Embracing Change and Trying New Things in Treasury with Mattijn Bak

Welcome to this week's Treasury Career Corner podcast where I interview treasury professionals about their treasury careers. Each and every week I talk to them about how they build their careers, where they are now, where they see both themselves and the treasury profession going to next. Let's get on with the show. In this week's show I'm drawn by my Martijn Bach, the group treasurer at Veon Food Group headquartered in the Netherlands. Veon Food Group are an international meat producer. We're production locations in Netherlands and Germany, offices worldwide. Annual revenues over 5 billion making them one of the world's top food and beverage companies. Veon supply customers home markets and across Europe and the rest of the world. And we had a really good pre podcast call Martin and I and one of the key things we talked about how this Covid crisis had been and effect on the world of supply chain. So we'll get into that a little bit later in the show but as always we want to hear about Martin's history and how you got started in your career. And I know that you started with a bit of a law background to then go into banking and then discover the world of Treasury. So bit of a an interesting start there sir. And as always over to you.

Good afternoon Mike. Like you said, I started studying law and during my law studies I also worked a little bit in law practice. Well for me it's personal of course it was not dynamic enough and then friend of mine arranged an interview with ING bank and I sort of landed the traineeship there, got to see all the departments and at the end made the decision to join the treasury cash management department of ING bank where I worked for a few years and I enjoyed but few years I got the opportunity to change seats or places with and join a Treasury department of Friesland Campina which is a, I guess one of the larger, I think top three in the world dairy companies.

You say you got the chance to sort of chain, you had really good cash management treasury background within the bank but then what tempted you to treasury as it such?

When working for a bank you tend to believe that what you are selling is the best product there is out there. You don't know what the implication is of your sale and the next steps in the chain are known to you. And then it's interesting to see what's more out there if you're on the treasury side of the business to speak to all these consultants and banks and they have all different palettes of solutions for a similar problem. Yeah, that's just a different view on things.

Talk me through then the role that you got at Friesland and what was that like as you start in Treasury, a corporate treasury, as it were.

I started partly as project manager. So one of the project was implementing a big international cash pool, for instance. And I also was. Because they have an extremely international footprint, so I got to travel quite a lot because they were, from a financial point of view, extremely decentralized, but they did not have the treasury knowledge or experience. So for instance, they have. In Malaysia they have a company with a few thousand people and of course a cfo. But the CFO does not know anything about how this should be financed and how the cash management works and fx. At the start I got the job to travel a lot and help these people set up a decent cash management, FX management and finance the company. I was sort of an internal banker because you got to learn a lot of cultures, a lot of banks and banks. Bank culture. That's fantastic.

And the role itself within the group, again you've been within food service or food groups and things for a number of. We'll bring that out as well with your latest role and things like that. What was that like in. In terms of some people, they're just within the services company, so you can't really touch the product and everything else. Did you get really involved in that, get to know some of the business?

Yes, although I do think that treasury has evolved the last few years more to a business partner than it used to be. In my opinion, it was more decentralized and more of a headquarter department than it's now. At least the way we do it now. That is of course different. But yes, of course when you start in the company, you need to learn the business, otherwise it's difficult to assess where you can add value. So yeah, I would always advise people who started a new company to make a tour through the company. You get to learn all the different traits and then it's easier to add value, also from a headquarter point of view.

So you did that role or a couple of roles there and then sort of grew your career and then joined. How do you say, Nutrico, Is that right?

Yeah, it's also an agriculture company. So from the dairy I went to the feed. Animal feed. Indeed. My last job at Friesland Campina was corporate finance manager. And then. So I did their project management, cash management and financing the company. And then within Nutraco I became the treasury manager, sort of an assistant treasurer, which was a broader function and also interesting because Nutraco also has an international footprint. It's on the stock exchange. It used to be on the stock exchange, now it's not anymore. What was already, I think, with the treasury at a quite high level, so it was more difficult to really add value, I think.

And then with the role there, you also made international moves and things like that. Or talk us through that.

