How Decentralized Growth and Centralized Treasury Drive Global Success Across 21 Countries

Foreign.

To this week's Treasury Career Corner podcast where I interview treasury professionals about their treasury careers. Each and every week I talk to treasurers 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, delighted to be joined by Declan Dawley, the head of Group treasury at DCC PLC headquartered in Dublin. DCC PLC is a leading international sales, marketing and support services group actually listed on the London Stock Exchange and part of the FTSE 100. They provide solutions the world needs across three transformative sectors, energy, healthcare and technology, where they acquire, improve and grow diverse businesses. Now I'll get Declan to explain that a little bit later, but the businesses are amazing. So over 21 countries, four continents, 16,600 employees to create long term value for that is their aim for shareholders, customers, society and the planet. That's enough of that. I'm going to go back to how Declan first started in finance and then into treasury and everything else. Declan, over to you sir.

Thanks, Mike, and thanks for the invitation to join your show. It's fantastic to be here. Yeah, and thanks for the introduction on DCC as well. So yes, we've been around a listed company for 30 years. We've had very huge success in that time. The up profit growth has been 14% over that time period. Free cash flow conversion is at 99% over that 30 years. So it's a real focus on cash generation, buying cash generative businesses and really delivering for our shareholders, adding value. So you're right, we do operate in energy, healthcare and technology. Our energy business is 74% of our profits. So that's a real focus for us from a strategic point of view. And one of the things about the D.C. business model that may not be the same as a lot of the businesses you talk to, we operate a decentralized, devolved model. When we buy businesses, we encourage the team that were that we bought in with the business to remain and we incentivize them to grow it. And really from a central perspective, we provide strategic direction. We also manage all capital allocation from the center. And then from a Treasury perspective, clearly we manage the cash and the future funding needs of the business. So that gives maybe a quick overview of what DCC does and what it's like.

And just before we move, we'll go back to the beginning of your career in a minute. But actually I'll jump in there because I know when we had our original briefing call just going to that decentralized centralized model. A lot of companies, when they go and buy someone, they go in and strip out all the staff and centralize it. Why is it so different with you guys?

It's a model that has worked really well and it's been going for 50 years as a company in total. Right. So we believe that having the local people in the business drives those businesses to be stronger. Right. So that's from a couple of perspectives. One, they're closer to the customers. That's clearly a good thing. And also then to drive local growth, we would take, we might take a position in a sector in a particular country. Right. And we will then encourage and incentivize the local management team to build that business. For example, when we bought our first fuel distribution business in the UK a long time ago, it was a small business, but now it's the leading fuel distributor in the uk. It compounds, it grows. And you encourage the local teams to do that. I think to do that from a local head office based in Dublin would be much more challenging to have that local expertise. The entrepreneurship that local businesses have and to maintain that over time is part of what's made DCC successful.

And then you. And. But you have a centralized treasury, centralized finance or how do you run it then?

Yeah, sorry, that's a. Yeah, great question. Each business will have their own finance function and back office, let's call it. So we will have, for example, we might have three or four businesses across the uk, we might have certas, flogas and they are all separately managed and they will all have their own finance teams. Now the exception is from a Treasury perspective, we then bring in all the cash into the center. So cash is king and we part of the job in treasury as to risk manage, obviously protect the assets of the firm of the group and also to manage liquidity around the group and to allocate capital as the group sees fit as we decide. So the. So it's a. Yeah, so it's a devolved structure, but the controls are really ties around what we do with our cash. And that is. So from a head office perspective, we have a Treasury function, we have the likes of internal audits, we have divisional management teams, etc. It's pretty light at head office level as we say, the work is really done and the customer closer to the customers in the local jurisdictions.

Cool. And so let's just go back for a moment. You qualified as an accountant originally way, a few years ago now way back when. But talk us through your career and how, how it's evolved.

Yeah. So it's. I suppose I was thinking about this earlier in the last couple of days. It really goes back to the upbringings. I became a chartered accountant, as you say, a long time ago. It was really important to. When I was growing up my, My parents were quite strong on getting a good education and then having a professional qualification behind you. You got to bear in mind that these. That they grew up in the mid mid-50s was when they started their work career. So they've seen all these economic cycles and they believe that there's a resilient income from having a professional qualification and that informed my decisions of initially becoming. So after doing a commerce degree, ended up in KPMG for a number of years in their financial services side. And that was a huge experience. It was massive. And the exposure you get to a number of different types of businesses and just the caliber of people as well as was excellent. I had a following maybe 10 years in financial services between stockbroking company and the Irish Stock Exchange and then one of the biggest. They were mostly finance roles. Also risk management played a big part in what I did in the stockbroking company. I set up a risk and compliance function so from scratch. That was a really interesting time. That was during the. What we had in Ireland during the Celtic Tiger years. I don't know if you remember those, but it was a super time and really good work. There's a lot of regulatory change coming in at the time as well between mifid and many others. So that was a really good time and quite a broad experience just for me actually.

