A Game of trust - trust is an ever-more critical success factor


A Game of trust - trust is an ever-more critical success factor

18 Jun, 2018

Marguerite Burghardt shares with us her vision of the Corporate Treasury Insights 2018 and the two key themes of the study – trust and delivery excellence

The Corporate Treasury Insights 2018 is a study created by BNP Paribas and the Boston Consulting Group based on a proprietary cross-industry survey of corporate treasurers and CFOs from around the world. Two prior editions were carried out in 2015 and 2016. This new 2018 study focused on two important topics: trust and delivery excellence.

Why was it important for BNP Paribas to initiate and carry out the 2018 Corporate Treasury Insights study?

Marguerite Burghardt: The study is important for BNP Paribas on two levels. First in terms of thought leadership, having our brand up on this major study that investigates what treasurers except from their transaction partners in general (not just from banks) is a way of keeping BNP Paribas very visible as one of the leading banks in transaction banking. Secondly we are going to use the results of the survey to understand how we can improve our own services to treasurers. It is particularly interesting to be already at the 3rd edition as we can capitalize on several years of results.

Who did you interview for this study?

MB: The study was developed based on a proprietary cross-industry survey of 700 corporate treasurers and CFOs from organizations around the world with consolidated annual revenue of more than $500 million. The study also included interviews with approximately 20 corporate treasurers and CFOs from multinational organizations to bring more depth and details to the findings.

This year the study focused on two major themes, delivery excellence and trust. Why did these 2 topics seem particularly important?

MB: Trust is a very contemporary topic, and so is delivery excellence. We have discovered that to gain treasurers' trust there is a balanced equation to find that includes inherent trust, delivery excellence and relationship excellence. Banks are naturally well positioned in terms of inherent trust as they are highly regulated entities. Furthermore, treasurers tend to trust someone that trusts them as well: by committing their balance sheet, banks show their trust to a company. But if banks just count on their inherent trust without developing delivery excellence and relationship excellence they are going to loose momentum.

What are treasurers expecting from their partners in terms of delivery excellence?

MB: Delivery excellence is an absolute prerequisite nowadays, not a nice to have. We are well aware of that at BNP Paribas and are focused on delivery excellence. In order to improve our services and therefore comply with our clients' expectations on the matter, we recently developed a new Connexis Trade platform.
"Delivery excellence is an absolute prerequisite nowadays, not a nice to have."
Additionally, it has become clear over the recent years that delivery excellence is critical at 2 levels, first in the day-to-day transactions, cash flow and liquidity related operations (so the large volume operations), but also for the custom-made services such as ad hoc supply chain solutions. On these tailor-made services, the treasurer also expects delivery excellence from its transaction partners.

You also talked about relationship excellence, what does this mean for treasurers?

MB: In treasurers' view, relationship excellence must be based on proactivity. They expect their transaction partners to know their business intimately. In my view this expectation from treasurers converges with a bank's natural business model based on managing credit risk. To be able to take the right risks, a bank needs to know and understand its clients' business models in great detail. So all in all, what treasurers expect from their transaction partners is very much in line with what a bank should fundamentally be.

Did the study show some significant differences between companies?

MB: Yes, in terms of geography in particular. While there is an explicit call for more proactivity in all regions, treasurers in North America and Latin America put greater emphasis on service level, whereas treasurers in Asia Pacific put emphasis on strong IT systems, and treasurers in Europe and Middle-East consider a customized relationship to be more important. Therefore, it requests a focused and tailor-made approach to actually address treasurers' real issues and expectations.
"[...] treasurers tend to trust someone that trusts them as well [...]"

What were the significant changes or evolutions compared to the previous reports?

MB: I would say that there were 2 major evolutions in 2018 vs 2015/2016: firstly the emergence of the need to use mobile devices to execute transactions (versus consult data up to now); and secondly cyber security that has become omnipresent.

How is BNP Paribas going to use the results of this report?

MB: We will analyze the results of the report to improve our own services to treasurers. We are planning to go even further than with the previous reports in the analysis by geographic area, by industry and by company size. As an example, we believe that co-designing products and services with our clients is critical and the best way to improve on the relationship excellence factor. This study confirms how important relationship excellence is. For example, we are currently co-designing with our clients a tool called « Trade Bot ». It's a chat tool based on artificial intelligence to automate the emission of standard guaranties. I think the study confirms that we need to multiply this type of initiative and aim to be a leading partner in co-designing transaction tools and services.

Head of Trade Finance Competence Center - Group BNP Paribas
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