it lays the foundation for enhanced cash flow forecasting.
According to one of the judges’ scoring comments, “this winning project successfully centralised all global cash management and payments processing for 25 countries and 15 currencies.”
- AB Sciex – Readiness Project.
- Dassault Systèmes – Treasury Using XML to Become a Key Support. For a case study of this highly commended entry please clickhere (look out for more case studies after the awards).
Supply Chain/Trade Finance Project of the Year
Winner: Merck KGaA – Global Guarantee Management (Letter of Credit)
A small internal project team of just two people, working with the assistance of Deutsche Bank, rose to the challenge of delivering a single worldwide, consolidated bank guarantee facility worth more than €150m. Valid for all 250 subsidiaries and using a single procedure and bank platform to minimise errors, the system also has automated reconciliation and fee management to cut costs and time.
One member of the judging panel commented about the winning Merck entry that he gave “the highest score to the two employees for their perseverance”, highlighting the small amount of resource allocated to such a large project and the success Merck enjoyed in “streamlining multiple banks down to a single bank guarantee provider, utilising automation and STP [straight-through processing] tools”.
- Foxconn Technology Group – Supply Chain Finance Programme.
- Stanley Black & Decker – Supply Chain Finance EMEA Expansion.
SWIFT Implementation Project of the Year
Winner: GE – Eco-imagination at Work
Receiving and warehousing e-statements: GE solved the problem of accessing and retaining bank account statement information for 14,000 accounts across more than 100 banking relationships and 98 countries by working with JP Morgan, BofA Merrill and SWIFT. The project will save GE US$1.5m, but more importantly it will eliminate the need to store paper documents and deliver critical process efficiencies.
According to one of the judges, speaking under the ‘Chatham House’ conditions of anonymity, this winning entry was “one of the best” and the “objectives were met with return on investment (ROI) being realised”.
- Johnson Controls International – SWIFTNet (TRAX) Implementation in Asia-Pacific/Middle East.
- eBay – SWIFT Implementation.
Working Capital Project of the Year
Winner: Microsoft – Taking Liquidity Structures to a Whole New Level
Microsoft’s implementation of a completely automated international zero balance account (ZBA) structure has been a game changer for global liquidity management. This initiative has streamlined the cash concentration for hundreds of bank accounts and created a just-in-time funding model for subsidiary operating accounts, all with 100% automation.
“The fact that Microsoft developed a scalable platform that was cost-effective and allowed it to reduce counterparty exposure and gain visibility is very impressive and what enabled it to win,” said one of the judges.
- Lehigh Hanson – E-payables Programme.
- Roche – Global Commercial Card Project.
Treasury Technology Implementation Project of the Year (Note: Four entries were shortlisted in this category due to the volume and quality of the entries and a tie in the scoring)
Winner: Toyota Motor Credit Corporation – Transforming to a Daily Collateral Exchange
Using Toyota’s Kaizen methodologies, the corporate treasury became the first to perform daily collateral exchanges with zero thresholds and same day settlement. In addition, unsecured exposure was cut from US$1bn to near zero, providing significant financial benefits to the company. Project partners included SWIFT, Bloomberg Valuation Services and Wall Street Systems.
Explaining why she personally gave the Toyota Collateral Exchange project a high winning rating, one of the judges’ described it as “pioneering work”, adding that “getting 23 banks to agree to a standard format is not a trivial obstacle to overcome”.
- Google Inc – M-Pesa Payments Project.
- Philips Electronics – Next Generation Philips Payment Factory (NGPPF).
- Celio International – Realising Celio’s Treasury Dream.
Treasury Team of the Year
Winner: QinetiQ – Delivering Best-in-class Treasury Services
Defence and security company QinetiQ’s treasury team of five people, working across the UK, North America and Australia, has delivered a fast and ambitious turnaround strategy, cutting debts and increasing working capital during a tough economic environment.
In praising the winning treasury team at QinetiQ, one of the senior members of the awards judging panel said they took “… some good and diverse steps to restore QinetiQ’s financial position.”
