As we reflect on the treasury’s journey over the last three years, our new research reveals an urgent need for change. Nordea last reported on treasury KPIs in 2016. Back then, over three-quarters of respondents had established treasury KPIs and the majority said that KPIs had improved treasury effectiveness. The research discovered a gap between the treasury’s objectives and those of the business. Many treasuries weren’t actively measuring stakeholder satisfaction with their performance. A significant proportion said that KPI outcomes never affected treasury staff compensation. Nordea’s 2019 Treasury KPI report reveals that treasuries are embracing KPIs, and the business is paying attention to the outcomes. But just like in 2016, treasuries are not using KPIs to evaluate their own performance or for benchmarking towards peers despite the accelerating pace of digitalisation. Many Treasuries also have a short-term focus. Increasingly lean and streamlined, they are often focused on mission-critical priorities like liquidity and funding. Operational KPIs and corporate social responsibility (CSR) are falling down the agenda and hardly any treasuries have implemented KPIs related to their digitalisation goals. If they can balance their immediate priorities with these more longterm goals, treasuries will be more prepared for the future. Treasuries are embracing KPIs. 77% of treasuries have established KPIs. 46% of those use specific KPIs to track treasury performance, up from 27% in 2016. 90% of treasuries say their KPIs are at least partially linked to the company’s goals but only 15% say their KPIs are “directly derived” from the company’s strategic goals, a slight decrease from 2016. Given the treasury’s ambition to become a more strategic player, this figure would be expected to rise rather than fall. The treasury does have the attention of business leaders. The board is the most likely to set the treasury’s KPIs (32%), followed by the CFO (28%) and the treasury itself (19%). The business recognises the importance of what the treasury does — but that doesn’t mean it sees it as a strategic function; it understands the importance of risk management to the bottom line. 77% of treasuries have established KPIs to measure treasury performance 90% have KPIs that are at least partially linked to the company’s srategic goals 2 / TREASURY KPIs 2019 EXECUTIVE SUMMARY
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