Digitally enhanced shot of a colleagues working in their office


New macro-economic risks have emerged at the start of 2020 – creating a familiar sense of unease among finance practitioners. Treasurers are also under increasing pressure to transform their functions in search of new operational efficiencies, as maturing technologies and evolving business models take shape. J.P. Morgan has identified the key trends that will impact corporates and the areas of focus for treasurers for the rest of the year.

Macroeconomic Uncertainty

Contagion from ongoing global headwinds

While uncertainties surrounding Brexit and the U.S.-China relations have eased, the outbreak of the new coronavirus have presented new risks for the global economy, that has already borne the brunt of the trade tensions in recent years. Year on year growth in global capex growth has declined by 8% since 2018 due to falling business confidence,1 while shifts in supply chains have also been noticeable, with US imports from Vietnam and Taiwan rising at the expense of China.2 

We expect the contagion effects from geopolitical events to prevail throughout this year.

Macroeconomic policies will support global growth

Against an uncertain backdrop, there has – since 2018 – been a synchronized global slowdown across leading economies. The good news is that accommodative monetary policies will help support financial markets throughout 2020.

China’s central bank in February lowered its interest rates on reverse repurchase agreements and injected over a trillion yuan into money markets, while required reserved ratio for banks have dropped to a decade low – to relieve pressure on the domestic economy. The U.S. Federal Reserve in March also delivered an emergency rate cut – the first since the global financial crisis – to counter risks to the economy as a result of the coronavirus outbreak, with other central banks around the world expected to follow suit. Such accommodative monetary policies, together with supportive fiscal measures by major economies, are expected to help prop up growth.

Priorities for treasurers

With macroeconomic uncertainty likely to persist, treasury practitioners should consider increasing their focus on capital optimization in order to unlock internal sources of cash to fund supply chain disruptions and better capitalize on M&A opportunities during periods of uncertainty. According to a research by BCG, shareholder returns on M&A deals executed during an economic downturn have been found to significantly outperform those transacted in a booming economy 4.

A Digitized Treasury

Digital-driven business models gaining traction

With 90 percent of the world’s population now accessible to the internet5, and tech-savvy Gen-Z and millennials accounting for more than half of global population6, customer expectations are changing. The proliferation of real-time payments and the shift towards a digital, cashless society have led to the explosive growth in mobile commerce that demands new, digital business models.

Cloud computing has provided ample opportunities for traditional businesses such as logistics, mobility and infrastructure to sell their solutions ‘as-a-service’, while others have adopted pay-as-you-go and subscription models as consumers increasingly seek convenience and cost-effective services. With growing demand for more intuitive, real-time and integrated solutions, we expect to see companies that have built digital business ecosystems (e.g. Amazon, Facebook, Uber) expanding from their core businesses and diversifying into other industries.

Treasury technologies no longer just buzz words

Technology deployment is finally gaining traction within the treasury space, as finance practitioners harness emerging technologies and data to support new digital-driven business models. About 44 percent of treasury functions are currently pursuing big data and artificial intelligence7, and the adoption is even higher among operations-focused shared service centers with 82 percent having or in the process of setting up a data analytics function8.

Priorities for treasurers

With new direct-to-consumer business models and instant payment rails gradually being rolled out globally, treasurers should sit with their banking partners to map out their objectives, and by deploying technology in-house or tapping into digitized banking solutions, work towards building a real-time treasury.

While technology provides tremendous opportunities, it’s also important to keep in mind the heightened risk of fraud and cyberattacks. A 2019 study by PwC revealed that only 15 percent of companies surveyed were not affected by attempts on payment fraud9. With cyberattacks becoming more sophisticated, treasury departments – being the nexus where money flows in and out of an organization – need to be increasingly vigilant and focus on strengthening its defenses against fraud.

Environmental Factors

Rise of ESG

Environmental, social and governance (ESG) reporting – which tracks the sustainability and ethical impacts of a company – has garnered increasing attention from global investors in recent years. The global sustainability investment market has grown by 34 percent from 201610, increasing exponentially across all regions, while 49 stock exchanges worldwide have committed to publishing ESG disclosure guidelines11. At the same time, EU policymakers have also agreed on a regulatory framework around ESG that demands more corporate transparency, and we expect this to gain traction in other regions12.