Yeah. In Draco, the holding company was with not many people, so you got to know all the. About 60 people in the holding, whereas it was a big company, 4 billion turnover. I think so. And then every now and then we did an acquisition and then if you're close to the fire, they gave me the opportunity to join the acquisition as a finance director and to see and experience a new culture and a bigger finance job. So I was responsible for implementing the acquired company, but then hr, but also the accounting and IMT and what have you. So it was extremely learnful year, especially the first. First year, I think. And I would always do that again, although I did not stay in a function as a finance manager or CFO or finance director, because for me it's. The repetitive part of the job is not interesting enough. The rest of the experience was extremely learnful. Also, I think I became a better business partner because I now know how a finance manager thinks, what he has to do, what his priorities are and what not. Of course. And what experience they might have and what experience they might not have. So that makes it easier to reach out to him and connect. That's extremely important because you're always seen as a headquarter function which is extremely specialized with a sort of language not most people understand. And then you will only connect if you start talking to people and listening to them.

And let's just explain again for the listeners, because we sort of whiz past that bit, but actually you'd relocated and were actually based in Vietnam, is that right? Yeah.

And what you meant.

Yes. So what was that like culturally as well, sort of came in from a Treasury perspective. This is what I'm looking at. Treasury finance, you say it was people now listening back with, oh, right, okay. So someone might get into the business and have to move from the Netherlands to France or to Spain or something like, you know, or something relatively local. Might be differences and things. You were moving the other side of the world, you know, what was that like?

There's also a huge cultural gap if you move to France and it might even be more difficult. But I would recommend that experience to everybody. I think it makes you understand. Does not always. Your point of view is not the only point of view. And that's something. I think the experience of the business is that people from head office like treasury, but also control and what have you, and communications, they tend to think that their story is the truth. And people in business always struggle to understand why they think that is the case. And if you're out there on your own, because I was the only Dutchman in a company of 500 people, well, two French people, by the way, eating lunch and people start talking Vietnamese only. So it sometimes can be a little bit lonely. But nevertheless, you have to take initiative, you have to change things, you have to convince people because it's their country, their company, very useful experience.

You had that experience out there in the business and everything else, and then you return back to the Netherlands and things with that transition. What was it like transitioning back?

What I did wrong, and I think that's a good tip for most expats, is that I forgot to connect with the head office. So I was there in Vietnam for, what was it, just over two years. In the meantime, the CEO changed, a lot of other management positions changed. I think you have to connect to these people now and then more regular than not regular if you want your career to advance. Because in my position, I was someone they stopped knowing when I came back. And then it's difficult for the next step in your career. And I want to go back to Treasury. After two years in finance, there was no place in treasury in New Zeko, so there was no issue. It was more. More my problem than the company's problem. And then I left for. For a retailer.

So what would you have done differently? Reflecting back on that, you know, if someone again is in similar situation, they've made a transition, they're listening to this, the other side of the world, wherever it might be, and they. They've got a head office. How would you go about it, you know, looking maybe just reflecting on that. Is that to sort of travel back some sometimes and try and remake connections or how would you do it?

The times have changed, of course, a little bit, because nowadays you can easily set up a teams meeting and have a coffee with the new CFO for so now and then, or just have a chat with teams or zoom or what have you. But I would definitely do that. Yeah, I would travel more. Yeah. Stay more connected to the senior management in the whole day. Yeah.

Try and keep connected with those guys and you then sort of transition back in and, you know, before you then made a move to, well, this other group, plus Retail and things like that. What was that like? Or just bring us back to Europe if you like.

I did not really like working for retailer, to be honest. But that's something personal, I think for me, treasury job has to be for a company with an international footprint, preferably with some sort of distress, so that it should not be already at an extremely high level and easy access to liquidity and everything is working perfect for me. I like digging into issues and then adding value to the business. So that's why I think I was not the best fit for retail. Then I moved to Viom and that was something, of course, totally different. They were a company in distress, just sold one of their profit making units, business units or divisions to another American company and then we were left with pork and beef division and a small food service division which were, well, hardly making any money, just going back a.

Stage, you know, when you were making that move, what then as you said, you came in and I remember we discussed this briefly sort of thing before that you came in and it was a tough time for the group. Why join a company like that? Surely you want to join a company that's successful and no problems and everything, especially with a new job and everything else. Or did you think, do you know what, this is a great challenge? Or what was the sort of thinking from yourself, great challenge.

And I was sure that with my experience I could add immediate value. Yeah, there was not much when I started. There was all the systems were outdated, so there was no transparency of funds. There was all different intercompany relations which were not really documented. And also the finance facility was only extended for one year, so there was an immediate liquidity issue coming up. You have to like it, of course, but that is the exact moment where you can earn your spot at your spot at the table and add value to it, to the business.

Yeah, we talked about this, that you did a series of different projects. So was there when you joined, was there a real checklist of stuff to go through or, you know, was it just you looking at it saying, right, these are the immediate problems to deal with, let's firefight, put these fires out. Or, you know, what was the ethos when you arrived?

There was no to do list. As a treasurer, you want to have transparency of funds or you want to know what do I have available and when? Which is of course I think the top of the list of every treasurer. And we had some system issues were not serviced, we did not have a forecast. We. There was no decent. Yeah, there was a Treasury management system was outdated. Intercompany finance was not arranged.

So how did you choose it then? What was the methodology behind that? You know, again, there'll be listeners today who have walked into a similar situation.

Or if you want to move quickly, then you don't have the time to do an academic research program or project. So you move with what you know and you trust some of the consultants you know and go from there. So I hired one or two consultants and made everything transparent and they did not too much research, to be honest, but relied a lot on benchmarking. Yeah. So be experience of peers. So talk to them, reach out to them, listen. What is the best system to do that? This, do that and then make quick decisions.

If you could talk us through beyond as a group. So I know that I, you know, don't want to run out of time. I want to talk to you about, you know, how you reacted to the pandemic and everything else and how it's affect you as a business. But it's just overall. So you're an international meat company, so talk us through that, if you would, and how that, you know, impacts on Treasury.

That's the way we sell to other meat producers and retailers. We finance part of the supply chain. I have a book on in my office which has been written by a research lady who has followed one pig and what products are made of this one pig and where it was sold. And this is over 600 pages. It's unbelievable what the pig has, what it's used for. But in the end, to finish the story is that you buy a pig for say €100, and then your EBITDA margin is one or two euro, so you earn on the last few sales. So it's extremely difficult to make money in the sweltering business.

We discussed before that that knowing where it is in the supply chain and that tracking of it, that's a relatively new thing, if you like, but you've done it before. But now the technology is caught up and how exciting it is. Why is that important to you guys? The veracity of that supply chain for.

A future point of view. We and Viond really believe in sustainability and animal welfare and track and traceability. And I think that's what you're referring to. One of the projects we're doing now is indeed, if you buy a piece of meat in the supermarket, there's a barcode and then you can see where the meat has been, where the pig or cow has what he has eaten, et cetera, et cetera. So we tend to focus less on volume for the future and more on quality and transparency and building balanced changes we call it. So in the chain from feeds to the retailer, work together and have a very animal friendly, healthy product.

Yeah. Next and well, we talked about this. Everyone's bored of the pandemic. However, whether we are or not, that was a massive shift for you guys because a lot of it came out of China and there was lots of different things with you moving stuff around the world because you're truly a global business and supplies and everything else. Can you talk us through the sort of the impact and that sort of timeline if you like and how you saw that because then how you've seen it change and develop and everything else. We again we. We pre talked about this I thought was really interesting.

Of course what happened I guess exactly a year ago today because we're now beginning of March.

Yeah.

So this sort of was first Covid case in the Netherlands and then following a down and for a lot of industries, but not for food. We started, we kept producing but no one knew at the time what was happening and how it was spread and vaccination was not even close to. So we kept producing and being a slaughter company. We use a lot of migrant workers in general they only come here to make money. So they don't want to live in fancy housing and they tend to live in one house or with many people and work together and go together, go home together. Not spend too much money here, but because they want to take it home. There was a lot of COVID spread between these migrant workers leading to a lot of media attention for slaughterhouses and then the closure of some of them. We were in the papers every day almost at that time. We are of course our health and safety is one of the bigger departments within WIHL and as a top priority we do know how to act circumstances. But nevertheless this was better. Driving in the midst without help, it was difficult and we had to spend a lot of time and money to talk to local governments, governments, ministers. We did research together with universities and other academic companies. What didn't we do? It's been an extremely hectic year and from a finance perspective, because I was in the RIFT team we immediately because it impacts our customers and also the customers of our customers. So we have industrial meat and we have food service customers. Our food service customers, I think they were of course immediately impacted by the lockdown. Restaurants and food service companies were not buying any food anymore, but retailers were. So we what we immediately did, we looked at all the supplier Base, full supplier base, full customer base, and set up a risk management project to see where our receivable risk was heading to, how could we best manage that risk, etc. So it was extreme, energetic and I think it was interesting, but it was horrible, of course, for many people.

Yeah, yeah. Challenging times and things like that. And how did you then, as a Treasury team cope? Because you had a number, you know, was it all straight, working from home? And you. I know that we again, talked about your contingency plans coming to the fore and everything else. You know, what. What was that like? And then how have you as a group got through it?

I must admit that like many people I talked to with banks, with banks and other companies, it was easier than I would have imagined because, well, we were lucky that. Lucky that five years ago when I started, all the systems are outdated. So we briefly touched upon that already, but then implemented everything in the cloud. So we have a Treasury management system in the cloud, we have an electronic banking system in the cloud, we have a cash flow forecasting module in the cloud. Everything. Also our trading platform is in the cloud. So. So there's no. From a business perspective, from a Treasury business perspective, there's no reason to be at the office at all, apart from the teamwork, et cetera. But. So it was an easy transition, almost.

Did you miss that team element, do you think? Do you think?

Yeah, well, what he. What we do is we have. At least twice a week we have meeting or coffee break and then everybody dials in via. Via teams and we have a coffee and go through the agendas and. Or not over the weekend or. But just to keep in touch with each other.

Yeah. I spoke to Luke Fleming recently from Remy Cointreau, and we were discussing that he had these calls with team with no agenda. You know, it was just like, what's that about? You know, how has it been? And, you know, we were both joking about the fact that, you know, you can't exactly say, oh, yeah, went up to town recently, had a, you know, really nice weekend and we went out and everything else? No, no, it was like I got dressed to go to the supermarket. Great. It's just very frustrating. But how did you find similar. Or was it. What was the sort of the background to all of it, as it were?

We do go through the agenda, as always. This is sort of one of the meetings, especially on Monday, I must say, at the kickoff of the week, we go through, what have you done last week and what do you need to do this week and where can I help or where can someone else help you? Yeah, but that's the sort of the Monday thing and then on Thursday we always have coffee, just chat and I try to invite some of. Because I'm a bit more aware because I'm in the CFO team and. And then the Risk Compliance Committee and I'm a bit more aware of all kinds of projects going on. So I try to invite someone who then updates the team about a new topic or something.

Oh, excellent.

Does not always have to do something with treasury. For last week we had someone telling us about what's going on with robotics within Veon in the Shared Service Center. So that's interesting. And in this case it also impacts treasury because we immediately ask this person also to do one or two projects for us.

Amazing. Actually it's sort of. What's the word? Expanding the remit of treasury but you know, sort of linking up with other areas and actually that's not something I've heard that you know, I think really innovative as well.

Well, normally I do it by walking around talking to people and I came to the conclusion after a few months that I. That you do miss a lot. Also risk, but also interesting things you learn while you're having a cup of coffee or you're walking around and having a chat or just asking people of how they are doing. And then if you're only in the teams meetings all day and you. You might recognize that you go from the start of the day till the end of the day and then you wonder when you do your work. But there's no. You're just talking to the people in the meeting and only talking about the topic you're supposed to discuss in the meeting. Well, I miss the sort of the gray area there. That's why I try to.