I. Obviously I've been a recruiter 25 years in treasury, so I, yeah, I was recruiting during that time all the way through and it was a boom time just for our overseas listeners and maybe some explain what the Celtic Tiger means and what that sort of period of boom was.

Yeah, it's. I'm trying to figure out the easiest way to explain what was. It was a time of huge economic growth.

Yes.

It was a time where the. There was a. Essentially a very big boom. Right. And it was driven by probably lending without having controls, some controls, but maybe not being followed to the same extent. Right. So you ended up with just a significant bubble and a valuation bubble. Actually it all came down and crashed in 2000 with. I think Lehman was the first bank to really suffer. And then it rippled in, but rippled around the world. In Ireland we had a particular love of property investments, I think, and our banks fully supported that as well. And when the Valuations really started to suffer. It ended up unfortunately with a lot of people really with kind of liabilities that they just couldn't meet. And there was a period of recovery then after that, which was really difficult for people at a personal level. And after that a lot of rules did change, for example, leverage rules. And yeah, look, there was a lot of learning for, particularly for regulators and for individuals, I hope from that because it was pretty serious stuff.

And then it was at that time then you joined Circle K or Topaz Energy, explain who they were and stuff.

Yes, Topaz were ultimately bought by Circle K. Topaz were the biggest four course and fuel importer in Ireland. So we had wholesale, commercial, run, retail and forecourt operations. So it was quite a large, it is a very large operation in Dublin. One of the things that attracted me to that was after spending maybe 10, 12 years in financial services, actually being able to see the product that you're. The business you work for sells, that was something that was quite important. So that tangibleness. So being able to go out onto street and see whether it's one of your trucks or it's a forecourt. And that was really important to me. They wanted somebody to come in to set up a new risk management function and that's what I did. So it was reporting to the CEO and to the board, the chairman of the board. And it was a really great insight. So that role allowed me access and visibility across the entire operation, from health and safety particularly, and then into financial risk. So it covered quite a broad spectrum that gave me access to nearly all areas in the business. I think when I look back at that role, one of the best experiences I had is I managed a project of a cultural change program which was safety led. And that was one that actually had a strong impact on reducing injuries at the workplace. That's real personal benefit to myself and to others obviously as well. And so then during that role, a position in finance became available and I stuck my hand up for it and went for it and I got it. And that was probably one of the more defining decisions in my career where, you know, so I moved into that finance role and ultimately became the head of finance in Topaz. And we. And then in that time we bought the Esso assets in Ireland, which is a really great deal. And then we sold the business to Circle K, who are a Canadian international fuels group and convenience food stores and a very strong operators. And then after that, DCC was a company that I was always interested in and I got the opportunity to join them. Interestingly when I was working in the stockbroking company, one of the companies that was performing that I was following and also had bought a few shares in it's very small was DCC back in say 2005. And I joined Topaz going maybe this would be a stepping stone into dcc. So that kind of. That worked out really well. DCC had a need at the time to set up a commodity risk management function. So the commodities that DCC would have been involved in were predominantly like propane or fuels based. And more recently there's a lot of electricity and gas as well, and natural gas being a devolved structure. One of the things that the board and the management team wanted to greater sight of in the center was that commodity risk, the pricing risk associated with commodities. So that role was to increase, to bring it all into the center and build a center. Yeah, exactly. So that was. And that was a great. And again, it gave me great exposure to businesses around your particular.

I remember we had our call way back when and we talked about the fact that now commodity risk management is coming into Treasury. You actually started with that. So you started the other way around, which is great because then you got into treasury, but then you went through finance and then we came into Treasury. Was that something that you used as a springboard or is just something that you just knew about?

So it's something I knew about more from the Topaz role where I had the. There was commodity exposure there that needed to be managed. I brought that into, then brought that into the new role. But I think the main thing was like I joined DCC because I knew there were good people there, really good people. And I knew working at a headquarters would put me in a position where if you're good at what you do, then you get noticed and then there's an opportunity to progress. So after two years of setting up that commodity function again, I got the opportunity to be finance director of one of the divisions, so the retail and oil energy division. And that was to me, that was exactly why I joined DCC in the first place, that sort of role. But yes, and that would not have happened had I not taken that commodity risk job.

Yeah. And then you did the finance director role before then. A lot of people do treasury all the way through. You then joined treasury more recently sort of things and then did first credit rating and everything. So what, how did that come about?

Yes, I was again just fortunate. So I joined and took over the treasury function two years ago. After four years of having a finance role, divisional role, the Opportunity to get a group position was really important to me. And again, being in that center, close to decision makers is really important to me. So look, the opportunity came up and I was in the right place and I had the capabilities and there was. And that was seen by others. And that's, I think that's the key. It's not, it's sometimes I think there's a bit of luck involved in these things. But then you think about what does that mean? It's really where I was building capabilities over many years. So as you're preparing and then an opportunity comes and you're ready for the opportunity and you can take it because you've been expanding your capabilities for many years and having a group role then is. Was an opportunity that I definitely jumped.

And then you, since you come in, you've got a couple of firsts. You've done the first credit rating, you did the first public bond and a lot of. In fact, I was just talking to a client yesterday and a couple of candidates recently said, oh, I've got to get this, I've got to have some bond debt, capital markets. And I've said no, it's good to have, but it's not the be all and end all. There's lots of other stuff and we'll come on to that with automation and employees and stuff. But what were those processes like with the credit and the bond?

Yeah. So there again, how fortunate I've been to take over the responsibilities of treasury while the organization was ready to get their first credit ratings. And DCC has been very active in the private placement market for almost 30 years. Right. Funding is not new to the group, but what is new is going to the public market. So the board made a decision. That's where the direction we should at least have the optionality to be able to go to the public market. So getting credit ratings was the first step in that. That was a, it was a fantastic experience going out to the rating agencies, engaging with them, getting some support to do it as well and going through the kind of coffee meetings all the way through to formal presentations, formal assessments. I find this again, it's a way of you're representing the group and you're presenting the credit story of the group and it's, it's fascinating.

And if someone else is listening today and they're going through a similar process or they're going to go, maybe prepare themselves for that, any hints and tips or things that you've taken away from it going do this, don't do this and Actually, this is the way we should have. Or what were the learnings, if you like.

Yeah. I think first thing is I think the rating agencies want to work with you. So it's something they do help a lot and they're extremely good at what they do. Their analysts are very sharp and very. And they having some kind of coffee meetings with them is a very useful thing. Also a bit like what I did. Anyway, you talk to people who have done and gone through this process before, and there are also companies or institutions or banks who will help you put together. Whether it's like your presentations. You can. You definitely need sounding boards for all these things. So I wouldn't do it. I wouldn't do it alone. I would do it with some support. Whether so. Absolutely. Even though, as I said, the credit rating agencies are very helpful. Very good. But you still. It's a different. Unless you're used to it, it can be a different language almost and there's different emphasis as well. So I think it's. And it's a process that you just have to invest time into.

And then you did that and that then led on to the bond offering and everything else. What was similar process or what was that like?

Yeah, we got the credit rating. So that would have been November 23rd. And then six months later we had established an EMTN program. So that. That allowed us to make some issuances. So our one issuance so far, the whole process there was again really intense work. We are. It's very high profile, very public by its nature as well. And you need the right partners to work with on that as well. Again, similar to when we talked about the credit rating earlier, it's about who you pick to work with you as well. So whether that's legal, you might have an advisor, you might have some banks working with you or whatever. But it's. And the whole process, it's almost lined up in two different zones. You've got the documentation process, which is very burdensome and intense. And it depends on your corporate structure. Obviously, if you've guarantees, guarantee companies, if you have not every program is going to be the same. Most definitely not. So you have the legal process at the start and then you enter. Once you're ready to make an issuance, then that becomes a whole different thing where it's much more about investor relations, talking about the DCC story, talking about our performance, talking about the solidity of our balance sheets, how we manage our balance sheets, our low leverage ratios and doing road shows. So it's almost like Two different skill sets that you're bringing to the table. So that legal side, then your marketing side as well. So it was a great process and again, it takes a lot of time, takes a lot of investment. But it's really interesting.

Sorry, just to jump in from the beauty parade side, the roadshow, if you like, and you're going around there and then you were choosing the banks or choosing your partners and things. And actually we get a number of the listeners actually come from that side of the table, if you like, and you're the treasurer side of the table. What made them stand out?

We.

You've got three or four different banks. I'm not asking for names, don't worry. There was one. You go, yeah, they just get it or they just don't. What is it? Would you say that sort of identifies them? Because again, this is a bit of a tip for those guys out there. This is what you should do. I know when I've done a lot of our. It's quite interesting. A lot of the guests we've had on the show, particularly from the Nordics, they often come from the banking side. They've been relationship managers. So they know they get to share the pain of a lot of treasurers and then they go and become treasurers themselves and then they know what it's like. That other side for you, what was the sort of. What was the defining factor or actually the flip side? Don't do this sort of thing.

