The European Association of Corporate Treasurers (EACT), BNP Paribas, PwC and SAP have launched the second edition of ‘Journeys to Treasury’ (JTT), a collection of hands-on conversations about treasury today and tomorrow made with and for treasurers.

The second edition of Journeys to Treasury aims to identify the truly transformative and potentially disruptive changes in the world of treasury. It builds upon a series of surveys, interviews, panel discussions and interactive sessions which took place throughout 2017 to identify the most pressing topics in the world of corporate treasury. The 2017 edition of the report presents pertinent corporate case studies that illustrate how treasurers are addressing these topics.

The three key themes of JTT 2017 are data analytics, compliance & regulation, and cybersecurity. In line with the philosophy of the report, these topics have been developed with the joint perspectives of the bank, the industry association, the consultant and the software vendor.

Everyone seems to agree on all benefits brought by IFRS 9 on hedge accounting. But what are the most important benefits?

1. Possibility to revisit hedging strategies and to hedge more in terms of portfolio and to use cash-flow at risk to identify correlation between risks.

2. It reflects better and more accurately how an entity manages its risks and the extent to which hedging mitigates those risks. The new model provides a better link between an entity’s risk management strategy, the rationale for hedging and the impact of hedging on financial statements.

3. Reduction of P&L volatility as with new provisions more hedges will qualify for hedge accounting and consequently reduce volatility (e.g. ability to hedge the component risk of a non-financial item, removal of [80-125] corridor for effectiveness, ...)

4. More instruments available. The Time Value (TV) of options are not anymore required to be booked into P&L. Now TV will be considered as cost of hedging and be treated as a separate element of equity.

5. All-in it simplifies hedge accounting principles, corrects some of the IAS 39 errors and will be more principles-based.

There's lots of talk of all things green at the moment in the financial world, but it's hard to assess how seriously treasurers are taking it. We have some clear activity in the bond area (Unilever, Anglian Water - well done, Michel Pinto and Jane Pilcher!), but then it's otherwise a bit 'quiet'. I have previously been involved with HRH The Prince of Wales' Accounting for Sustainability (A4S) initiative, and now I am again talking to Jessica Fries, who heads it up, about how the ACT can better support them as well as our members. I was invited to speak at the opening of the City of London's Green Summit (we will also be talking green finance in a future webinar with Sir Roger Gifford who is passionate about the subject, as well as in an upcoming issue of The Treasurer), and very recently have been updated by the ICAEW's Head of Sustainability, Dr Richard Spencer, on the Natural Capital Coalition, which they were instrumental in setting up (and which A4S is also supporting).

Many large organisations are part of the coalition, applying a Natural Capital Protocol and using the various sector guides the coalition has produced. Some of these organisations have realised that if nothing changes, in 5 years' time their business model will be unsustainable. The protocol is a framework designed to generate trusted, credible and actionable information for business managers to inform decisions. It allows organisations to measure, value and integrate natural capital (the stock of renewable and non-renewable natural resources that combine to yield a flow of benefits to people - examples being plants, animals, air, water, soil, minerals) into existing business processes. You can find out more at naturalcapitalcoalition.org.

The experts say green finance is so much more than green bonds, and for those not already convinced, the protocol really helps to understand why. So what does this mean for treasurers?

The ACT's 2017 research, The Business of Treasury, tells us that treasurers are more and more finding a seat at the strategic decision-making table. In the years to come it will be critical for them to ensure they stay abreast of green/sustainable finance developments which will drive much of that strategic decision-making. Organisations who turn a blind eye will find themselves with an unsustainable business model - whereas those who address the problems we know are out there will have time to reinvent themselves as necessary.

I'd love to hear what today's treasurer thinks about this, and what your plans are in terms of your role in environmental and therefore financial and business sustainability. You can contact me on cstockmann@treasurers.org. And the ACT will be working to give guidance and support to its members and the wider global treasury community on this area which is still unfamiliar to many.

Caroline Stockmann
Chief Executive, ACT

• EMIR Refit proposals: impact on Corporate End-Users

• Joint non-financial corporates’ letter on EMIR reporting RTSs

• EACT letter to the European Payments Council on extended remittance information

• EACT Response to the European Commission’s consultation on FinTech: a more competitive and innovative European financial sector

Sustainable Finance
On 13 July, the European Commission High-Level Expert Group on Sustainable Finance published its interim report. It is expected that the final report will be delivered at the end of this year, which will be followed by a Commission comprehensive Action Plan on sustainable finance early next year. The report examines ways to mobilise capital for a sustainable economy as well as changes needed in the processes, incentives and culture of the financial system and of all the actors involved. The report suggests to take a broad view of sustainability that includes environmental, social and governance (ESG) factors, and aims to integrate these factors into the EU’s regulatory and financial policy framework.

