Turkish corporates move from tactics to strategy
The country’s investment banks are encouraging firms to take a longer-term view of risk management and funding. Change is happening, but from the top down. Nick Kochan reports.
TURKISH CORPORATES HAVE a long history of fighting financial fires. As a result of numerous financial crises, strategies are based on short-term thinking and low-cost economic management. But changing economic fundamentals are offering new opportunities to plan for the longer term and be more visionary.
The issue for banks is whether corporate managers who have learnt their skills in the school of hard knocks can change their approach. Attila Koksal, deputy chief executive of investment bank Standard Unlu, sees some prospects of this. "There are not many long-term thinkers," he says. "We lost that ability. We have always been focused on the short term. Our long term was one month to three months. Nobody can really do two-year or three- or five- or 10-year plans. Tactically our corporate managers are very strong – strategically they are not. This may be changing."
Turkey is experiencing a cultural shift, as global economic conditions change corporate behaviour. A process of education has begun, says Botan Berker, general manager for Fitch Ratings in Istanbul. "The corporate sector has woken up to the need to hedge their exposures. They used to think it was a waste of money because they had to pay fees and commissions for a hedging product.