Pointers for Growth Within Treasury with Paul Hussey

Foreign 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. This week's show, I'm deluded. Nice to be joined by a really good friend of mine, Paul Hussey, the Director of treasury at Sabic. Now Sabic is a global leader in chemicals headquartered in Riyadh in Saudi Arabia. From making cars and planes more fuel efficient to helping conserve the world's water supplies. Colorful smartphone cases. Right the way through chemicals is their business. 33,000 employees globally operating in 50 countries. And I'm delighted to say that I placed Paul there a number of years ago. And we are, you know, we've been very much involved with building up the group globally. So, you know, some of the questions I asked Paul, it's a bit weird because I know all the answers, but we, as always, it's for you guys listening today that are gonna, you're gonna get some amazing insights from Mr. Hussey. Paul, take us back if you would, to the beginning of your career and how you first, well, first started finance and then you discovered the wonderful world of treasury, although it was in banking. But we won't hold that against you, sir. Over to you.

Thanks Mike. Delighted to have the podcast today. Pleasure to talk to you and to anybody who will listen into this. Yeah, it's an interesting journey, Mike. I guess from an early age I always wanted to be an accountant. Don't ask me why. I think it was more family relationships and yeah, family members who were, who were in accountancy. So I qualified accounting and finance degree in Dublin City University, then went on and did the professional exams and accountancy and I ended up first in central bank and that's how I ended up in banking, which I was kind of going, okay, this is a bit unusual but yeah, let's see how it goes. So really that started at Mike, as regards understanding. Like at 17, 18 years of age I actually had a really good leading search. It's equivalent BA levels in the uk. The bank had approached me and said, would you come in? So I did accounting and finance. Even though it was a full time course, I never, over three years, I never went to one lecture because I was working in the central bank. And at 17, 18 years of age it was like, good, goodness, what is this? What am I doing? But it gave me an appetite and understanding of the Future career now at 17, 18, I had no idea. It was like my interest was golf, soccer, rugby, Duran Duran U2, you name it. I didn't have any future mapping or where I wanted to go, but deep down it actually gave me the ability to look at banking. Is this for me? You know, I stayed there and then I moved to bank of Ireland, ended up in bank of Ireland's treasury, which previously was known as the Investment bank of Ireland, you know, corporate finance and the pure treasury side. And that's really where I started after four years in, in the Central bank, three, four years in in bank of Ireland, that stage I'd qualified and everything and anything I was going to do professionally. And that's how my career started. Mike. So started in banking, then moved into treasury, moved back into banking, moved into fund management, move into banking and then ended up in corporate treasury really for the last 10 or 12 years. So that's been the journey and Paul.

And part of that, when you then did the bank of Ireland, we had Sean o' Connor from Indeed on the show recently. Very similar background. Actually this, you know, did the treasury accounting piece because we sort of joked on the show that every treasurer should do their stint in the sort of middle back office, you know, middle office. But really, because then when you're passing down anything, even if you're right the top table, as you guys are, you then understand what you're doing lower down. It gives you the understanding the mechanics of things, you know, that was a good start for you. And then you sort of grew and talk us through the changes from there and how you sort of built on that foundation, as it were.

Yeah, Mike, you know, it's a great point. Like I ended up, I spent a couple of years in Danske bank as head of institutional banking, come back about 12 years ago and for me that was the, the foundation of moving into a comp where I was for 10 years. And then it's sabic. Having the background in banking is extremely helpful in the treasury world. You understand products, you understand simple things like capital weighting. How does that work for a bank? If you're looking for revolving credit facility, you're looking for different type of credit facilities. Be the committed, uncommitted, you're looking at trade finance products, you're looking at foreign exchange. How does a bank look at this? Because there is a few out there in the corporate world that's an endless pot of cash from the banks to fund, whether it's A, B or C corporate. Obviously that's not the case. So having that inside knowledge and for myself working with some of the largest institutions and corporates when I was in Danske and prior to that when I was in a couple of other banks, it gives you that appetite and understanding that you're talking the same message as your corporate banker when he or she reaches out to you or you reach out to them about a facility, because it does help. Because the lack of understanding if you are not in the inner circle is a fairly big thing.

And so then talk us through the moves as you then sort of really got more into core corporate treasury and made that transition over, because, you know, we've got some great moves and, you know, and that's what I want the listeners to hear. So I think. So talk us through.

