The top 6 responsibilities of a corporate treasurer

corporate treasurer's responsibilities

Last modified on March 14th, 2024

Corporate treasurers manage the financial assets and risks of an organization. For Heineken, this includes trading and protecting aluminum assets — a staple for their production of beer cans. Read on to learn about today’s corporate treasurer’s responsibilities, and how they benefit your organization’s long-term financial health.

Trustpair is the ultimate tool for treasury teams. Thanks to ongoing validation, our software prevents third-party fraud from happening and streamlines your business processes. Request a demo to learn more!

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Cash management

The historical role corporate treasurer is to take care of an organization’s cash. The corporate treasurer’s responsibilities are primarily to ensure that there is enough working capital to meet the company’s obligations. That means paying employees and suppliers, giving dividends to shareholders, etc.

Corporate treasury management comes with its challenges in 2024. There is heightened political and economic uncertainty, and dealing with the rising costs is part of the day-to-day of many treasurers.

Cash flow is the most important factor in a business: most businesses fail because they run out of cash and have to file for bankruptcy.

The main job of corporate treasurers is to ensure that this doesn’t happen. For that, they carefully monitor the business cash inflows and outflows:

  • In the present by checking the business bank accounts daily.
  • In the future (short term and long term) by creating various cash flow forecasting models.

Treasurers work closely with Chief Financial Officers to optimize the working capital of their business so it keeps on thriving no matter what.

 

Financial analysis

But corporate treasurer responsibilities don’t stop at cash liquidity management. They have to go deeper and see what could influence their global cash and potentially jeopardize their company.

To do so, treasurers need to keep an eye on several financial elements, such as:

  • Relevant KPIs for their company and industry (profit margin, DSO, etc.).
  • Foreign exchange rates, which influence the assets of international companies.

Treasury professionals are usually in charge of running sensitivity analyses to reduce the uncertainty regarding their cash flow and global assets.

 

Asset management

Corporate treasurers manage organizations’ assets at large — meaning cash management investment. They do asset liability management for:

  • Credits extended to customers (accounts receivable) or other entities.
  • Shares invested in other ventures.
  • Tangible assets such as properties or machinery.
  • Intangible assets such as patents and intellectual properties.

They have to monitor and balance the risks of each, but also decide where to allocate the money and assets they have. The main corporate treasury function is to optimize the assets of the company so it always gains value and can keep on thriving.

 

Corporate finance

Treasurers make strategic recommendations to top management as to where to allocate their funds. For example, if there is a surplus of cash flow, it’s up to the corporate treasury to decide its best use:

  • Investments,
  • Debt repayment,
  • New projects

In the same way, they’ll need to choose how to finance operational and strategic projects for the long-term well-being of their company.

For example, if their company decides to develop a new product:

  1. They’ll assess the viability and profitability of the project,
  2. They’ll weigh their different financing options between:
    1. Asking for a business loan,
    2. Selling assets,
    3. Using their savings,
    4. Raising capital with investors.

Today’s corporate treasurers’ roles include making strategic decisions for both the short and long term. They give their data-based recommendations on the projects companies undertake and work to make top management’s strategic goals a reality. They tend to work closely with Chief Financial Officers (CFOs), especially when it comes to financial planning.

In brief, corporate treasury departments are now essential to business and help steer the company where it wants to go.

 

Financial negotiation

The treasury function doesn’t only deal with numbers. The best corporate treasurers know that interpersonal skills are an equal part of their job description.

They need good people skills to succeed in this role, as treasurers have to deal with people from diverse backgrounds. That’s especially true when it comes to negotiation, another of the corporate treasurer’s responsibilities.

Treasurers have to negotiate the best financial terms for their company when it comes to:

  • Raising capital from investors and VCs (amount asked, share value, etc.).
  • Borrow money from bankers (in the form of loans or overdrafts).
  • Contracting insurance (price and coverage).

They also have to liaise with various people within the company, from operations to the CEO.

 

Risk management

Mapping out all your business risks

Last but not least of the corporate treasurer’s responsibilities: risk mitigation. Besides asset management, this is the most important one. Without risk management activities, it could all disappear overnight.

A corporate treasurer’s role is to map out all the financial risks, such as:

  • Liquidity: for example a lower demand than expected.
  • Credit: clients not paying their accounts receivable.
  • Currency: foreign exchange rate dipping.
  • Interest rates: interest rate commodity rising too high.
  • Operational: strikes or interruption of the supply chain.
  • Supplier risks: accounts payable fraud.

Once assessed, those risks need to be mitigated, for example by creating contingency plans. Any of the above elements going wrong could have huge negative consequences for the business.

Supplier risk management is crucial for example to ensure that you have the goods and services necessary for your company to keep operating.

Protecting yourself from third-party fraud

Sadly, third-party fraud is nowadays a real risk for all businesses. 96% of US companies were targeted by at least one fraud attempt last year, with an average loss of $100,000 per fraud event.

Fraudsters have no problem impersonating suppliers, tax controllers, or even your own CEO to defraud your business. They target financial, accounting, and treasury departments as they know their employees have direct access to the company’s banking information.

Corporate treasurers also have to plan against those risks to ensure their company’s cash isn’t stolen; resulting in direct and indirect financial losses (the indirect coming from a loss of reputation).

That’s where Trustpair comes in. We completely eradicate the risks of third-party fraud in your business by continuously checking the credentials of your suppliers. Our software detects any attempt of fraud by using three-way matching to check your recipients are really who you think they are.

With Trustpair, you always know who you’re paying. We work with international companies that have suppliers abroad and integrate with the main accounting and treasury management systems (and ERPs).

Using our software also means reducing the time your treasury teams spend on manual account validation, which is both time-consuming and error-prone. Trustpair helps streamline your treasury processes, providing a secure space to collaborate between departments and optimizing your workflows.

Learn more about the Treasurer’s changing function in our latest white paper!

future of treasury in the digital age white paper
Key Takeaways:

Corporate treasurer responsibilities are numerous, going from asset management to risk mitigation. Successful treasurers have a real say in a company’s strategic decisions and therefore highly valued in the company. They can protect their company’s cash flow and eradicate the risks of third-party fraud by using Trustpair, our anti-fraud software.

FAQ

The function of corporate treasury is to optimize and protect the assets of an organization: its cash flow but also its various tangible and intangible assets. Risk mitigation is a big part of the treasurer’s job description. They work under the Chief Financial Officer CFO.

Trustpair helps treasury teams eradicate the risk of third-party fraud completely. Our software runs automatic and real-time checks of your suppliers’ credentials, so you always know who you’re paying. Plus, we help streamline your treasury processes by providing a secure space to collaborate, deleting unnecessary steps, and reducing the time spent on account validation.

Manage the risks related to corporate treasury.

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