00;00;02;03 - 00;00;29;03
Unknown
Should Treasury stick to a transactional approach to their role or should they broaden their horizons and act as strategic advisors to other parts of the organisation? Welcome to Currency Cast. My name is Agustin Mackinlay, I'm the Senior Financial Writer at Kantox and your host. In this episode, we have the pleasure to welcome Pieter de Kiewit, a well-known Treasury headhunter and entrepreneur.
00;00;29;05 - 00;00;57;21
Unknown
Pieter, a very warm welcome to you and thank you for joining us in this episode of CurrencyCast. Thank you for having me. Love to be on this side of the table because sometimes I am a guest, like a session of yours, but also I'm very often in your role moderating sessions at TreasuryXL or elsewhere. So it's very interesting to be on the other side of the table here.
00;00;57;23 - 00;01;27;17
Unknown
That's right. Look, Pieter, can you start by introducing yourself to the audience? Of course. Happy to do so. So my original job and also my current passion is to be a recruiter. I love making the match between a company and a new employee. It could be interim, it could be permanent. Already over 30 years ago I stepped into this job type and after about five years, I worked on my first Corporate Treasury assignment.
00;01;27;20 - 00;01;53;11
Unknown
KLM at the time, and the rest is history. Currently, I'm in my company Treasurer Search. We are 13 currently and recruiting people in Corporate Treasury roles around the world, but mainly in the Benelux and in Germany. All right. Now let's start our discussion, we will start out with maybe some general topics and we can go down to more specific questions.
00;01;53;14 - 00;02;23;03
Unknown
In a recent piece on the Travel industry, in Treasury operations in the Travel industry, Pieter, we read that the treasurer should move beyond the boundaries of the Finance department to act as more of strategic advisors to the CFO, to the CEO, to other parts of the organisation. I’d like to hear your views on that, very generally first and then with more details.
00;02;23;06 - 00;02;51;19
Unknown
Yeah. Well, I do see what you mention there that the world is changing, org charts are changing, tasks are changing. And this leads to a situation where people have to step up. And that's partly based upon Treasury expertise. So it makes of course sense if you talk about the Travel industry and it's about payments and payment flows that the treasurer takes initiative.
00;02;51;22 - 00;03;22;01
Unknown
But there's a lot of other tasks that are not so well defined or that new that they are not put logically in any boxes. So I think it's a mixture of the skill set people have on the one hand, but also their personality. If they like to branch out, if they like to connect to other functionalities and all related and step into a new economy or other words that are used for this changing world.
00;03;22;04 - 00;03;46;11
Unknown
Right. And I was about to ask you exactly that. Is that confined to specific industries or for example, maybe payments playing a more important role, or do you see it as a maybe a broader trend here? Well, it's a bit of a yes and no question. Of course, you mentioned the Travel industry and Expedia, I saw the article.
00;03;46;14 - 00;04;17;20
Unknown
Of course, the impact is huge there, and there it's kind of unavoidable. But if you look at more traditional industries also there, the changes are quite prominent. And so I think it's for all industries, but for some more than others, and also for all function types in Treasury. Cash management as well as risk management, FX risk management as well as funding, are all changing a lot.
00;04;17;23 - 00;05;08;19
Unknown
So yeah, be it in e-commerce, be it in large energy projects or internationalisation, globalisation of other industries. I think the change is dominant and prominent everywhere. Alright. Pieter, in a recent TreasuryXL webinar, you made the point that in some projects treasurers fail to gain traction across the organisation. And that's interesting because you said that this may be due to their lingo, their jargon in terms of, I don't know, like things like working capital management, discounted cash flow valuation, sales to assets ratio, and all that.
00;05;08;21 - 00;05;34;02
Unknown
Can you elaborate on this point, the jargon, the lingo in your words? Yeah. What I see a lot is that the, and that's not for every treasurer, but a lot of treasurers are quite fond of their position, and that's of course good if you love your job. But that kind of results in staying in their own box.
00;05;34;05 - 00;06;05;15
Unknown
And we touch upon something that is researched quite thoroughly by psychologists, but not really a topic where in our part of the economy's talked a lot about. Because you talk about what enthuses you, what drives you, and what you see in the Treasury population is that a lot of people working there are driven by their job content. And not so much, for instance, the impact they can have on their organisation as a whole.
00;06;05;17 - 00;06;34;27
Unknown
So going into this funnel of Treasury, comes with talking a lot of the job and going deeper and deeper and deeper. And something that connects to the previous question is if you want to have more impact, perhaps deeper is not always better, but a broader audience also makes sense. And then it's about, okay, are you driven as a person by having more impact and willing to connect to the rest of the world?
