Cultural perspectives GLOBAL TREASURY: MANAGING CROSS CULTURAL CHALLENGES You might want to implement the same treasury structures globally but the way and extent to which some countries resist can take you by surprise. In a series of interviews, leading multinationals reveal how treasury policies are understood and implemented depending on the cultures. What are the most effective ways of overcoming resistance? By Mariel Barclay. While treasurers make efforts to gain Nicolas Levet’s first task as Group Treas- they were rapid to comply. Latin Ameri- efficiency and improve processes all over urer at Damart Somfy Group was to cans tried to negotiate but faced with the the world, they can easily forget that cul- ensure that subsidiaries implemented corporate’s refusal to compromise, they tural differences and not just tax and policies established three years prior to had to agree. However, close follow up regulatory restrictions, will impact the his arrival, which until then had been and controls were necessary to ensure full way people perform and prioritise activi- ignored. The corporate had over 100 compliance. China was prompt in agree- ties. Indeed, cultural misunderstandings bank accounts and required the closure ing but when auditors went to check, the are often at the heart of the delays and of local ones, sticking to a few core inter- local accounts were still in place.” frustrations in implementing projects. national banks. Most subsidiaries had argued that local banks were better but So what is an effective way to com- But what do we mean by culture? One when Nicolas Levet approached them municate with different cultures? “To way of understanding it, is as a set of with a clear mandate from the corporate manage cultural differences you have to shared values, beliefs, symbols and to enforce the policy, cultural differences start by understanding your own norms that influence the way a group of became apparent in the way each coun- culture in a non-judgemental way and people think, feel and behave. These are try reacted. “Although all resisted ini- link it to the operation at hand” says deeply engrained. To complicate things tially, when the Nordic subsidiaries Alex Schuster, Managing Director at further, cultures are not just national but understood that there was no going back consulting firm Mentavis. also regional, corporate and personal. Companies cannot change them, only carefully tailor communication to help What the British say... What the British mean... What is understood... build bridges. The EMEA regional treasurer of a $20 With the greatest respect... I think you are an idiot. They’re listening to me! billion company that prefers to remain That’s not bad. That’s good. That’s poor. anonymous notes: “In Germany people listen and act. In the Middle East they That is a very brave proposal. You are insane! They think I have courage! have a view on how things should be done and I have to listen to them. Although in the end we do what the cor- Very interesting. This is clearly nonsense! They are impressed! porate dictates, I have to adopt different communication styles.” I’ll bear it in mind. I’ve forgotten it already. They will probably do it. Communication is often put to the test by Why do they think cultural resistance when companies I’m sure it’s my fault. It’s totally your fault. it’s their fault? decide to centralise and standardise pro- cesses globally. “If you think that you are I almost agree. I don’t agree at all. They almost agree. going to centralise and everybody is going to fall into line, you are being unrealistic. You must come for Don’t get excited, I am sure I’ll get an A good communication and change man- dinner. I’m just being polite. invitation soon! agement process is fundamental” says Alfredo Elespuru, Corporate Treasurer at Gloria who helped centralise treasury at Belcorp and Oriflame. Subsidiaries typically resist as they see their wallet and their autonomy being taken away. However, reaction and time taken to comply with corporate requirements varies with every culture. Understanding how to build trust and to communicate with each is fundamental to succeed. www.eurofinance.com TREASURY PERSPECTIVES 2017/2018 // 41