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Temenos Leadership

Chairman's Statement

It is with great pleasure that we present our annual report for 2016 to our shareholders.

2016 was a year during which our clients continued to enjoy positive economic conditions in most parts of the world. The technology upgrade cycle that started in 2015 continued robustly into 2016. The mobile revolution is changing our everyday lives and our clients are adapting their strategies and resulting technology investment to a new world of immediate interaction with their customers.

Clearly this presents our clients with the biggest opportunity for a generation to differentiate and innovate as well as create new business models that will ensure that their customers' trust is put to great use. Digital banking, a term that until now meant different things to different people, is better understood, and the appreciation the impact that this new world will have on banks is far reaching and is becoming mainstream. Digital banking is not only about a modern interface on mobile or internet channels but it is also about exploiting customer data, both transactional and otherwise, and product availability that allows the bank to offer a meaningful and rewarding experience to its customers when they interact digitally with their banks.

Not only are Millennials expecting a constant and immediate interaction with their favourite brands, but the move towards fast payments and cashless societies is causing transaction volumes to grow exponentially. Banks' technology, largely implemented in the 1970s and 1980s is clearly not in a position to cope with this new world. Digital banking is therefore the most disruptive force we had in the world of banking for at least a generation and has the potential to create new global and regional winners.

Cloud computing is also starting to come of age in the world of application software for banks. Regulators have largely embraced the opportunity that the cloud offers to banks to run their operations more efficiently, the security that the major cloud providers offer is better understood and issues around data residence are largely dealt with in most parts of the world even though we expect to see some geographies deal with these issues faster than others. Today it is a reality that a fully functioning new digital bank can be up and running on the cloud in a matter of months with minimal capital investment. We have seen a number of banks pursuing this strategy as a fast route to market. 

During 2016 we focused on growing our organic business, investing relentlessly in our products, global infrastructure and our partner ecosystem which has allowed us to grow our implementation capabilities and ensure successful deployment of our software. The acquisitions we executed in 2015 were fully integrated and contributed significantly to our successful growth. As a result of all of this, we generated record revenues, cash flows and profitability in the history of Temenos and we are therefore also proposing an increased dividend for 2016. Our revenue and profitability growth, arguably the best in the industry, is setting us apart.

We will continue to specialise in the financial services industry with packaged software that becomes better every year because of our strong recurring investment and we will continue to outpace our competitors every year because of this. Key banks are preferring to work with Temenos because they know that selecting a software provider is probably one of the most important decisions they will ever have to make and are increasingly more comfortable to do
so with the industry leader. 

Our robust corporate structure and governance underpin all our efforts and contribute to an environment of trust with our stakeholders that is so critical in growing our relationships. As a global company, we have been operating at an exceptionally high standard of integrity in complying with the laws and regulations of the countries in which we operate – in some cases higher standards than required by national laws or regulations. We have integrated sustainability into our policies and processes, our business planning, measurement and reporting systems, our management practices, decision-making and governance; in other words, into the way we operate. In that way, we have been better prepared to anticipate global business, social and environmental challenges and actively manage the risks and opportunities associated with them. In 2016, in order to make that expectation clear to all our stakeholders, we have launched an internal cross departmental project to explicitly align our Business Code of Conduct and our corporate policies with the ten principles of the United Nations Global Compact, as well as the OECD Guidelines for Multinational Enterprises. In addition, we are committed to measuring our non-financial performance and reporting on it along with our financial performance. This is detailed in the Corporate Social Responsibility section of the annual report.

Influencing the way banking is carried out for the 21st century continues to be our end goal, one that guides our daily endeavours. With more than 3,000 banking clients in 145 countries worldwide, we are well on our way to doing so. With a local investment mind-set, we hope we also successfully contribute to the economies of the world where our clients do business. The success of all who are involved with Temenos, be it clients, shareholders, Partners or employees, will always underpin the positive development of our business.


20 years of innovation

In 2013, Temenos celebrated its 20th birthday; 20 years of leading innovation in banking software