Britta Dottger, head of treasury at Roche, believes CBDCs have the potential to transform the global financial system for the better and make daily treasury life easier
Britta Dottger, head of treasury at Roche, believes CBDCs have the potential to transform the global financial system for the better and make daily treasury life easier Read more
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The Covid-19 pandemic caused major disruption for many industries, but with lockdowns implemented around the world, supply chains certainly bore the brunt of this disruption.
Although managing and financing supply chains has always been a challenge for corporates and financial institutions, the disruptions caused by the pandemic shone exacerbated these ingrained issues. While the initial disruption affected the manufacturing process for many businesses, the post-pandemic effects have been more widespread, affecting the logistical chain too. And with global interest rates rising, the cash conversion of corporates is being stretched.
In addition, as globalisation continues, the challenges faced by treasurers have become even more tricky to navigate; supply chains are more dispersed, political conflict wages between Russia and Ukraine, and many economies are bracing themselves for an impending recession. Whether small are large, each of these disruptions is having an impact.
Meanwhile, corporations continue to look to create efficiency gains within their business to improve their bottom line. One corporation that found itself juggling these competing challenges was tech giant, Lenovo. Grappling with the disruptions saw the company find a solution in digitalisation.
“We went through [a period of] digitalisation at the beginning of the pandemic. With people working from home, we started implementing electronic processes, prior to that our supply chain financing was done manually. Going the digital route meant that our financing solutions became a lot more automated and efficient,” says Joseph Chua, head of global treasury operations at Lenovo.
Full visibility of the supply chain in an automated way means that everyone is working towards the same goal and is always on the same page. Lenovo accomplished this by using TASConnect, a secure supply chain finance platform that provides end-to-end automation and visibility of organisations that was launched by Standard Chartered’s SC Ventures this year.
“TASconnect creates an ecosystem between the anchors, the suppliers, and the financing institutions in a fully automated and digital way. Our approach was to develop a technology that was tailored to the anchor so that the implementation of the technology is easy,” says Gautam Jain of SC Ventures.
According to Chua, as the need for better efficiency within the treasury increases, the solution is to embrace digitalisation.
Index
00:00 Introductions
01:57 The effects of the Covid-19 pandemic on the supply chain
05:23 The challenges faced by treasury functions
06:44 The importance of full visibility of the supply chain
07:44 How do you supply full visibility
08:37 What is TASConnect and its purpose
13:01 How do businesses benefit Read more
Post-pandemic, the need to ensure businesses are building out sustainable growth channels is more important than ever before. For the treasury industry, this means providing their businesses with new ways to invest and manage their funds. But aligning cash management strategies with broader sustainability objectives is no mean feat – especially as many prepare for an impending global recession.
While many corporates have committed to the United Nations’ Sustainable Development Goals (SDGs), the goals are not designed to be applied at the treasury level.
“Normal business activity that occurs at the treasury level must be aligned with an SDG and that’s a formal process,” explains George Lee, Head of Transaction Banking at Standard Chartered Americas.
“It has to be auditable and accredited; you can’t just decide one day that you are doing it, you have work to do to be able to accredit yourself in that space and that’s a challenge.”
Standard Chartered recently launched its ‘Sustainable Account’; a new investment product, that has the characteristics of a Demand Deposit Account. It provides large corporates with the opportunity to contribute to sustainable development through the investment of surplus cash, whilst maintaining daily access to their finances.
“Sustainable demand accounts provide corporates with an opportunity to participate in sustainable development agenda by having their short-term surplus cash, […] referenced against Standard Chartered sustainable loans and projects,” says Lee.
“It is a simple way but fully automated and auditable solution that can be used to prove to the market that they are conducting sustainable activities.”
The options for where to inject this surplus cash are endless and while they can be industry-specific, that does not always need to be the case. Surplus cash can be used in tackling some of the world’s most significant long-term threats, including climate change, quality education, clean energy, and financial exclusion.
Lee highlighted the importance of these products for treasurers moving forward, and the risks to your business of not using them are high.
“You risk potential opportunities if sustainability is not a priority in your business. The more sustainable you are, the more applicable you are to new opportunities so it’s a growth tool,” says Lee.
“As the world turns more socially and sustainably conscious, you want to be on the right side of the fence and more especially if you have a mission statement that speaks to such a pursuit”.
INDEX:
00:00 Introduction
00:57 Why treasures have difficulty aligning with sustainability objectives
02:00 Advantages for businesses who meet their sustainability objectives
03:30 What exactly is a sustainable demand account
04:20 How demand accounts differ from other products in the market
05:20 What corporates risk by not aligning their cash management and sustainable objectives Read more
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