00;06;34;29 - 00;07;00;14
Unknown
And are you willing to pick up the skills that are necessary to connect to a CFO, to a sales guy, to a marketing person, to procurement? And that is not what you see a lot in the Treasury community. And it's observed, and everybody sees it. But change hasn't, let's say, set in, to put it like that. Right.
00;07;00;20 - 00;07;28;27
Unknown
Well, that's really interesting that you mention, say, psychology when it comes to the role of the treasurer. A few days ago we had the sad news of Daniel Kahneman passing away, a pioneer in the field of psychology and economics. So one of the biases that he mentioned is precisely this one, the insider bias. Right.
00;07;28;29 - 00;07;59;19
Unknown
I think that's one of the points here you're mentioning. So it's nice to have this connection and this view of, well, perhaps why not exploring more the role of psychology. Pieter, say that you're looking for a Treasury position, a treasurer. Constantly, haha. That's right. Say that it's based in Dubai and the person would need
00;07;59;21 - 00;08;32;22
Unknown
debt capital markets experience in Europe. That person should understand all the things that the tax, the legal, all of the other issues related to that it should have experience with the world of investment banking. That's very demanding, isn't it? Totally. Yeah. Yeah. No, it's very demanding. And that's also why it's not easy to find someone. And that's a good thing, because otherwise my client wouldn't need me to find the right person.
00;08;32;25 - 00;09;07;17
Unknown
So, yeah, it's a demanding position. Indeed. In one of your searches also, I see that you're looking for it, and I quote you here, a communicative corporate treasurer. So that begs at least two questions. Pieter define what is a communicative corporate treasurer for us. Yeah, well, nice question and also nice to connect me to my own text or that of my team.
00;09;07;20 - 00;09;38;04
Unknown
In this case the communication part is being able to connect to the rest of the business. And the communication part is not necessarily the broadcasting part, which is part of the whole communication, but also the listening part. Listening to what keeps your colleague awake at night. And that would be like the superficial approach.
00;09;38;07 - 00;10;24;19
Unknown
It's kind of a skills approach, like learning a trick. Okay, learn how to listen and learn how to phrase the message that it's understood. Very relevant and also interesting for people in their careers or hiring people to see if you can also go to the under ying message or the level a bit deeper. So to say if you are driven still like a lot of treasurers by solving the puzzles, looking for the complexity and then finding the solution to this equation. Then listening and sending is a trick.
00;10;24;21 - 00;10;57;18
Unknown
And if you are driven by widening the audience for your Treasury task, then perhaps you touch upon personality elements that are more relevant for a communicative treasurer, who is much more of a business treasurer than, for instance, a risk mitigation expert. So it's very interesting for us as a recruiter to find out why do your clients are looking for a candidate who has communication skills?
00;10;57;20 - 00;11;39;01
Unknown
And there I can talk for hours, so to say. Yes, let's talk. Would you define those as well to use a very common term soft skills as opposed to others say, hard skills, like you mentioned cash management or risk management or raising capital. So do the soft skills like, well, talking and listening. Well, I'm not a big fan of this phrase soft skills because it implies that it's not measurable, that it's not a real skill.
00;11;39;01 - 00;12;05;17
Unknown
You've got your real skills like cash management, you've got your soft skills which are kind of lower level, not that important. Right? That implies hierarchy, right? Yeah, exactly. Well, you find it's a bit artificial. Is that right? Well, I'm not sure if artificial is the word, but it's a bit like you've got hard science, like physics and mathematics, and then you've got soft science, like psychology, which is kind of an amateur science.
00;12;05;19 - 00;12;37;08
Unknown
But I think that the setting defines what's most important. And so in some cases, indeed the hard core mathematical skills are dominant, but in many cases the technical skills are not the dominant because you will see that any treasurer is 5 times as smart as his colleagues when it comes to strategy. But the real impact is much more on including your colleagues in the road to success, including Treasury.
00;12;37;10 - 00;13;15;03
Unknown
So I think it touches upon, if you think a person is essential for the success of your Treasury organisation. Which of course hey, given my job, I think it is. Okay, how can you predict if you want a new person in your team, if this person brings to the it’s called soft/hard/other skills that will bring you the success you're looking for. And it forces people into a situation that they have to think about how, what does this person do over here?
00;13;15;05 - 00;13;59;07
Unknown
Can I predict if he or she can do this task successfully? And what can I measure right now in this meeting, in a CV and in an online assessment, wherever that will predict success in the task at hand. And I'm a bit split here. Because on the one hand, you see that in many cases amateur hour people win job interviews when they interview candidates, they trust their gut. Statements like I know already in the first one or 2 minutes if I will hire somebody or not, that is really not what I love to hear.