Exactly that when I had this conversation with Luke, he recognized that as well those water cooler moments where they were just having a cup of tea, coffee or whatever, they're sitting there and they just talk and then one person sort of. And it's like the sort of. The ideas evolve and gain their own traction just accidentally, if that's the right way to put it. They sort of just appear sort of thing.

And then sometimes you learn indeed at the water cooler, hey, we're arranging a trade with China and for these and these customers. And then you think, hey listen, we might need to add some value there or ask them about what they're doing with the US dollar or how they financing it or it helps just to reach out to different departments.

Yeah. Get to Know them and everything else. And so we're not over Covid. That's the wrong way to put it. But as we start to sort of move out of this phase, what's the ethos? Are you going to all be back in the team, back in the room, back in the office straight away, or have you now seen this new way of working? What's the sort of thinking behind it, as it were?

We did not have any instructions or talks about this with hr. My view is it will be hybrid, I guess, of what we've done last year and what we did before that. So I must admit that many managers are not a fan of people working at home, but they probably have changed their minds about some of their team members for the last year. I don't think that everybody is made for or has the discipline or it's just not comfortable being alone in a room full day. So it's not for everybody. But it could be a good mix with two days home and three days at the office. So definitely impact, have impact, lasting impact.

I think that there's a social element to treasury which a lot of people I think overlooked. You know, there were lots of projects doing that's a great, great. But then they were like, oh, actually I could do with asking someone about it and that was fine. And then people then were, you know, reaching out to people and but the. Those conversations started to die down, you know, they weren't there so much and people like, actually I'd like to talk to someone about this or you know, just have that social thing and also mental thing as well. You know, you know, we overlook that people like contact. That's one of the key things I've noticed as well.

And I also think that many of the projects you do within Trash, you ask people to because many times it's only smaller departments. So you always need help for external from external departments to implement something and it always affects the business. So people have to change and. Well, my experience is that a lot of people don't like this, they don't like to change, they don't like, like to do that repetitive thing. I don't think implementation of a project can be successful without physically sitting in a room and explaining to certain persons why you're doing this and listening to their complaints and why they don't like it. And I'm not sure that implementation of a huge change can be done via teams or zoom or what have you.

Yeah, one of the other areas that we discussed pre podcast, you know, we're not that far off the end of Today show or coming up to some of the sort of, you know, talking to you about the future of treasury and things like that. But just put before we do that, one of the things that you and I discussed was about that you've got a wider remit than just Treasury. You do insurance, got credit risk and that this risk framework, if you like, there's much more material risk to a business such as yours than perhaps I knew before. You know, we were talking about some of the, you know, facilities for you guys and that's really changing and things like that. What's the sort of framework for that going forward? You know, how are you dealing with that?

So my responsibility is indeed treasury insurance and credit risk management and it's sort of combined, at least in my view it's a good fit because we use our receivables is one of our drivers for working capital. But of course we pay early and receive later. So therefore I think I told you that if the meat price for the pork price increases with $0.01 or with $0.10 then it cost me 10 million of working capital because of the volume and therefore it's for me. So we have a volatile working capital need depending on the meat prices. And this receivable portfolio can be used to finance that because it's moving communicating vessels and the credit risk management department, they guard the risk of the receivable portfolio. So they ensure this and they make sure that together with sales that we have no overexposure on certain customers. That's therefore it's a good combination.

I think within looking at the future Treasury I know that you like to use systems and you like to streamline things. Where do you see it going? Where are your again I often talk on the show that your CFO is pushing you forward. Say look, can you test that out for me? Can you check that for me? Where are you seeing it developing as.

It were real time data? I think that will be I think robotics, machine learning and all of this will lead to another level of transparency and efficiency. I think so in risk management. So I think the back and the middle of us will move more to shared service centers in combination with robotics and front office. The treasurer will become more business partner advisor than he then he is now. In the past spent more time gathering information on operational part of the Treasury. Now I think everything is available and you can spend more time on analyzing the information see earlier at an earlier stage where the future risks are and then manage it. That's I think the big change we're we were already partly there, of course.