Sure. Well, the one thing is, Mike, I've been very lucky. I've worked all over the world and that's a huge plus. So I spent a huge amount of time in the States, worked in Luxembourg, worked in Switzerland, worked in London, a lot of time in Singapore and then a lot of time in the Middle East. So looking at that treasury in its essence, what is Treasury? It's cash. We can put all sorts of bells and whistles around it, we can talk about embedded derivatives, we can talk about all the sexy stuff, but it's all about cash. Where's the cash? How do I manage the cash, what cash do I need and how am I going to utilize it? Whether that's for return investment on any CapEx program, or it's actually looking at simple structures. So for me, whether I was working in Tyco, spent a lot of time in the States, it was in Luxembourg, Switzerland, as I said, I was in Dublin, obviously for a lot. For a lot of the time as well. Or whether it was a comp or ended up in Abu Dhabi and Dubai for six years, whether it's sabic, now that I'm in Riyadh, with a large international presence, it's pulling all that together, the international experience. I think the one thing I'd say to any of your listeners is paramount. It's the understanding of the different mechanisms and how culturally the banking system will work in these jurisdictions. The other thing I'd say, Mike, is to actually have a wide range within Treasury. I spent a lot of time in corporate finance, I spent a lot of time in legal and general bearings and fund management when I was in London. Now in sabic, I'm over cash management and operations and having the front office, middle office, back office, understanding everything goes together. People would say to me, oh, Back office, what you want entrance to do with that, that's the lifeblood of where treasury is. You know, the activities, it's the settlement, it's the process, it's the confirmation. The front office is obviously, you know, a lot of people want to do the front office but if I look at the three of them together, front, middle and back, it's basically a marriage between the three of them. And there should be no discrepancy or there should be no lack of understanding of what treasury is about across those three areas. So international experience, understanding the products obviously front, middle and back office is a key determinant for anybody to understand and grow within Treasury.

And so just give us a quick run through if you would because you know, you gave a very good summary, you know, before getting to your latest role. But so you were working Tyco Electronics, then you did your Dansker and then you did AECOM for 10 years. And I think what's he there I just wanted to bring out is the differences between the industries as such. So Tyco Electronics later years became part of Johnson Controls. But you know, what was that like for you treasury wise and one, you know, we don't need to go into massive detail but it's like some, someone's listening say oh actually so you know, what did, what did that give you? What did Tyco give you? Treasury wise?

Yeah, so Tyco, when I joined Tycho in the early 2000s, Mike, it was such an interesting company to join. You know we absolutely huge company, over 2,000 legal entities, 288,000 employees. Like say for example in Germany alone with 110 different legal entities just in one country. But when I joined Tyco was going through huge change. There was issues within Tycoon which was part of the determining factor with a couple of other companies like WorldCom that brought Sarbanes Oxley into play. So the whole world changed on its head. It was like later in my banking career when the whole issue of KYC, AML and compliance came in. But what Tyco, WorldCom, et cetera went through in the early 2000s brought Sarbanes Oxley in. That brought a better, much larger understanding of process controls, the ability for leadership, CFOs, CEOs to understand that the controls that were inherent in the business was a huge factor within treasury because obviously treasury, we managed the cash, we managed the balance sheet, we managed capital structures. For me in Tyco, it was this massive, extremely well run, internationally focused conglomerate that we split in 2006 and seven into Tyco Electronics, into Tyco Healthcare, which was Covidian and then has moved on again into what's left to Tyco. So, you know, working in that. And in 2006, 7, it took us a year, we did the largest demerger. We were a $45 billion company and we demerged the whole thing into the three standalone entities. So every company has its own identity and it's different, but the core relationship is that the underlying essence of treasury is similar. It all goes back to one thing. It's where's the cash? How do we get my hands on the cash? What cash do I need? And this is front, middle and back office. Again, Mike, to what I went back earlier, it's the marriage and the cooperation between the teams to actually drive the business forward. And I think the one thing I saw in Tyco and I saw on AECOM and I'm seeing in Sabic now is the relationship between the business and Treasury. If I go back to when I started my career, treasury was a fairly simple outfit, but really it has to be a business partner with the business. It has to be there. It has to understand what the business is doing. The business needs to understand what treasury is doing, that you're not sitting in treasury on your corporate high table going shouting down directions. There has to be that relationship for this to work. This marriage will only work where the three units within treasury and the two units within corporate. Corporate treasury and the business are one.

So I recently spoke to Claudio Di Moli at igt, the sort of gaming group and things, and he said very similar stuff to you, but one of the things he talked about and you just touched on it there was about the evolution of the role of the treasurer or head of treasury, whatever it might be. And we're going to, I'm going to bring that into your experience at eecom, if I could. Because then as you say, and he was talking about the, what he'd seen because he's sort of straddled like yourself, the sort of European treasurer role and being based there where treasury is a very much a support function and it's very, you know, a lot of internal focus and everything else. But actually in the US and when he was there he said, oh, it's more of an investor relations, a much more external focus role. And you talked about the combination of both and obviously you encompass both and enjoy it and we'll come to your current role. But when you then moved, you then moved through Danske bank and then you joined aecom, what was that like? So, you know Been with Electronics Group, done this big massive demerger. You then done some banking again, gone back to that because you knew it so well. But how come then the move back into corporate and what did AECOM do? I know obviously, but the people listening.