00;13;59;09 - 00;14;28;15
Unknown
On the other hand, if everybody would pay attention to recruitment and find the right person with the right methodology, perhaps there wouldn't be as many assignments from me. So, yeah, I think that the people, staff, and jobs deserve more attention. Not because it's philanthropy, but because your organisation will be better for it and more successful. Right, right.
00;14;28;17 - 00;14;58;14
Unknown
Okay. Now let's discuss maybe other types of skills we were discussing with Pieter de Kiewit here the requirements for a position in Treasury right. And let's discuss a little bit perhaps the tech side a little bit more. There's a recent piece on Treasury Management International discussing TaaB, that’s Treasury-as-a-business.
00;14;58;14 - 00;15;49;22
Unknown
No, I usually don't mind much buzzwords but I admit this one is pretty clever right. So to describe this, what we've been discussing here, say the new situation where the treasurers are placed. At one point in that article there is this idea that there might be, and that's a potential problem, legacy ERP systems in different parts of the organisation and well that's that's going to be a challenge right. And the piece goes on saying that there are other skills there that are going to be required, like knowledge of Treasury Management Systems.
00;15;49;25 - 00;16;14;02
Unknown
What is your position here? Because if I remember well, I think that's also some of the demands that are placed on you as a recruiter. Yeah. Typically, we also record the people we get to know over time, and those are quite a few and we keep in touch, what TMS they worked with before.
00;16;14;04 - 00;17;01;19
Unknown
So TMS expertise is a required skill and it very often comes up that the client says it would be great. It hardly ever is a must have. To have Kyriba, Bellin, Nomentia or any other TMS expertise. It is always a nice to have and quite a few of our clients say, and it's not really nice to say but it's the statement, if you know one you know them all. If you can work with SAP, most likely you can relatively quickly learn how to work with Oracle. What we know this much more recently, which I think is equally as interesting, is that it also goes the other way around.
00;17;01;19 - 00;17;49;29
Unknown
The labour market is really tight, and we have candidates who say if this potential new employer of mine doesn't have a TMS, I still worked with, for instance, Excel, right? We won't come because we don't want to work in an underautomated company where we have to do a lot of manual work. So TMS expertise is becoming kind of a given in the markets, especially when you focus on a company with a revenue over 1 billion and up. And of course the smaller companies, the automation level is not as high and that's where you see a kind of a bit of Excel or other systems in place.
00;17;50;02 - 00;18;35;14
Unknown
But TMS expertise is one of many aspects required. Now you mentioned, of course, spreadsheets, and that's a favourite subject to us here. Yeah, we like to say that spreadsheet risk is, of course, one of the operational risks that is perhaps not discussed as widely as it should be. And we also think that the best way, maybe not to eliminate but to tame spreadsheets, is knowledge of application programming interfaces, APIs.
00;18;35;14 - 00;19;20;22
Unknown
Do you see also this as a trend in Treasury recruiting? Well, not so much in recruiting, of course. I see the dominance and the prominence of APIs. And I think there will be an increase of the use of those. So at a certain, let's say conceptual level, everybody in recruitment in Treasury should be aware of the concepts of an API and how it works. In our experience, be it an API, for instance, if it's about bank connectivity, or a host to host, or any other connectivity.
00;19;20;24 - 00;20;06;23
Unknown
if people have worked in one or the other environment, with these types of connectivity is already fine. And we hardly have clients who expect their staff to know that say to go under the hood of an API and really know how to work in all technology aspects. So I think from a user perspective, which you might as Kantox people might kind of like perhaps is the transitioning from a over automated integrated situation where everything is connected, as mentioned, for instance, through host-to-host connectivity to all kinds of other versions, mostly using API.
00;20;06;25 - 00;20;41;29
Unknown
I think that transition is experienced as relatively smooth. So knowing that these APIs exist and perhaps also expand the possibility might be good, but it's not a real recruitment aspect. Really interesting, as well we’ve discussed that right there. APIs is the lifeblood of new solutions like Currency Management Automation that we provide here at Kantox.
00;20;41;29 - 00;21;26;25
Unknown
Now Pieter, let's broaden the discussion a bit and take into account also another aspect that is the fact that treasurers on finance teams in general have to contend with a growing number of stakeholders, both internal as we discussed some external. I’ve seen an academic paper recently showing, calculating the fact that the more or the higher the score of a company in corporate social responsibility, the more it will be inclined to hedge its exposure, be it
00;21;26;27 - 00;22;05;07
Unknown
foreign exchange exposure, interest rate risk, even commodity price risk and the hedging density there is. The use of derivatives also goes higher, the higher the level of corporate social responsibility. To what extent, and that's the question, are treasurers involved or should be involved in this conversation? Well, they should be involved because it's risk management. And of course, treasurers are risk managers.
