2025- scenario planning and forecasting gets real
2024 has been the year with arguably the most consequential global election cycle the world has witnessed.
The bright spot in all of this has been that in most parts, the majority of institutions and systems have largely survived but few will venture what the next few years will unveil. For most leaders, a number of unknowns will prevail and some of the main variables in any planning will be impacts on trade, inflation, interest rates, survival of institutions, conflicts to name a few. This will clearly bring risk management and capital preservation to the front and center of any planning, and cash will take on a new level of importance.
In our view, the following have become increasingly important:
Counterparty risk -[No one can foresee how a range of issues can impact banks and other institutions, (whether political, technology, global events such as covid) and the importance of diversification is now an essential part of responsible business risk management]
Inflation and rates - [How much volatility will impact on inflation and rates, and the need to have a balance of cash allocations across rates and banks makes much more sense]
Governance and Compliance -[Compliance will increasingly be incorporated into organizations as shareholders such as Fund managers, pension funds meet their internal requirements. This means organizations that have stakeholders must embrace them, and adopt Pro-Active Compliance, of which "best interest" will only be one of these.
We have also written a few excerpts around some emerging trends coming through in cash management and optimization, and we encourage you to read these short-form notes available on our website "Resources". Some of the topics include:
Cash Cycle and Optimization-Reimagined
How does best interest apply to finance and treasury teams
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