The recommendations of the interim report are as follows:

• Develop a classification system for sustainable assets

• Establishing a European standard and label for green bonds and other sustainable assets

• Clarify that fiduciary duty encompasses sustainability

• Strengthen ESG reporting requirements

• Introduce a ‘sustainability test’ for EU financial legislation

• Create ‘Sustainable Infrastructure Europe’ to channel finance into sustainable projects

• Enhance the role of the ESAs in assessing ESG-related risks

• Unlock investments in energy efficiency through relevant accounting rules

• ESAs’ powers to ensure supervisory convergence will be increased

• ESMA to receive transaction data directly from market participant

• ESAs’ procedures to issue guidelines and recommendations will be enhanced. The ESAs will be required to conduct cost- benefit analysis and the relevant stakeholder groups will have the right to seek action by the Commission if they consider that the instruments exceed the ESAs’ competencies.

• Direct supervision by ESMA to will be extended to certain capital market sectors

• Sustainable finance considerations will be integrated into supervision by requiring the ESAs to take into account environmental, social and governance factors arising within the framework of their mandate

• The ESAs’ funding mechanism will be changed so that financial institutions indirectly supervised by the ESAs would have to contribute to the ESAs’ budget, alongside with contributions from the EU budget and the national supervisors

• European Commission public consultation on transparency and fees for cross-border transactions in the EU

• IOSCO consultation on Regulatory Reporting and Public Transparency in the Secondary Corporate Bond Markets

• BIS consultation on fintech

• 14-15 November, Paris, France - The AFTE Days
  It is the key event for corporate treasurers and financial managers. The main topic this year is “10 years of crises, what about now?” The AFTE days will also welcome the Euro Private Placement conference on Tuesday 14 November 2017.
  
  Participants profile: treasurer, group treasurer, back office and cash management manager, finance director, trading room and treasurer director, chief financial and administrative officer, banker, lawyer.
  
  Find more information about topics, speakers and workshops on the AFTE website. Registration on website or e-mail to journeesafte@afte.com.

• 2 November, Rotterdam, The Netherlands - Platform Interim Treasury (PIT)

• 23-24 November, Noordwijk, The Netherlands - Treasury Fair

• 23-25 November, Warsaw, Poland - 19th PCTA Annual Conference
  Join us this November in Warsaw on the PCTA 19th Annual Conference with the topic of “The long-term financing”. PCTA looks forward to EACT Members and NTA treasurers visit at our treasury event in Poland! There will be an opportunity to exchange our ideas and experience on financing subject and to network with the treasures representing companies from different sectors on the Polish market.
  
  All details regarding the accommodation and venue will be available soon.
  
  For more information and details (conference programme, accommodation and venue) please visit our website or contact by e-mail: pcta@pcta.pl. To attend the PCTA event please send us an email pcta@pcta.pl.

• 8 November, London, UK - ACT Treasury Forum
  This invitation-only event is the perfect platform for leading treasury professionals to come together – sharing and debating the key issues of the day in an informal and interactive setting.

• 8 November, London UK - ACT Annual Dinner
  Taking place in the elegant surroundings of the Great Room at the Grosvenor House Hotel, this event provides you with a fantastic opportunity to network with your peers whilst enjoying a superb three course meal, fine wine and entertainment in one of the most prestigious venues in London.

• 21-22 November, Dubai, UAE - Middle East Annual Summit
  Join us at the largest and most popular treasury event in the GCC. Bringing together the region’s leading corporates, you can expect to meet over 500 treasury and finance professionals, hear thought-provoking insights and best practice from over 50 speakers and talk business with over 20 leading product and service providers, all under one roof.

• 20 November, Dubai, UAE - Middle East Annual Dinner
  The dinner is the premier networking event in the corporate finance calendar for the GCC region. The ACT Middle East Treasury Awards will be presented, plus the evening provides the perfect opportunity to network with peers whilst enjoying a wonderful three course meal and fine wines.

• 7 February, Nairobi, Kenya - ACT East Africa Treasury Forum
  Join us for a programme that looks at how treasury professionals can add increased value and deliver results to their business. It’s a great opportunity to get involved, meet like-minded treasury professionals and be part of the debate.

• ACT webinars - View full 2017 programme here
  Led by the ACT’s policy and technical experts, ACT webinars give direction on regulatory change and key treasury concerns direct to your desk, wherever you are in the world.

To attend an ACT event or webinar, book online at treasurers.org/events or for more information email events@treasurers.org or call +44 (0)20 7847 2589.

• AFTE training programme is available here

• 11-12 October, London - Mechanics of corporate funding

• 13-17 November, London - A-Z of corporate treasury

To view more ACT training courses or to book online, visit academy.treasurers.org/training or for more information contact Kelly Robertson at krobertson@treasurers.org or tel +44 (0)20 7847 2573.

Members of National Treasury Associations benefit from special rates on ACT-led training courses.