The growing demand for ESG reporting is expected to directly impact the remit of corporate treasurers, as investors no longer focus solely on an organization’s financial performance, but also on the societal impacts of their business practices.

Priorities for treasurers

Companies today are under increasing pressure to deliver business growth, whilst positively contributing to social and environmental change. With 75 percent of companies now directing corporate responsibility from the C-Suite leve13, corporate treasurers can become more involved in ESG through the areas of sustainable financing, investment and supply chain practices – to align themselves closer to the firm’s strategic agenda.

Treasurers can consider raising finance through sustainability-linked loans or issuance of green bonds, while also incorporating ESG into investment policies and spends that focus on responsible activities. Companies also need to assess their end-to-end supply chain and consider evaluating their counterparties (banking partners, vendors) based on their ESG credentials.


1.J.P. Morgan Capex Nowcaster – Global – Index (CapexNow), December 2019
2.U.S. Census Bureau, FactSet: U.S. imports by country (Jan-Oct 2019 vs Jan-Oct 2018), January 2020.
3.J.P. Morgan, Global Data Watch, January 2020
4. BCG: The 2019 M&A Report, September 2019
8. 2018-2019 APAC SSON Survey, September 2019

For more information, please contact your J.P. Morgan representative.

This material was prepared exclusively for the benefit and internal use of the JPMorgan client to whom it is directly addressed (including such client’s subsidiaries, the “Company”) in order to assist the Company in evaluating a possible transaction(s) and does not carry any right of disclosure to any other party. This material is for discussion purposes only and is incomplete without reference to the other briefings provided by JPMorgan. Neither this material nor any of its contents may be disclosed or used for any other purpose without the prior written consent of JPMorgan.

J.P. Morgan, JPMorgan, JPMorgan Chase and Chase are marketing names for certain businesses of JPMorgan Chase & Co. and its subsidiaries worldwide (collectively, “JPMC”). Products or services may be marketed and/or provided by commercial banks such as JPMorgan Chase Bank, N.A., securities or other non-banking affiliates or other JPMC entities. JPMC contact persons may be employees or officers of any of the foregoing entities and the terms “J.P. Morgan”, “JPMorgan”, “JPMorgan Chase” and “Chase” if and as used herein include as applicable all such employees or officers and/or entities irrespective of marketing name(s) used. Nothing in this material is a solicitation by JPMC of any product or service which would be unlawful under applicable laws or regulations.

Investments or strategies discussed herein may not be suitable for all investors. Neither JPMorgan nor any of its directors, officers, employees or agents shall incur in any responsibility or liability whatsoever to the Company or any other party with respect to the contents of any matters referred herein, or discussed as a result of, this material. This material is not intended to provide, and should not be relied on for, accounting, legal or tax advice or investment recommendations. Please consult your own tax, legal, accounting or investment advisor concerning such matters.

Not all products and services are available in all geographic areas. Eligibility for particular products and services is subject to final determination by JPMC and or its affiliates/subsidiaries. This material does not constitute a commitment by any JPMC entity to extend or arrange credit or to provide any other products or services and JPMorgan reserves the right to withdraw at any time. All services are subject to applicable laws, regulations, and applicable approvals and notifications. The Company should examine the specific restrictions and limitations under the laws of its own jurisdiction that may be applicable to the Company due to its nature or to the products and services referred herein.

Notwithstanding anything to the contrary, the statements in this material are not intended to be legally binding. Any products, services, terms or other matters described herein (other than in respect of confidentiality) are subject to the terms of separate legally binding documentation and/or are subject to change without notice.

JPMorgan Chase Bank, N.A. Member FDIC. JPMorgan Chase Bank, N.A., organized under the laws of U.S.A. with limited liability.

Ombudsman J.P. Morgan: Tel: 0800 – 7700847 / E-mail: