How to Manage Treasury Teams with Andrea Paulis

So welcome to this week's Treasury Career Corner podcast where I interview treasury professionals about their treasury careers. Each and every week we talk to treasurers about how they've built their careers, where they are now, and where they see both themselves and the treasury profession going to next in this week's show. Delighted to be joined by Andrea Paulis, the executive VP and group treasurer at CNH Industrial. Now, for those of you who don't know, C and H Industrial are a global leader in capital goods that implement design, manufacture, distribution in commercial and financial activities in international markets. And everyone's like, oh, what really what that means is they've got 12 brands and they make the vehicles that keep both agriculture and industry growing. So from tractors, combines, trucks, buses, powertrain solutions, big vehicles, basically you've got massive manufacturer, 66 manufacturing plants, 64,000 people employed. And Andrea will tell us a lot more about that and how he first got started when he joined the group number of years ago. But for Andrea himself, he's literally traveled the world and we were just talking about this before we talked the, you know, intro'd the podcast, as it were. So this is one of the things that I noticed with Andrea and before when I read his resume, I was really impressed that actually some treasurers, they sort of sit in one and then look at the rest of the world. Andrea has actually traveled and lived it through his treasury career. So without further ado, enough chat from me, Andrea, maybe if you would, can you take us back to the beginning of your career and how you first ever got started in finance and then discovered, luckily for us, the world of Treasury. Over to you, sir.

Absolutely. Thank you, Mike. I started my career, in fact in Paris in 1996, at the time for the FIA group. I just graduated from a university in Milan and I decided that I didn't want to stay in Milan. I wanted to travel and I wanted to discover, have new experiences. So I went to Paris, which was a city I lived in before when I was a kid, and I started looking for a job there. It was finance for sure. That was kind of what I studied at university and I wanted to have an experience in finance. Even though I have to say at the time I wasn't sure that would have been my career going forward. I looked many different places. It was not easy. It was the first job I was looking for and then suddenly I request for an interview from Fiat. At the time, France was the second market for the Fiat group was a very important market and they had, as a group, they had a big Finance company based in Paris and they were looking for junior people like me. So they asked me for an interview, it went well and they offered me a job within the treasury team in France. It was new to me, I have to say. I didn't know exactly what to expect, but I was open to the opportunity and I was willing to learn and I started there and I found it actually more interesting than what I thought originally. I had probably not a very real view of treasury coming from university. I think it was a very much, kind of a different, different view that I had in mind just to ask.

You that, because I've talked to people about this before, that sometimes now people are getting an introduction to treasury through their university degrees, or sometimes it's actually a module within there, but you'd not really covered it, or this was brand new, you walked in finance and a bit of trading or what was your impression of it at that time?

I think, well, it depends really, from universities, it depends from the countries and I guess specifically to my point, in Italy, universities are pretty good, but they are very, very theoretical in the way they're studying. So I don't think they really teach you about what you're going to do next. I think they give you a lot of background, which is very good. I also studied in the US afterwards. It's a very different methodology, but they don't really give you an idea of what's next. So when I went there, to me, finance was more like kind of an accounting work, really, looking at flows, making sure everything was working properly and we were supporting the business, kind of a controller job. But I wasn't sure really, again, what treasury was about it. That's when I discovered it, when I went and started working for Fiat. In very practical terms, I started as cash management, in fact, and I was working on a small cash management as an assistant treasurer for Belgium. For Belgium. So it gave me like an introduction, but it was a small group of people, so it allowed me really to look around and to see that there were other different things that the treasury people were doing. And treasury was a much broader experience than what I was just doing at the time. So that was really the first step.

And then you made the move to your Paris. And then, as I said at the beginning of the show, you made a series of international moves. How did you know? Was that something they told you you had to do or you selected or how was the sort of transition? Was it you driving it or them or the company, as it were?

It's a combination of things. I always say that in life there is a 50, 50. 50% is things happen because of your attitude and your skills and. And 50% the time. Things happen because of the opportunities that come. I was obviously willing to learn, I was willing to discover new things, and I was very willing also to travel around. So I did my part. When I got to Paris, I started working really as a junior person. I was open to do anything, including doing copies for other people. So really, I had no limits of what I was doing. And I think this allowed me to get in the right environment and the right attitude and to grow. And then an opportunity came, in fact, because after just, I think, maybe a few months, I was there. The person who was actually in charge of managing the position of the group in France went to maternity, and she went away for two years, in fact. So they were looking for someone else to replace her for these two years. And there were people that were more senior than me at the time. Again, I just started a few months before, and they decided to give that role to me. It was a challenge. It was a challenge for the company. It was a challenge for me at the time. But I decided to agree on that, on that challenge. And it went pretty well. And everything else came from there, that point, because the company at the beginning asked me to stay maybe at least the two years that I was covering for that role in order for them to commit in making me grow in that role. And then, not even after two years, maybe a year and a half, they actually asked me to start a program, a master program full time in finance, where Fiat was a sponsor of the program. And it was actually per se, already a program where I had to travel, because it was a program made by three different universities, one in Italy, one in Monte Carlo, and one in New York. And so I had to travel between the three universities to complete the program.

And with that, you then sort of. You aligned that, as it were, to some of your other moves, because then you moved through Fiat within Turin, and then you did Dublin. How did those moves come about?

Then again, after the Master program decided to specialize in something which was relatively new for Fiat, which was structured finance. Securitization. Securitization was a new field, a new area in Europe, especially in Europe and especially in Italy, there was a law coming. In 1999, when I graduated from the master program, which allowed for the first time securitization transactions, Fiat wanted to be ahead of the game. And I understood that when I was studying. So obviously, by doing this specialization in the Master program. They I was the right person to look at this kind of transactions. Again, another opportunity came because in 99, Fiat bought a company which was called Case, based in the US And Case was a company which was active in agricultural business and in construction equipment business. Fiat also had a business in agricultural and construction, which was New Orleans. They bought the company, they merged the two entities, creating C and H Case New Orleans. And they were willing to better understand the American company who was already working in these kind of transactions since in the 80s, actually was probably one of the first companies working in this kind of transaction. So they sent me there, they sent me to New York after the Master and before they sent me to Dublin to work with a small team which was structuring securitization transactions in which TM and Fiat had a 48% participation. So they allowed me to grow with this team to look at certain transactions in Europe, especially one transaction in Italy, which was the transaction that opened the market in Italy. It was a 1 billion euro transaction from Fiat. So Fiat opened that market at the time. And then when I grew there for less than a year, they asked me to move to New York, which was really what we were discussing for me to look at the new company, understand what they were doing, how they were doing it. And also again, looking closer at all the structured finance transaction they were negotiating there. So it was an opportunity again, I was willing to travel and they were willing to let me grow in different locations, in different environments. So that was my next opportunity. After the Master and after Dublin, were.

You then starting to manage people as well or were you up to in that sort of journey?

New York was again a Treasury vehicle, so it was not a big office. We were probably five, six people. I was not the treasurer at the time of that company. I was kind of the second in charge, even though there were four minor apart from the treasurer. But I was sent there kind of being his right arm. So I have to say that I created myself a position where I was helping him in managing people. The treasurer at the time didn't have too much time to say to focus on that. And so I was willing and able to do it. And I think that also helped me in the next move in the group. When the group understood that I was able to manage a team, it was a small team in New York. I was not given the power of doing that for, but I was able of doing it.

And then. So you were in New York and you were doing this role as very much more capital management, some cash management. In there, but there's sort of a very capital markets intensive type role. And then you made the move and you know, just for, again, for the listeners, you've stuck with the group all the way through this in some really interesting times. But then you then made the move back to Europe or then this came about. Talk us through these moves because fascinating big roles and things like that. So your role's growing and growing sort of thing.

Yeah, the move was growing. The role was growing. After New York, I think that obviously I was expecting to have a role into being a treasurer in one of our treasury vehicles, which were around the globe. We had many treasury vehicles and actually before me, other people followed the same path. What surprised me really was that normally people like me were sent to smaller countries, smaller markets. Since it was really the first time that we were given the challenge of managing a company and managing few people. Probably the group thought that giving you the responsibility over a smaller market, if you were doing a mess, it would have been limited. After two years I was in New York, I was again called back in Torino in Italy, where the headquarters of Fiat, where at the time, by the time, group treasurer. And he actually asked me to move to London. Now, London was the location of the main treasury vehicle for Fiat. Treasury vehicles in Fiat are companies that are there purely to manage liquidity. So access funding from the markets, cash management, provide liquidity to our companies, keep the relationship with the banks, with investors, with the agencies. So that's really their pure, their job. They are not industrial companies. And London was the biggest company, Fiat at the time. The position managed by that team was pretty sizable. We're talking about billions. All the bonds were issued by that company. Most of the bonds I would say were issued by that company. It was a pretty big team. Eight people were based in London and that was the front office of the company. And another 12 were based in Luxembourg, where the back office, middle office accounting were based. There was also responsible of the office in Luxembourg. And so there was not really a CEO of the company. They asked me to move there in London. I have to say at the time I thought that the challenge could have been a little bit too much for me as the first time, no one before was given that opportunity. And I think that was probably the first time I got something that helped going forward in my life. I remember I went back to Torino. They made me this proposal. I kind of had some doubts. I said, maybe too much. And I remember a dinner with the at the time group treasurer who looked at me and he said, well, I'm giving you this opportunity, therefore it means that I trust you for what you're going to do. Are you telling me that you don't trust yourself? And so I'm wrong. And obviously when he said that to me, I felt that I had to take that opportunity, something that had to come. It gave me a lot of trust, to be honest, also self confidence to myself and so I decided to accept.

So again with someone listening in today and if they're, you know, how did you come to that decision in your head, you know, I. E. There'll be someone listening today going, crumbs, I'm being offered that same opportunity. How did you reconcile that? You know, how did you think?

Right.

You know, worst case is it goes wrong and I come back. Or what were you, what were the thought process before you went, you know, by him saying, you know, I trust in you to do it. What internally with you comes back to.

A recurrent theme that I already mentioned even before, is that I give myself and I think through for Everybody, it's a 50, 50 target at the end, 50%. It's your attitude, it's your skills, it's your willingness to understand and listen, it's your willingness to do things and then 50% is the opportunity that comes. I think the fact that I was proposed to work in London to the main treasury vehicle of Fiat was an incredible opportunity that probably would have been given to me just once if I had said not at the time. It doesn't mean that I would have probably lost my job or anything else, but maybe I would have settled for something less. That opportunity was very visible in fiat, allowed me to be visible with a number of people in the management and I was still in a kind of a medium sized management role, but I think it allowed me to show that I was capable in doing things and I could grow further, which then happened. So I like to mention a quote said by Walter Kreisler, it is about opportunities that they come and when they come you need to grab it. There are many people that don't see these opportunities coming and so they let them go. It is to me extremely important that you are able to look at opportunities to understand when they come and face them when they come.

And then you were taking on a lot more responsibility. Your sort of roles grew and grew and you were both in London, Luxembourg and then you made the move to Turin and things before and getting to Chicago. And this is why I wanted to sort of get on to the next things. But you carry on. I Mean, explain. You know, you really grabbed it by, you know, you didn't let it pass you by, you grabbed the opportunity. And still, you know, relatively young age, you were, you know, managing big teams and real challenges.

Yes, the move to Turin, that was actually interesting to me because when I was in London, the person who helped me grow over all that time, the time the group treasurer left the group, it was 2007, we had many changes in fiat. We went through a kind of a cycle there. Since 2004, Fiat was not in very easy timing. We had changes, the very high level, and the group treasurer, which became at the top. At that point, CFO decided to leave the group. So there was a change. And for me, it was not an easy one, because for the first time I thought I had lost my mentor somehow, right? The person who really drove me through this growth. And so I went to Turin once to meet with a new person which was coming from the group. It was another person working in treasury was asked to become the group treasurer. And I met with him and I thought that actually I had to rebuild everything from scratch. It was not the case. I think the person knew me for what I had done in the previous years. And again an opportunity came. The person was managing financial markets for the group, which means centrally, which means really managing the debt side, managing the fixed income relationship, managing the rating agencies, managing the bank relationship, and left the group as well. And so that person asked me if I was interested in joining Torino, actually the headquarters for the first time. And I thought it was a good idea. I thought it was a good opportunity for me to get a little bit more central in the corporate. And I decided to accept. So that was 2007, so 2007 to 2011. Now, in that period of time, so those four years, two things, two exceptional things happened. The first one was the big financial crisis in 2008 and 9. It was, I think per se, was the most important experience I had to manage. As I told you, I was in charge of the financial market. So really I was in charge of liquidity. Fiat was coming from a long time of its own personal crisis. It was going up in ratings. We had just reached an investment grade. And then the financial crisis came. I remember that it was a very quick change for us. We had good performance, we had good liquidity ratings going up. Then suddenly everything changed in a very quick time. And so we had to react immediately. That was, I think, a team effort from World Finance, from the group treasurer. To me, as a financial markets person, my team and I have to say we were able to manage that crisis pretty well. I think that the reaction time we had was incredibly fast. We were able to secure funding transactions which really ensured the group to have its own liquidity to navigate during that time. By the way, Fiat lost its investment grade immediately. So it was the TYP fallen angel, just I think six months operating on investment grade. And it was, as you can imagine, those times was extremely difficult. But it proved that the school of treasury in Fiat and especially the way we have been managing banking relationship over time was paying out for us. The banking relationship side is a long term work, it's not like a short term interest. So some of the banks that have been helping us over time were able to help us even in that time and then we were able to help them when they needed us the later part of that year. So again, very, very intense experience. I don't know if I would like to repeat it. I think anyone else is enough. Once is enough, absolutely. But it really allowed me to grow further. And the second one was the step that came before I changed again, which was the demerger. In 2010, Fiat decided to split its non automotive business. So as you mentioned, the kind of agricultural, construction, commercial vehicles businesses out of its automotive business. In 2009, Fiat bought Chrysler. And so the automotive company was becoming too relevant, too big for the rest of the business. So they decided to split in two. And they asked me as head of financial markets to work in certain flows. One was the capital structure of the new groups. So the debt component of the new groups, which One of the two was not even in place in 2010. So we had to work on something of a group that was not even there, with no ratings, nothing. And we were able to do that with a panel of banks and then making sure that there were no negative surprises on the ratings side, both on the remaining entity and on the Spanoff entity. So I worked on this process again, another pretty complex one, a first time for me, but we were able to work on it pretty successfully. And so when we got there, I agreed with the treasurer, group treasurer at the time, so that I wanted to change my role and I wanted to get a little bit closer to the business. Since then I always had been corporate, full corporate person. So I felt I was missing really the business side, where the needs are coming from. And I wanted to have a better understanding of that. So I asked the possibility to move closer to a business. And then in 11, I remember in January, the group treasury asked me to move in Chicago, where the treasury of the cnh. So the agriculture and construction equipment business at the time was based, was a segment of the group, but it was a full entity with its own governance because that was a listed entity in New York. It had its own governance, it only management team, treasury team. It was a little bit more independent than the other businesses. So I accepted and I went there.

And what was it like again, you now big leadership role. So 30 plus people. You know, you've come from Italy, you've, you know, you worked all the way across Europe and suddenly you're thrown in the deep end in, in the US how was it different in terms of, you know, what was it like to manage people there? And you know, maybe did you find it a contrast from managing people in Europe?

Yes, quite a lot. I think what helped me is the fact that it was not new to me to now start in a new environment. I had been in New York before, I studied in the US as well. And I kind of the attitude and living in different places, I think I had the right attitude. But US and Europe, especially Italy, are very, very different. The way that people. Well, I mean starting from the people, the way the people work. I think US is a much more structured environment. People like to work by rules. It's a very structured workday. It's a very actually precise workday. You schedule your day from the morning for the afternoon. You have all your, imagine your agenda, your meetings or your calls, everything you have to do. And you try to stick to it, which to me looks very efficient, to be honest. I don't want to generalize too much on that because I don't want to say that Americans are like this and Italians are different. But in Italy it's much more destructured. So we talk a lot, we meet a lot. We tend to be a little bit, I would say in generally speaking, a little bit less efficient. On the other side, I think the plus is that when you get to a point where maybe you have to get rushed into certain things and there is no time to structure the process, then I think this is where Italians actually can excel because they are used to that. So in terms of emergencies and really rushing into finding solutions, then I see where Italians can really find the solution in an easier way. The people are, and this is the mentality I found a little bit in the various locations. Even the way you manage people kind of follows that you cannot manage in the US A puritanism like you manage in Italy or in Europe, it's a very different way. So I mean, yes, it was different. I don't think at the time I found it particularly difficult. I just had to adapt a little bit myself to the new environment. And as anything, anytime, any other time, I had to learn about the new environment. So it took me some time in any case to kind of learn about the new role, the new responsibility and the new attitude.

And you say about the working, you know, that working structure, that's fine. But then also you're a big leadership role. How did you sort of lead that team? Again, this is to give some of the guys, you know, the tips. You know, they're listening today. They might be in a, you know, making their first step into leadership of a much smaller team. But, you know, were you very right? These are the goals, guys, and this is how you're going to do it and everything else. And we'll do that by 9 o' clock, that by 9:30, because that's what they fitted in. Or what was the sort of way that you managed sort of thing and led a team like that? What were the key tips for leading a team at that size?

Yeah, not particular. I mean, these are styles. I don't think there is a style in my style. I like to discuss, I like to listen. I think it's more like a team effort. What I don't think is right is to. On one side, I think the team likes to see you, that you are part of the team, you are part of the discussion. You're not just someone that sits on the top and the decision comes there and you don't even have to think about it. It's what it is, right? So it's good that you feel that you are part of the team and they feel that. On the other side, you don't ever have to feel hesitant. I think that would be extremely wrong. If you hesitate, if you look undecided, then you provide uncertainty to the team. So I think it's always good to listen. It's always good to talk to the team and with the team and to listen to their solutions. Maybe they are better than yours. But at the end, you need to make the decision. Never allow the team to get too far away because otherwise you kind of lose control. That's what I think.

And then, you know, the role itself transitioned back to London sort of in most recent years, sort of the past, what, six years or so again, why was that? Or sort of talk us through?

Well, another change in 13, we merged CNH, which was, as I said, one entity, one group owned by at the time the holding was called Fiat Industrial. So the other business, holding the other businesses, we merged CNH with Fiat Industrial and we created a new entity which is called CNH Industrial, which now owns all the entities, all the segments. And this new entity is a dacha entity, an MV domiciled in the uk. So London is really headquarters. And when we did that, there was a lot of discussions happening to decide people that should move to London to the headquarters. And they asked me, since I had people I had been living there before and had people of treasury working in London, they asked me if I was willing to move here. And I said that it was absolutely fine to move in London. To me, I think London is a great place, especially in my job. If I think about it, all the banks, most of the banks that we work with really follow us from London. They do their management decisions in London. They do their credit work in London, even if they are not UK banks or European banks. So London is a great place for me to be. And I became the group treasurer of the new entity, the CH Indust. So now my team is, you Remember I said 35 people when I was working in CNH. Now it's 120 plus people localized a little bit everywhere in the world.

And looking at the future and as you see treasury developing and we talk about this every week on the show and things like that, where have you seen the greatest developments in recent times and see it going to the future, what's the key thing on your mind?

I think it's increasing complexities, really. And probably this has to do also with the changes in technological evolution. The speed of everything has changed completely from when I started. Technology allows you to do much more in much less time, but also gives you many more challenges that I didn't have to think about when I started or didn't see people think about when I started. I'm talking about cybercrime, security frauds that can happen, geopolitical issues that now treasury manages. Because, for example, the insurance market allows you to cover for other risks that were not covered at the time. So it's really the complexity and the number of issues that you have to manage is different from what it used to be. At least the perception I had when I started working seemed to be much more concentrated on liquidity, cash management, risk management, meaning interest rate effects, maybe commodities. Now it's a much more complex issue, number of issues and in a way that makes even things more interesting. And on the other side, it allows treasury to still be a strategic partner of the management. I think when we have all these issues. The management I see here likes to get back to treasury and ask for treasury support for things that may not be a full treasury activity.

What do you see as the biggest challenge, then, for treasury in that sense? What are the dangers? We hear every week about Cyberware. We hear about all these different things. What are you keeping looking over your shoulder about thinking, oh, hang on, guys, we're going to keep an eye on that? Yeah.

The challenges are the same thing as the opportunities. I think they come together. I mean, when you have an increased speeds of things, when you have an increased number of challenges of issues, it's much easier to make a mistake, it's much easier to make something wrong. So you also need to increase your focus and being extremely careful in what a team of 120 people does around the world, because you can have issues everywhere, anytime. And so you need to make sure that you have full control of those processes. You need to set up a structure which works without asking you to leave 24 hours a day, seven days a week. Right. You need to be able to relax and stay. So the controls are important. You need to be able to set up a structure that controls risk. You need to be able to set up a structure that is able to act quickly, to react quickly, and that, for example, can stop frauds. Maybe you are alerted to the fraud. If you act immediately, you can stop that fraud before the fraud can be successful. Right. And these things keep happening all the time. With the technology changes, it's becoming more frequent that you get these kind of things. Cybercrime, again, something that you can look at it from a Treasury perspective or an insurance perspective. So these are, I think, challenges becoming more and more frequent, more and more.

Fast and with yourself and, you know, now you've grown your team management, if you like, now, you know, over 100 people that you lead and you sort of look towards. Obviously you've seen talent at all levels, you know, junior talent, mid level, senior level. But what are your thoughts around talent management? Things like that, when you. When you meet people, interview, are you looking for the first thing out the game must be technical expertise, that's the number one thing. Or is it an attitude or, you know, again, for people listening, they're thinking, oh, you know, what should I be looking if I'm interviewing people? What are you thinking about all the time? What's. What's the sort of. What's your catchphrase? If you like, what's the thing that's really sticking with you in your mind.

When you're recruiting, maybe it's me, it's always attitude. I think that attitude made a difference when I started. It allowed me to grow and therefore I think it's extremely important. Now, obviously it depends on who you are looking for. If you're looking for a person that maybe needs to be there for a senior position, obviously you are also looking for a decent background, technical skills and experience. But if you're looking for a more junior position, I think the attitude is, to me, the more important thing because I started by learning on the workplace. I remember someone at the university saying, don't lose too much time in university, go and graduate as quick as you can because every year you lose is the year that you lose at work in the workplace. And I think companies in general, they like to train and grow their own people anyway. So the right attitude to me is the most important thing. If I see that a person is quick, is smart, is willing to accept its role and its seniority and is willing to put himself or self at a challenge, then I think that's the most important thing. Anything else can come and will come by the way, because every company anyway is different in doing things I don't expect. The way we work in treasury is exactly the same. Other companies work in treasury and this is what I hear when I talk to other treasurers in other companies and.

With yourself, let's sort of. We've done all the way through your career and we've done you as a manager leader and then we're bringing it back down to you because as we. This is, you know, as we wrap up today's show, I want to sort of focus in. Someone will look at your career on LinkedIn and they go, do you know what? I want to have a profile like that. You know, what are the main tips you've given? I think that's a fantastic one and that will stand out definitely that you know not to be afraid to take those challenges. And is there anything else you think is important that people should think about? All the levels of seniority or whatever it might be. What are the other tips you'd give? Because we'll give you a LinkedIn profile in the show notes. But what other final tips would you give to people?

Yeah, again, I repeat myself, I think attitude is very important. Accepting changes is extremely important. We have training with my group, not only with my group in the company here, continuous training about accepting the change, which is probably the most complicated thing for someone. And then I would say also networking is important. Maybe that's one of the things that I didn't think it was so important at the beginning of my career, I always was fully focused on my job and I think, in fact being able to connect with people, maybe people like you, people that gives you different views, allow you to grow even outside of the company that gives you a lot. And so this is something else. Networking for me is incredibly important as well.

Amazing. I think it was great. I really enjoyed today's show. Thank you for your time. As I say, if people want to connect to you, we'll put your details in the show notes. Andrea, just suffice to say you're incredible treasury professional. You've got this amazing career. I think people will see that when they look through your LinkedIn profile. You go wow. And it blows you away. So, you know, just thank you for giving us your time today. And if you want to connect this right to be as part of his network, then feel free to.

Thank you very much. Thank you for your time.

Thank you, sir. Thanks for the time.