00;22;05;09 - 00;22;40;08
Unknown
As your point is to the CSR connectivity to, for instance, hedging strategies, I think that goes beyond CSR. Because a company that is that professional that they want to invest in these types of reporting or methodology, those are the companies who are investing in next level risk management. That's what they're doing. And then kind of automatically, in my opinion, goes that if they want to think about the potential risk, they also think about potential risk mitigation.
00;22;40;10 - 00;23;18;09
Unknown
And the obvious in risk mitigation is for a lot of treasurers, all kinds of hedging strategies. Whereas others who are not as conscious about all kinds of risks also do not think about risk mitigation, and do not use the services of Kantox or any hedging strategy. So I would say that goes beyond, let's say the acronym of CSR it’s much more of a are you willing to invest as a company in such an important aspect as risk management?
00;23;18;11 - 00;23;54;07
Unknown
Yeah, that would be my opinion about that. Now, Pieter, we've come across recently a range of articles, papers and discussions about the ascending CFO. This time so that those CFOs that aspire to become CEOs and there's lots of them and more and more of them. So people are putting forward their skills, their risk management skills, their knowledge of almost every aspect of the business,
00;23;54;09 - 00;24;34;22
Unknown
their visibility, their role in crisis episodes. All of these as important elements, say, to climb the ladder further and become CEO. Can we make the same case, as you're a specialist in Treasury management, for treasurers and becoming CFOs? Or is it another discussion? Well, it's a discussion where we can invest a lot of time.
00;24;34;22 - 00;25;02;24
Unknown
And so I will try to give you a first a shorter answer. I think that depends on your personality and your drivers. So if you are a super specialist, then it's totally fine to remain a super specialist and there's a demand for that. I used to have a boss who would say, and it wasn't part of recruitment, who say if you if you study dentistry, you know your job at 65, you will be a dentist.
00;25;02;26 - 00;25;25;00
Unknown
And there's nothing wrong about that. Nobody will ask you, why don't you be a CEO of dentistry firm? No, you are a dentist. Well, the same goes for a treasurer. If you want to be a specialist, remain a specialist. If you think, okay, there is more to life than being a treasurer and a specialist, professional life I say, I want to have more impact.
00;25;25;02 - 00;25;46;26
Unknown
I want to become a CFO. That's totally fine. It's not an easy path to go, but it's doable. It's done before. But if you want to do that, then you should act upon that because it will not automatically come to you. So this could be the short answer. And if you let me I will talk hours about that, but that’s not what you want, I suppose.
00;25;46;26 - 00;26;30;03
Unknown
Well, we’ll have, I'm sure, the opportunity to do it another time. Now, Pieter, I really thank you for this discussion. We've been through a lot of topics. We started out with the idea of maybe treasurers moving beyond the pure financial department into the role of strategic advisors. You introduced, and I thought it was really interesting, this psychological aspect when viewing and assessing the, well, the role of treasurers, what skills they have, what are the communication skills in particular that you stressed.
00;26;30;05 - 00;27;02;00
Unknown
And we went on to discuss relationships with external internal stakeholders. Is there Pieter, something that you would like to add? Well, a final thing and that's something that came up, it comes up constantly in a big event. It is our responsibility as the Treasury community. There's talk about why doesn't the world see how great Treasury is?
00;27;02;02 - 00;27;37;25
Unknown
And we all see if we are professional treasurers, what kind of an impact can we have? We can reduce cost, we can create opportunities, we can mitigate risk. But bringing that message across is not the task of the outside world. It's our task as the Treasury community to think about, okay, how do we convince the rest of the world by telling the right story, using the right words, how great it would be if FX management, Treasury management in general would be executed better.
00;27;38;02 - 00;28;12;24
Unknown
So this is my call to everybody in the Treasury community. Go out there and talk to non-treasurers to increase our impact, because I think we can. That's right. That's absolutely in line also with our message. We always say, look risk mitigation is fine, and that's what we do. But the real purpose is, well, in our case in particular, to embrace currencies to drive growth and valuation, because that's ultimately what counts.
00;28;12;26 - 00;28;26;23
Unknown
Pieter de Kiewit, Treasury community catalyst and entrepreneur. Thank you very much for your participation today in CurrencyCast and I hope we'll see you soon again. Thank you very much for having me.
