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Treasury risk management transformed

Andrew Hollins
Andrew Hollins
Director of Corporate Treasury Proposition, Refinitiv

A treasury risk management case study highlights how a major transport company banished manual and inefficient practices using a fully-integrated, real-time data solution from Refinitiv to manage its fuel price hedging strategies and counterparty risk.

  1. Our treasury risk management case study focuses on how to tackle the tedious, inefficient manual processes that cause time delays and ultimately increase risk exposure.
  2. Refinitiv designed a tailor-made solution that led to better FX pricing, enhanced counterparty risk management and improved hedging decision-making.
  3. The bespoke solution leverages Refinitiv Eikon’s open platform technology to deliver trusted, relevant data with holistic visibility across the risk landscape.

Many corporate treasury teams are still grappling with slow and reactive responses to risk that leave them vulnerable in a world that demands agile, proactive treasury risk management.

In a recent real-world situation, Refinitiv helped the corporate treasury team of a major transport company to move from a manual and inefficient approach to risk management to an automated and optimized solution.

Refinitiv’s Eikon provided the foundation for this transformation by harnessing the power of open platform technology to deliver trusted, relevant data that enables holistic visibility across the risk landscape.


Treasury risk management challenges

The recent case study highlights the inherent risk management challenges that a corporate treasury department experiences on a daily basis.

The client partnered with Refinitiv, and we delivered a bespoke, award-winning solution supported by fully integrated real-time data and advanced functionality.

The net results speak for themselves: The client now benefits from a proactive, streamlined risk management solution that in turn enables better corporate treasury decisions and boosts operational efficiency.


Fuel price exposure

The client in question — a major UK-based transport company — needed to update a host of tedious, inefficient manual processes that were causing time delays and ultimately increasing risk exposure.

Given the industry in which it operates, the client’s core needs were to proactively manage fuel price exposure and related fuel hedging strategies, whilst simultaneously monitoring counterparty risk across more than 16 banks.

In-depth consultations between the client’s corporate treasury team and Refinitiv revealed that the ideal solution needed to be dynamic, easy-to use, and highly accurate with automation a top priority.

Andrew Hollins quote

A tailored solution with real benefits

Refinitiv devised a tailor-made solution which:

  • Delivers real-time information for better management of fuel price volatility.
  • Allows changing hedge prices to be evaluated quickly: Changes in both the end currency and unit of purchase (for example, GBP pence/liter) are included.
  • Offers insights into the underlying drivers of price movements.
  • Enables counterparty risk to be monitored on a continuous basis so as to avoid a credit event due to the failure or significant downgrade of any financial counterparty.
  • Generates implied credit ratings for specific counterparties where no formal credit rating is available.

This bespoke solution leverages Refinitiv’s Eikon.

Built on open platform technology, Eikon delivers trusted news, data and analytics that can be filtered to exact requirements, and connects users to markets and professional networks.

The benefits of this new system were immediate and significant.

The company moved from an outdated and highly manual system to a proactive risk management solution, which resulted in vastly improved financial risk management, better FX pricing, enhanced counterparty risk management, and improved hedging decision-making.

Reliable and complete data

Trusted, complete and relevant data is the true star of this story, because such data enables holistic visibility across the risk landscape, better data analysis, and ultimately enhanced decision-making.

When reliable, fully integrated real-time data and information are combined with advanced functionality, agile responses become possible, as in this case in point.

The client in question transformed a manual, tick-box approach to risk management into a fast, efficient automated solution, driven by targeted, reliable and complete data.

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