How Treasury Centralisation Creates Value at Bonduelle
by Alexis Wattinne, Director, Finance and Treasury, Bonduelle
Bonduelle is a company with a strong commitment to its staff and customers, integrity and excellence across everything that we do. Treasury has a key role in supporting the company in fulfilling its objectives and enabling our businesses to focus on customer engagement and satisfaction, therefore it should not be considered as a back-office function. Consequently, we have a centralised treasury function that is structured to support the business and deliver value. This article outlines some of the ways in which we have achieved this so far, and some of our current and future plans.
Our treasury department comprises six people, and acts as an in-house bank, conducting all cash and treasury requirements on behalf of the Bonduelle group. In this way, we maintain control over our cash, treasury and risk requirements globally, achieve harmonised financing conditions and ensure adherence with transfer pricing regulations. We use JD Edwards as our ERP across Bonduelle, a common database across the company which ensures a ‘single source of truth’ for information such as supplier settlement instructions. This is integrated with our treasury platform, Sage FRP Treasury. We use SWIFT for bank communication, which is outsourced to a service bureau.
A catalyst for centralised payments
In addition to managing the core cash, treasury and risk management requirements for Bonduelle, we also manage a centralised payments factory within the treasury department. We were already providing payments services, including foreign currency payments, for some entities in the past, but 18 months ago we expanded the payments factory to provide more comprehensive, group-wide services, prompted by the need to migrate to SEPA (Single Euro Payments Area). Consequently, we now have a ‘payments-on-behalf-of’ model, and support 42 out of a total of more than 60 entities across the group, although some of those that are not included in the payments factory are non operational entities. We use a standardised format across all entities, currencies and regions, and combine multiple files into a single payment process, enhancing efficiency and automation. Payments are validated by two signatories from the relevant entity and then passed to the bank via SWIFT using 3SKey. We have five individuals registered for 3SKey tokens at group level: this is where the payments ‘on-behalf-of’ model makes sense; although it’s more difficult to initiate, you add a significant step in security as you limit numbers of people who are able to sign and the number of bank accounts used.
We also worked with our treasury management system provider to enhance the system to enable approvals/ signatures to take place earlier in the payment process and thus ensure smooth global process.
The key added value in this process are:
- Security maintained throughout the whole approval and payment chain. In addition, local entities save time (and money) as Group Treasury is taking care of payments, value date, bank relation, etc…
- Unity of process and system : one single IT package for all entities, meaning reduced maintenance fees, and easier interface processes.
- Standardised format through XML 20022.
- Unity of documentation (Same Score Contracts for all banks).