Treasury on the Move
IOM (International Organization for Migration) is the world’s leading organization providing services and assistance concerning migration. Established in 1951, IOM promotes international cooperation on migration issues to assist in the search for practical solutions and provide humanitarian assistance to migrants in need. With both emigration and immigration on the rise, the organization has been growing steadily. It now runs projects in over 165 member states and has 401 IOM offices (so-called missions) and over 9,000 employees worldwide. This makes IOM a highly complex organization – a complexity that is mirrored in their treasury operations.
Chief of Treasury, IOM
The treasury function of a globally active humanitarian aid organization is very different from a traditional corporate treasury. Some of the main concerns for IOM’s treasury are how to efficiently get money to crisis regions, how to economically process payments there, and how to hedge their broad currency portfolio. Exact planning is very difficult, making this a real challenge, as the money needs to quickly get to where it is needed. IOM works with more than 100 currencies in around 2,500 to 3,000 projects. For the treasury team, this means establishing efficient cash and risk management processes to cope with FX, country, counterparty, operative and internal risks.
IOM meets these challenges with efficient cooperation and the balancing of centralized and decentralized responsibilities. It is of vital importance to involve the missions as they have local know-how and the means of quickly converting currencies in the respective countries. This close cooperation also eases the central treasury department’s workload. To aid their efforts, IOM introduced an organization-wide treasury management system, which allowed the treasury team to establish a comprehensive cash management and standardized, bank-independent payments setup. IOM also got connected to the SWIFT Network, which enables them to automatically process account statements. A large proportion of payments have been centralized, leading to significant cost savings. The treasury team can now ensure demand-led and target-oriented funding – so IOM can provide help wherever it is needed.
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