Yeah, that's. That's extremely. When you're going through the. Who do you work with? In the first part, that's extremely difficult because we work with the best banks in the world. Right. And they're all extremely capable. How to differentiate? Of course you can differentiate because they have some. They have their own unique ways of working. But that's extremely difficult. I think from. It's probably easier to start on the legal side. We want to work again with the best that are out there, particularly for the euro market. And that's what we did. We would have gone and talked to quite a number and we've existing relationships with some as well, so that was okay. And then on the bank side, we all know the kind of share of wallet kind of structures that we have to deal with. And when we considered it, one of the things that was really impressive was the amount of investment each of our partner banks put into getting in front of us, helping us with this. And ultimately when we had to narrow down the choice, the choices was very difficult. So we would have used things like league tables we would have and some other metrics to try and help us make that decision. But also it's. We'd like to go back to the market again at some point and we want to make sure that it's a fair process for those who've made such a commitment and investment in supporting dcs. It's not. Yeah, for the first one, that was a hard one because. Yeah, you're testing the water. And also it was a few difficult conversations where people who maybe are banks, that could have almost as easily been there and he just. There wasn't enough room, not enough bandwidth.

No, that's fair enough.

That was tough. But again, everyone was very understanding and.

Moving more on to the treasury team that you have. If you want to talk through. I just want to talk through the. So, no, employee engagement is a big thing for yourself. You mentioned it earlier about the sort of safety projects you've done, but also, I know when we spoke, you having that relationship with your team and everything else. Can you just talk to that for a moment?

Yeah, it's. It's something real important. So there's 14 on the team and we have varying lengths of service, let's say, within that, and treasury operates in, say, in D.C. headquarters. And we in the. Almost as a. It's a unique enough function, it's quite specialized and we have a fantastic team and we've got some. We've got a really nice structure to it now between cash management, banking controls, financial reporting and it. Right. And it works really well. One of the things that always working on is making sure that people feel and are contributing to the best that they can. Right. And. And also that people are enjoying their work so that they look forward to getting into work every day and they're getting something from us. Outside of clearly salary, there's something. And there's a nice. Encouraging, a nice dynamic there. So we've. Yeah, we do spend quite a bit of time over the last couple of years trying to improve that. And I suppose thinking about the ways that we do that, what's important is communication, how we talk to each other and also keeping the team fully informed about broader. What's going on in the broader company, in the broader group, providing an ability or providing more space for, say, listening to ideas for people to use their voice, which I think is a really important part of it, and then empowering people where we can. And there's two sides to being empowered, because that also means you're holding people accountable for completing and doing work to a high standard. And by doing That I believe anyway, that you're allowing, you're giving them the room to grow and develop and I think that's really important. And then the other part on engagement, I think, again, which is as important as anything, is having a few socials thrown in where you can get together informally and, and that's not always easy. Right. People's lives are busy and people have other commitments, but certainly getting a few lunches in during the year, a couple of nights and, and just getting to know each other a bit more rather than just at the desks, engagements. We've more to do on it. And I think you never, never, you've never, you never hit us and go, oh, that's done. Because it's an ongoing thing. So it's about finding ways of doing it and working together.

And I know the, the other topic area we, you and I covered before was much more about automation and AI and we've got all the. It's the hot topic, isn't it? It's every conference. God, if we got paid a pound for every, a euro for every. That's it, we'd be rich. We wouldn't need to work. If we saw Enough on, on LinkedIn and everything else going through with you guys. I know automation is a big thing with DCC and the treasury team. What are your thoughts?

So if I was to take AI specifically, we are, as a group, we are using AI, but it's more for sales and for sales optimization. Let's say from a Treasury perspective, we have pretty good technology in Treasury. We have a Treasury management system. We have all the usual things. I would say part of what we've been doing over the last couple of years is actually using that technology to its ability. Right. So when I, when we talk about AI and we talk about what the future might look like and use of technology, I get puzzled because I go, are we using our existing technology to its capabilities? And we generally aren't. I think it's probably common throughout most organizations. Does AI, hopefully. And it's not there yet anyway. It might make things easier, but for any technology that I've seen, we're not even using it to its capabilities. We've been spending a lot of time trying to upscale ourselves and use the technology we have. So that means, yes, you're investing in it, you're investing in time, but let's say it's a process of improvement, of continuous improvement. I think AI will be massive, but we just don't know where and when or how. And it could even be the Case that it's a bit like when we use our mobile phone every day, you already have AI working away.

