Benjamin Defays

 

The Treasury Market Failure

THE ECONOMIC RECOVERY HAS GIVEN MORE BUDGETARY SPACE FOR FINANCIAL INNOVATION INITIATIVES WHICH IS GREATLY CHANGING
THE PROFILES SOUGHT AFTER ON THE JOB MARKET. INDEED, THE AUTOMATION OF LOW ADDED-VALUE TASKS IS CREATING NEEDS FOR MORE SOFT & TECHNICAL SKILLS, AND THIS IS FOR THE BEST FOR FINANCE PROFESSIONALS.

 

Of course, some roles will be made redundant due to this huge transformation, but we should not be afraid of new technologies as these will sup- port us in bringing more value to our businesses, and to our daily work as well, making it more exciting and rewarding. The challenge in this huge industrial move is to prepare ourselves with new skills. You’ll soon see new colleagues named RPA (Robotic Process Automation), blockchain, big data analytics with the support of AI (Artificial Intelligence), VAM (Virtual Account Management), Swift GPI... It’s not the first time in history that we see such industrial change where humans have to adapt their skills and aptitude to find their way in a new working environment in order to stay alive. Change is not only something nice, it’s something we have to integrate into our DNA because it is unavoidable. We keep saying treasurers are heading towards a more strategic role: well, this is exactly how we’ll be able to free up some time to be spent on creating real value to our internal customers. Without robotization & automation, how can we possibly achieve this? What if we rejected this idea and decided that it was a threat for our own jobs? Would we remain competitive compared to other countries? Would we keep our jobs? Certainly not. 

To that regard, the financial sector, especially in treasury, is reaching a point of market failure, at least in Luxembourg, where the supply of skilled workforce does not follow the increasing demand coming from Corporates who are looking to implement and/or develop their treasury centers. This is the reason why (constant) training is a must if you wish to survive, professionally. As a Treasury Association, we have a natural obligation to
help Corporates attract and retain their future treasury “superstars” over-time, which is far from being an easy task. No matter what the level of difficulty can be, it is key for the sustainability of the function as we cannot
stay in this overheating situation where wage costs never stop increasing due to the lack of skilled workforce supply. These overhead costs are putting pressure on the companies’ earnings as they have to replicate this on their sales price in order to secure a decent margin, which as a result is jeopardizing their competitiveness, hence the stability of Luxembourg as a preferred location for implementing a financial/treasury center. If you work as a treasury professional in Luxembourg, you should be concerned about this. Today, we’re in a typical situation where employees only see the short-term benefits of this (short-term) situation, while their career is in front of an absolute risk either because they don’t see the urge of being up-to-date and trained regularly, or because their attractiveness (and their price) is solely based on a scarce resource situation which Corporates could easily overcome by implementing their treasury department somewhere else. 

ATEL has been physically meeting with students looking for a financial career and introducing them to treasury, in view of transferring some of our passion for the function and attract them to Luxembourg. In parallel, ATEL has initiated its first treasury cursus which started in February 2019 in cooperation with the House of Training of Luxembourg, which covers cash & liquidity management, trade finance, credit control, advance excel for finance professionals, pension, insurance, risk management, compliance... a challenging program for those willing to perfect their knowledge into treasury and bring value to work the next day. In addition, ATEL has privileged contacts and partnerships with recruitment companies and professional mentors in order to help both the offer and demand to gain in visibility. Treasury has always been a difficult function to staff properly. This is because it requires highly skilled labor, now more than ever, and this is a limiting factor. For that reason, strong and immediate actions have to be taken to alleviate the shortage. More to come in 2019 ! 

 

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