- Belron – Treasury Evolution.
- Live Nation – Integrated Global Cash and Risk Management Platform.
Corporate Treasurer of the Year (Readers’ Choice Award) (Note: This category is nominated by and voted on by readers)
Winner: Gary Bischoping Jr, Vice President and Treasurer, Dell
Under Gary Bischoping Junior, Dell transformed substantially all its worldwide operations to a single treasury management system (TMS). The TMS now handles treasury activities for more than 700 bank accounts in 100+ countries. Bischoping also created a centralised operations team in Bratislava, Slovakia. Now the Dell treasury operations team manages global cash positioning covering all EMEA and Americas time zones.
- Bill Lowe, SVP, Treasurer, Live Nation Entertainment.
- Lisa Stone, Group Treasurer, Belron Group.
Gold Award (Overall Winner)
This award is quite simply the highest scoring entry in the entire gtnews awards 2012. It recognises excellence in treasury management and honours the corporate treasury demonstrating innovation, best practice, and operating as a strategic partner to the business.
Winner: Merck KGaA – Global Guarantee Management (Letter of Credit)
Entered into the Supply Chain/Trade Finance category, this small internal project team consisting of just two people, and working with the assistance of Deutsche Bank, rose to the challenge of delivering a single worldwide, consolidated bank guarantee facility worth more than €150m. Valid for all 250 subsidiaries and using a single procedure and bank platform to minimise errors, the system also has automated reconciliation and fee management to cut costs and time.
“BofA Merrill would like to congratulate all the winners and highly commended entrants in the gtnews Awards for Global Corporate Treasury 2012. We are delighted to be sponsoring these awards and are glad that everyone had an exciting evening at the Sofitel Grand Hotel in Amsterdam on 24 May celebrating their victory,” said Carole Berndt, head of global transaction services for Europe, Middle East and Africa (EMEA) at Bank of America Merrill Lynch. “These peer-reviewed awards demonstrate excellence in global corporate treasury and the winners are truly deserving of the accolade.
“Against the backdrop of the eurozone crisis and continuing economic uncertainty, the mood was still buoyant and everyone enjoyed themselves, while sharing knowledge and experience. Whether you’ve won tonight or not congratulations on your efforts.”
Responding to the night’s festivities, Roland Rechtsteiner, a partner at the Oiler Wyman consultancy, said that “it was a lovely evening” and that “there were some great, deserving winners”.
One of the most prominent winners of the evening was Merck, which won the Gold Award at the 2012 gtnews Awards with their top scoring entry into the Supply Chain/Trade Finance Project of the Year category entry, which garnered the highest score among all the entries. According to Joerg Bermuller, director and head of cash and risk management, corporate finance and treasury at the pharmaceutical firm, “I’m very happy to get such a prestigious award from gtnews,” he said.
“I can show this award to the board and say, look this is what we’ve achieved against competition from major multinational car manufacturers and various other significant treasury departments. I am very very happy with the accolade.”
There has been an uptick of treasurers inquiring about interest rate risk management in recent months as interest rates in the US and UK have started to show a rise in momentum, said Chatham Financial at the annual Bellin treasury conference.
The global economy has seen about eight years of growth, but we are starting to see the end of this which is triggering some volatility in global markets, Stefan Bielmeier, DZ Bank, argued in his keynote speech at the Bellin annual 1TC conference. Other speakers discussed blockchain, cyber crime and netting.
A series of governments are now very worried about the idea of bitcoin and these currencies because customers would be able to make sustainable ongoing transactions and payments without having to ever introduce the use of a typical financial model or banking system. To combat this potential threat, several countries including major central banks like the Bank of England and the Bank of Israel will be launching their own version of a cryptocurrency. This could bring big advantages to customers.
Once there is KYC blockchain, the technology will be at the forefront of helping to identify those who present a greater risk of criminality, argues David Poltorak, chief technology officer at Fortytwo Data.