Yeah, we're getting there slowly and things like that, implementing that, bringing back the team and everything else. What are you seeing as development for the group? You came in at a tough time. You know, it's. It's developing and it's growing and everything else. Do you see that sort of your treasury guys getting much more involved in the. The group as a whole or what. What are you pushing them to do or sort of. I think it was fantastic where you just mentioned about getting involved with the robotics guy, you know, talking to those guys in IT and things like that, getting close to them, you know, and that's a nice byproduct of this situation. But do you see that continuing or what are your thoughts?

Well, I think you must ask me how about recruiting? Is that it's difficult to recruit people. I prefer to have management trainees. So in my view, all the senior finance people, they are CFOs or seniors or whatever, they should have a stint, maybe half a year only with treasury.

Right.

And, and they. Because many times I have discussions with controllers, they have no clue about balance sheets or it's. Or how they manage certain risks. And I think they don't have to be able to manage it themselves, but they should recognize things and know that there are people within the company who can help them with it. So that's how I see how they should evolve from a HR perspective so much that I want to hire different people myself. But I think think we should change. I think. And treasury is about change, of course, because we are always changing things and people need to change as well.

So we're approaching the end of today's episode and as always, you know, our closing question to you is your top tips, if you like. So we've got people listening today that are in the early stages of their careers. Treasury managers and things like that. More junior than that. Then you've got mid level and then we've also got other treasurers listening today. You know, they like it and they're listening to it. Where they might be, you know, exercising or, you know, maybe even traveling to work. Some people might be by then what the top tips, if you reflect back. Martijn. And what would you say to the people listening today that you know, that they should be doing, if you like, in your opinion, to be successful like yourself?

I think they definitely should embrace big data. I think the future will be extremely data driven. You need to be able to understand and work with that as a person. I would, I would say to do regularly change jobs does not have to be per se. Changing companies, but that helps change cultures, change countries. Travel, in my opinion, is a very positive experience for every employee. And I think people should. I have a friend of mine, he always gives me the impression that he only works for the weekend. I would never do that. You should always work for fun. Work should give you energy and not cost you energy.

Yeah. Wow. No inspirational words. That's great. I love it. No, it's really good. And I think people will get some. Really.

You have to do something you like. Otherwise it's the lifestyle. Otherwise it's too weak, it's too long.

Yeah. Life is too short, you know, particularly in these times, you know, challenging times. But you still got to enjoy what you're doing. So now I think, great end to the show and thank you for your time. What we'll do, as I say, as always, we'll put your LinkedIn details in the show notes. So, you know, there may be a flood of people wanting to connect to yourself and, you know, getting to know you as well. I know that.

Do many people listen to the. To the show?

Yeah, yeah, yeah. This is. Each show gets downloaded over 250 times. Very popular podcast, actually. I mean, we're. We're approaching 46,000 downloads now. It's just incredible, right? Yeah. Then over 140 plus episodes. So no, you know, all that remains for me to say, sir, is, you know, I hope I get this right one more time. Is Martijn. It's been brilliant talking to you today, sir. Thank you very much for your time.

Yeah, you too, Mike.

Thank you, sir. Hello, it's Mike here again. I hope you enjoyed this week's show. If you did, then maybe you want to follow the show or subscribe, depending on where you listen, whether that's itunes, Spotify or another. Great. A great place to listen to the show from. It's totally free and means that you'll be the first to see each and every week when we release a new show. And maybe whilst you're there, you could even leave a quick review. Reviews and ratings are among the most important metrics for a podcast to effectively rank. And as you can probably appreciate, the podcast is a lot of hard work to produce every week. It'd be amazing. Just take, say, 20 seconds, leave a quick review of my amazing guests and their great career stories. We'd really appreciate it. Thanks very much and I can't wait to see you soon.