Building a greenfield treasury

April 2013

In this Q&A, Marjut Artimo, Treasury Manager at Lumene group, a Finnish skincare and colour cosmetics company, outlines a number of important considerations when building a treasury from the ground up.

Treasury Manager Marjut Artimo joined Lumene group, a Finnish skincare and colour cosmetics company utilising the effective ingredients of Arctic nature, in March 2005 to set up the company’s treasury department from scratch.

Her responsibilities among other things include:

• Financial risk management.
  
• Liquidity and cash management, forecasts and reporting.
  
• Treasury reporting and budgeting.
  
• External and internal funding operations; managing group loan portfolio and financial covenant calculations.
  
• Cash management, including payment procedures and bank account structure.
  
• Credit risk management.
  
• Subsidiary control and aid on treasury matters.
  

In this Q&A, she gives a few words of advice to those starting out on the journey.

Treasury Today (TT): When brought in to build a treasury, what are the important questions that treasurers need to ask before they begin?

Marjut Artimo, Treasury Manager, Lumene group (MA): I think that first off you need to understand the present situation, core processes and financial risks of the company. It is important to identify the most crucial treasury issues and risks for that particular company, and address them first. That will then help you to determine the scale of the treasury function.

TT: What are the main challenges and pitfalls to such a project?

MA: The biggest challenge is a lack of resources, whereas the pitfalls include trying to do too many things and changes at the same time. Many treasurers may also face a lack of support from top management.

TT: Is it possible to leap-frog to best practice? If so, how should a treasurer go about doing this?

MA: Yes, I think that it is possible to leap-frog to best practice. But this is dependent on whether you have a well-organised project, get support from top management, have access to the best available technology and provided with enough resources (both people and money).

TT: Should they look to bring in external help or outsource areas of treasury?

MA: This was an active discussion in Finland a few years ago, but not any longer. I think that you can use external help when planning, organising and implementing a greenfield treasury project, but at the moment I do not see many opportunities for outsourcing the actual treasury work.

TT: Do you think this is a career-making opportunity for corporate treasurers?

MA: This might be career-making opportunity and I for one could consider doing it all over again. However, I think that starting a greenfield treasury does not suit everyone. You need to be very hands on, an operative type and enjoy new challenges and project work. You should also be able to tolerate imperfection and be able to make decisions with limited information, since you cannot expect everything to be ready and running smoothly in one day.

This insight was first published on www.treasurytoday.com