The EACT Treasury Survey 2024, conducted by the European Association of Corporate Treasurers (EACT) and based on some 250 contributions, takes stock of challenges faced by European multinational corporations’ (MNCs) treasurers over the past year and highlights their top priorities for the next 12 to 24 months, offering valuable insight into trends, expectations and long-term goals.
Long-term funding remains top of mind
Securing long-term funding at a time of higher interest rates emerged as the key priority for treasurers in this year’s survey, as they ensure the long-term viability of their organisations. Meanwhile, cashflow forecasting was a close second. This focus consistently ranks among key priorities and remains a major interest for corporate treasurers, as shown in the recent Journeys to Treasury report.
Capital structure was another focal point, highlighting the importance of recapitalisation of multinational corporations, along with digitisation of treasury, working capital management and bank relationships.
Technological innovation a major driver
Technological innovation remains a key driver for the treasury function, and the maturity of these solutions leads to greater expectations for enhanced cash management.
According to Aurélia Normand, Head of Global Transaction Banking and Global Head of Network Banking BNP Paribas CIB: “Digitisation, new technologies and innovation are top of list for treasurers in addressing challenges and threats, as they seek to elevate treasury management to a new level of proficiency and adaptability.”
❝ Digitisation, new technologies and innovation are top of list for treasurers in addressing challenges and threats, as they seek to elevate treasury management to a new level of proficiency and adaptability. ❞
This year has seen a lesser emphasis on artificial intelligence (AI), cryptos and distributed ledger technology (DLT), along with a return to simpler topics, suggesting a possible intention to prioritise day-to-day management and current treasury management systems before adopting other new technologies. Treasurers are taking a pragmatic approach in this respect and will focus first and foremost on cloud solutions and the use of data analytics over the next 12 months. Application programming interfaces (APIs), Treasury as a Service (TaaS), robotics process automation (RPA) and hyperautomation feature among other priorities.
Entering the era of everything real time
Real-time reporting and dashboarding is the top-ranking topic of great interest for treasurers for the next 12 to 24 months. Real-time payments and collections are increasingly important to optimise treasury operations, along with automated management of foreign exchange risks, as treasurers look to replace outdated manual processes with advanced automation to enhance efficiency and control.
European treasurers are taking a greater interest in fintech solutions as compared to previous years, similarly to their counterparts in Asia.
According to Steven Lenaerts, Global Head of Digital Channels, BNP Paribas Cash Management: “With the multitude of IT systems in treasury departments as well as the number of entities and bank accounts, the integration and fluidity of financial data is a top priority for treasurers as they improve security and forecasting accuracy and tackle the increased risk of fraud and cyber threats.”
❝ With the multitude of IT systems in treasury departments as well as the number of entities and bank accounts, the integration and fluidity of financial data is a top priority for treasurers as they improve security and forecasting accuracy and tackle the increased risk of fraud and cyber threats. ❞
Working capital management and treasury centralisation
Treasurers plan to use a range of instruments over the next 12 months to ensure effective working capital optimisation. These include payment terms, supply chain finance enhancement and factoring, as well as cashflow forecasting tools.
More than 20% of treasurers see difficulties in standardising processes and weak internal controls as major obstacles to further centralising treasury services, although trends were stable for 2023 and 2024. Managing the continuum of economic, human, financial and regulatory changes, rather than the changes themselves, presented the real challenge.
Supporting the ESG agenda
Client engagement is increasing on Environmental, Social, and Governance (ESG) principles, including at Treasury level as more and more corporates set tangible and ambitious ESG targets for themselves and their key stakeholders across their value chain. Corporates are increasingly embracing Sustainable Transaction Banking as a catalyst in their transition, notably to broaden their sustainable finance approaches and address specific areas e.g. corporate supply chains. Banks’ commitment on ESG becomes a key decision criterion in transaction banking business allocation.
The impact of financial regulations on treasury
Regulation can add further burden for treasurers, with a number of regulatory changes in sight, including ESG reporting, ISO 20022, European Market Infrastructure Regulation (EMIR) review, Markets in Financial Instruments Directive (MiFID) review, Money Market Funds (MMFs), Payment Services Directive 3 review, proposed EU regulation on VAT in the Digital Age, and the introduction of instant payments.
According to Wim Grosemans, Global Head of Product Management, Payments & Receivables, BNP Paribas: “As treasurers continuously adapt to simultaneous and overlapping economic, financial and regulatory changes, the need to digitise and accelerate transformation to tackle the range of challenges they face is key.”
❝ As treasurers continuously adapt to simultaneous and overlapping economic, financial and regulatory changes, the need to digitise and accelerate transformation to tackle the range of challenges they face is key. ❞