Building a framework sets the stage for green bonds—an umbrella to systematize initiatives. Increased scrutiny of corporate sustainability efforts by investors and other stakeholders has made it essential for companies to place ESG initiatives into a clear framework. Building the framework to coordinate decisions and address investor inquiries more effectively requires communication among key parts of the company, with treasury playing a critical role.These were among the takeaways from a recent meeting of NeuGroup for Capital Markets sponsored by Wells Fargo…
Editor’s note: The NeuGroup Process brings members together to solve problems and answer each other’s questions in a variety of forums, including online communities for specific groups—one of many benefits of membership. Talking Shop shares valuable insights from these members-only exchanges, anonymously. We welcome your responses—and any questions you want answered: [email protected]. Member question: “Does your company have a finance/accounting shared service center? “If yes, do you have a SOX entity-level control (ELC) related to monitoring the shared services center activities, e.g., error rates,…
Wells Fargo’s risk-adjusted liquidity ratio offers insights on how corporates view liquidity during recessions.Setting a target for a company’s ideal liquidity level is never easy. Corporates use a variety of metrics and liquidity ratios to get it right. But what happens when events like the global financial crisis or the pandemic push the economy into recession and force corporates to go into crisis mode? In theory, given that most companies revenues and expenses drop somewhat during a recession, they should…
The huge hype surrounding the Coinbase IPO this week is just another sign that finance teams trying to stay ahead of the curve can only benefit by boning up on Bitcoin and the rapidly moving world of cryptocurrency. NeuGroup is committed to helping members learn from those in the know. This week—before the IPO—Allison Rossi, treasury lead at the digital payments company Square, explained the decision-making process and logistics involved in the company’s $220 million investment in bitcoin, made in…
An FX risk manager faces hedging and forecasting challenges amid changes made in response to BEPS regulations. It’s no surprise that the 15-point action plan announced by the OECD in 2015 to address base erosion and profit shifting (BEPS) would create various headaches for finance teams at multinational corporations. But a member presentation at a recent meeting of NeuGroup FX risk managers provided a fuller picture of some specific challenges facing companies as they comply with the new regulations.At issue for…
Critics say traditional tools are inadequate for illustrating risk; one ERM member has found success modernizing them.Pity the poor risk heat map. This well-worn tool, traditionally used by ERM teams to provide a visual representation of the range of risks a corporate faces, is now an object of scorn for some risk managers, including NeuGroup members. “Heat maps must die,” one member said at a recent NeuGroup meeting for ERM heads, a sentiment echoed by a number of his peers.Also…
Members of NeuGroup for Capital Markets praise Fitch analysts and a ‘ratings-through-the-cycle’ approach.For decades, Fitch Ratings has been the third ratings agency—behind Moody’s and Standard & Poor’s—used by Fortune 500 corporates that want to ensure they maintain the two investment-grade ratings necessary to remain in the Bloomberg Barclays Bond Index. That may be changing. At a recent meeting of NeuGroup for Capital Markets, members said they have been impressed with Fitch’s analysis over the past few years, and especially…
ERM is reaching new heights as risk exposures multiply and rising insurance premiums drive a search for options. Enterprise risk management is having a moment amid a seeming explosion of risk exposures facing corporates since the pandemic began. And as the function grows in importance, at least a few ERM teams are heading toward inclusion in corporate strategy groups—a trend definitely worth watching. One member at a late March meeting of NeuGroup’s Corporate ERM group said his goal since recently…
With 2021’s first-half meeting cycle underway, a message from NeuGroup founder and CEO Joseph Neu. As we pass the one-year mark of pandemic disruption in most parts of the NeuGroup member universe, we are upping the ante further on our program of opportunities for you to share and learn with other members. In this cycle, we are rolling out a new events calendar on our website. It is meant to keep you abreast of all the new programming available at NeuGroup to help you navigate the unprecedented change of our times. It also serves as a program guide for prospective…
Mega-cap treasurers and PwC discuss multiple benefits of IHBs and some complexities of structuring them. Treasurers not sold on the value of in-house banks (IHBs) often tell Damien McMahon, a partner at PwC, “We have cash pooling already, and therefore we have a kind of in-house bank,” he recently told a group of NeuGroup members from mega-cap companies. In reality, though, many of the treasurers may have what Mr. McMahon called “cash puddles,” not cash pools. PwC and treasurers from two…