Today, yeah, aecom, another fantastic company, extremely well run, excellent management. Mike, where the one thing we grew by acquisition. When I joined AECOM in December 2009, we were 5.1 billion turnover. When I left AECOM nearly 10 years later after a six year stint in the Middle east, we were just over $20 billion company and we grew by acquisition. We made a lot of acquisitions in the area we were in. ACOM is, is one of the largest, if not the largest design houses in the world. Has at one stage, you know, we had, we had close 90, 90,000 professionals in the engineering, architecture, construction, design focus. So you know, we would, we would. In aecom, it was like building multibillion dollar infrastructure programs. When I say building, I mean from design through to construction supervision, all the way up working with contractors to actually build a project which could be rail, could be airports, could be ports. It could be the huge infrastructure projects is what we specialized in. So that in itself it was totally different than Tyco. Taiko was electronics, Tyco was healthcare, Tyco was security, like an ADT or sensomatic. ACOM was infrastructure. AECOM is different in the sense that you'd be working on a project and then you move on to something else. It was more consultancy based and then Tyco and obviously totally different again than Sabik. That can get onto. But again it goes back to it. Is that treasury in itself, Mike? It's keeping it simple and it's keeping a focus on what matters to the cfo, to the CEO, to leadership. And again it goes back to cash, it goes back to business partnering, it goes back to looking at the correct products and projects that work for treasury to keep it as simple as we possibly can. Every company is different. We can talk about a multitude of companies, Mike, but it comes back to one thing. Corporate treasury within A, B or C should have the same focus. The business model is totally different, but it comes back to the same thing. Cash, cash and cash.

And when you joined aecom, was it very much that again, I want to get onto your current role and things and some of the stuff you've done with Sabic and stuff. But when you join aecom, was treasury at the heart of things or was it a support function? What was the ethos there sort of thing when you joined?

Yeah, very Much the heart of things, Mike, run slightly different than other corporates or, you know, other companies that have been in. Obviously we were, head office was in, was in Los Angeles. We had Dublin, we had other satellite offices, treasury offices for, for tax reasons and for structuring reasons. But it was, you know, I, the main team internationally was run out of Dublin. We had a small treasury team, but we were very, very strong treasury team. And you know, one of my colleagues now is that I worked with is now the group treasurer of Ryanair. Everybody knows Ryanair, you know, one of the most successful airline companies. So there was a great ability to hire and retain talent, work with head office, spend a lot of time with head office. You know, we structured programs and projects together within aecom. But the thing was there was a great correlation between the different teams, as I say, front, middle and back office. And that was slightly structured differently than what we had in Tyco and certainly what I have in Sabic. But all for the good, Mike.

So talk us through then, you know, you got placed by me at the group and Sabik, so talk us through your role there and you know, what was it like? You know, and also, you know, maybe we touched on the fact that you're based in Riyadh. You know, so it's really. Treasury has taken you around the world and you've really embraced that throughout your career. Talk us through that.

I moved to Riyadh literally nearly a year ago. When I took the job, Mike, with Sabic, obviously Covid had hit. I couldn't get to Riyadh. I was in Dublin, which was great. I was with the family. And then the 2nd of December last year I moved over to Riyadh. You know, Sabic, obviously it's an extremely successful, extremely well known company. Brand wise, we're, we're number two globally in the chemical market. We got taken over in October last year by Aramco. We were previously 70% owned by PIF, which is the public investment fund of Saudi Arabia, the sovereign wealth fund. Then Aramco came in and bought the 70% stake. There's a really good fit between Aramco, obviously the world's largest oil company, and Sabic. We'd be number four, number five globally in the chemicals market. And looking at the synergies between Saudi Aramco and ourselves is an absolutely great fit. So with that, Mike, we're working closely with Aramco to grow market share within different jurisdictions. Sabic, while we're Riyadh based, obviously we're very large in Asia. We have our hub for capital. Savvy Capital One, Savvy Capital Two, which is the rest of the world, based out of the Netherlands. We have a very strong global treasury team and we're going through transformation at the moment because we're looking at how we can even make it better. I think this is one of the things for treasury, it's that you can never stand still. You need to look at is the program and is the team and is the structure correct. And we're looking at that in Sabic at the moment. You know, through yourself, we. We hired an extremely strong group treasurer in Rob Farrow who came into us just over a year ago. And you know, being based in Riyadh, I had worked in Riyadh previously. I was on common from AECOM to work with parts of the parts of the Saudi government, Saudi customs, the national center for Privatization. Because I had special re specialized in structured finance, PPP and PFI in the last two, three years in AECOM looking at major programs and actually undertaking to assist our client base putting these structural financing initiatives in place. So Riyadh is a wonderful place. It's changed so much. It's a pleasure to be here, Mike. People look at Riyadh and they kind of go, oh, well, Riyadh. All I could say to any audience or anybody listening in is that. But it's so progressive under the Crown Prince. It's making a huge initiative to change. It's going to be the epicenter.