Yeah.

And you're not really that conscious of it. It's just working away and you just evolve into it and it's just something that becomes part and parcel of your daily routine. I think from probably from a very specific treasury perspective, it could be very helpful in cash flow forecasting, in improving accuracy on that and also on risk management in general, which is an area that, if you think of it, we would spend a fair amount of time verifying beneficiaries as an example. There's definitely ways that can be improved, so there will be plenty of pockets where AI would be really important. But I actually, my main point now is, are we using what we have to help us as well as can.

Where do you see it? You partially answered it, but where do you see treasury professionals needing to focus their effort to develop themselves? Is IT data and then this clarity and everything else? Maybe when you're recruiting, what are you looking for from the outside world when you're looking for candidates and things like that?

Yeah. So I suppose you can. It depends on the role, because technology, as you say, and data technology is becoming so much more important. It has been for years. But actually being able to use it, there's a mix of having treasury knowledge, financial banking knowledge, and mixing that with technology knowledge, and being able to set up your systems and your architecture that allows generation of good data in order to make better decisions. So there is. So I suppose that brings me back to the kind of characteristics that I look for in somebody we're hiring. Good academic record, just showing that. Diligent, strong communicators. I think you got to have a base technical offer as well. So whether it's a finance or whether it's, as we talked about in technology, that's really helpful. And then the curiosity and the app, the aptitude to continue to learn, really important. Somebody who brings that energy and drive and is quite willing to take ownership. That's really important.

And how do you assess that? You're interviewing someone, how are you measuring that? I know that I'll partially answer it. I know that some. One of my previous guests, we talked about this a bit on the show and one of the key things he said, you can see it. I said, what do you mean? He said, not just face to face, but you can actually see it in their profile and when you go through their cv, said, where did you make a difference? Where did you actually change things? Where did you. And if someone says they just followed the routine, yeah, they're not going to make a difference per se. They're just like, yeah, they're happy. Yeah, ticket, take the box, turn the handle. What? But then they were saying, actually, I got bored of this. Oh, no. But I thought I'd improve it. I was talking to someone yesterday, they'd decided to study Python to help them, because it was like they. It was a personal interest. They said, actually, it made my job a lot better. And everybody else around me, they're like, yeah, we want you on board. Yeah.

Yeah, Mike, I think that's it. It's interesting. You talk about, you can see us, you can cut. You got to ask a few of the questions that lead into those discussions. Absolutely. I think when you hear of somebody who's able to follow a process as it is diligently and at the same time going, hang on, this could be better, we could do X, Y and Z. And in an interview, asking for an example where you spotted something that you think you could improve and what did you do? How did you go about it? And, like, clearly how you went about it is so important because you're communicating, you're bringing your idea and you're not just going off, for example, on a solo run and doing it right without engaging people. So there's. Yeah, yeah. When you see that, it's a bit of a sparkle, isn't it, that people have sometimes that's really. It's great when you have it. And we're lucky enough in the team that we have plenty of that, so it's great. Yeah.

I want to be respectful of your time as well, and you've given us that. So we'll put your LinkedIn details in the show notes and everything else. But obviously you've had some time and we were talking before that. You've looked through the questions I asked and everything else. And if you look back over your career, if you're listening today and you're.

One of the listeners, bit of advice.

Would you give to the audience that are listening to today's show?

I think it is about partly following your instinct, developing your technical, being ready for opportunities and being able to understand when those opportunities are there and being brave enough to take them, because you can be thrown out of your comfort zone, but that can be a really good thing for you, for your personal development.

Amazing.

Thank you, sir. And great to thank you, Mike. Yeah, no, the good fun. There you go. And, yeah, we'll put the LinkedIn details in the show notes. So be you'd be very lucky to have Declan in your Rolodex. There you go. And people go, what's a Rolodex? You and I know back in the day. So thank you very much, sir. Great to chat to you and look forward to seeing you. Thank you.

My pleasure. Thank you.

I hope you enjoyed this week's episode just as much as I did, recording it with another amazing guest. And feel free to sign up through wherever you get your podcast through Spotify, Apple podcast, wherever it is and keep on listening. Thank you very much for your support. Now, before we move on, I wanted to let you know how you stay ahead in the future treasury world. So you'll see in our show notes how you can sign up for our Treasury Recruitment newsletter. It'll give you immediate access to our 2025 Treasury Salary Trends white paper. In there we've got assessment of things coming from the salary survey, but we actually go back over the past 20 years. We look at some of the insights there. We then also can give you some strategic career advice. We give you bonuses like access to CV and resume templates, things to basically help you with your treasury career.

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