The risks associated with running a corporate treasury are growing – and Australia’s treasurers need help.
Gone are the days when treasury risk was focused largely on interest rates and foreign exchange. Recruiters say treasuries are now also having to deal with more accounting-driven risks – part of what is termed operational risk – and many just don’t have the skills to do so.
Fuelling this growth in the past two years has been the adoption of International Financial Reporting Standards and stock exchange corporate governance principles, coupled with the introduction of Sarbanes Oxley in the US. Both have led to a greater focus by management on risk management policies and financial disclosure.
Treasurers who responded to the biennial Corporate Treasury Survey released recently by Ernst & Young and the Finance and Treasury Association ranked operational risk management as their second most important function – up from fifth in 2004 – behind cash management. They also said it was tough hiring multi-skilled staff to cope with the growing burden.
Nicola Upham, general manager at Olivier Group, says operational risk has been busy area for the past 18 months. “It’s audit-related and it’s always very difficult to find good audit people,” she says. As well as audit skills, Andrew Wood, a partner at Derwent Executive Search, says compliance and regulatory experience is also prized.
If you do have experience, a career in the area could pay off. Wood says salaries for more junior managers working in a team might start at around AUS$70,000 and could rise to as much as AUS$300,000-$400,000 for “head of” roles at large listed corporations.