A shift in strategy

A shift in strategy

The pandemic has eclipsed other risks that were previously high on the corporate agenda: environmental, weather and climate are now only in sixth place for 2020.

These findings are highlighted in a new report by The Economist Intelligence Unit (EIU), “The resilient treasury: Optimising strategy in the face of Covid-19”. It explores the forces that will shape and define the corporate treasury function and the priorities of the future. The research, supported by Deutsche Bank, is based on a global survey (conducted between April and May 2020) of 300 corporate treasury executives.

Pandemic risks will have the most impact on corporate treasury in the short term (43%) and medium term (27%). Other risks, notably concerns over global economic growth (31%) and geopolitical risks (25%) are also high on the list over the medium term. In response, treasurers plan to increase investments in long-term instruments (55%), bank deposits (48%) and local investment products (48%) over the next 12 to 24 months.

Treasurers have become increasingly reliant upon new technologies and data for their day-to-day activities as well. However, close to 80% of respondents are either very or somewhat concerned about the quality of data available within the business (a notable increase from last year’s survey, at 69%).

Having the correct skills within the treasury function to take advantage of new technologies is critical, and their efforts to upgrade their tech and data skills are starting to bear fruit: almost 30% of respondents say they have all the skills necessary to meet new challenges posed by technological change (compared to 22% in 2018).

Looking ahead, the priorities on the treasury agenda in 2020 are managing relationships with banks and suppliers (32%) and collaborating with other functions in the business (32%). 

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