Timeless Skills in Treasury with Group Treasurer, Adam Richford

Hello, it's Mike Richards here from the treasury recruitment company. I hope you're enjoying the Treasury Career Corner. If you are great news, perhaps you give us a rating on itunes or wherever you consume your podcast content. This means that even more treasury professionals can benefit from finding out, or by finding out about how treasurers have achieved their career goals. The link to rate our show will list at the bottom of our show notes. And please remember as well, the show itself is as much about you as it is about us. There are specific questions you want us to ask or there's feedback you want to give. Please drop me an email. My direct email is mikeresuryrecruitment.com inventibly enough, but anyway, that's enough from me. Let's get on with the show.

So, welcome to this week's Treasury Career Corner podcast where I interview treasury professionals about their treasury careers. I talk to treasury professionals from across the world about their roles, how they built their careers, where they are now, where they see both themselves and the treasury profession going next. In this week's show, I'm delighted to be joined by Adam Richford, the group treasurer at Renewee prc. Renewee is a leading European waste management company focusing on the European and North American markets. Renewee collects waste and recycles it back into usable materials. So you've got recycled paper, metal, plastic, glass, wood, and then that comes out as energy contributing, as they say, in a concrete way to a circular economy. Their mission, simply stated, is waste no more. The Renewee Group was actually created in 2017 following the merger of the UK Corporate Shanks Group with the Netherlands based company Van Ganswickel Group. They're listed on the London Stock Exchange, have more than 8,000 employees spread over nine countries, 200 sites across Europe and North America. Now, for some of my shows, I've given increasingly long overviews. Me chatting away of my guest careers, but I'm stopping that. I want my guests to tell their stories more than anything. So, Adam, originally you started your finance career with ey, the global accounting firm, perhaps kick us off there and how you started your journey.

Yeah, thank you, Mike. So, yes, absolutely. I started my career at Ernst and Young at a sort of fairly typical way into finance, doing the Chartered Accountancy Qualification initiative after university in a major Big four company and getting a good exposure to lots of different clients and different experiences there. And like many people, after qualification, I looked to do something a little more interesting than auditing afterwards and joined the consulting practice within Ernst and Young, focused on turnaround and that was really the first exposure that I had then to treasury functions. So a lot of underperformance ends up in the Treasury's lap for responsibility to manage the cash flow and other issues through difficult situations. So that was sort of the first glimpse into a Treasury function was there in the consulting environment, which I then followed on into a corporate environment with a fallen angel Telco, which is my first line of responsibility for a Treasury function, a company called Energist back in the day. And then that led into a career in treasury thereafter, which was started in GE Capital where I worked for about 10 years and then got a Coral group before now joining Renew eplc.

Okay. And with the, you know, so going through from those early times at Energist and things, that was your first real experience of Treasury. What was it that grabbed you about Treasury? You, how come you got the role or how were you recruited into Energist? And say, right, can you come into treasury please? And you're going, what's Treasury? Or you know, give us, give us that.

Yeah, sure. I think what I particularly like about treasury from the very beginning and still do today, is that it sits high up the corporate agenda. So a lot of the strategic activities that are being considered by the company have a Treasury implication or requirement. Whether that's as it was in some of my early assignments around turnaround and underperformance, or more recently in terms of growth and corporate acquisitions and M and A and mergers, where in each case there's a Treasury activity that needs to be managed, there's an impetus to doing it is strategically important for the business to be successful in doing that. And that provides a lot of dynamic activity and a lot of excitement, a lot of interest and therefore a lot of scope to add a lot of value to the organization that you're supporting. Which is also then coupled with the more routine aspects of the treasury function to manage on a day to day basis as well. But it's certainly for me, it's the dynamic elements that keep me most interested and excited by the career and Treasury.

And then you went to ge, working within their real estate business. Explain how treasury was structured there and team wise and what was the role like?

Yes, I mean GE's a massive company. It had a large financial services business and therefore an appropriately large corporate treasury function, the majority of which was led out, out of the US so it might have been around 500 people in total. My role in that context was much more sitting within a business unit, helping them think about the treasury issues associated with all of their activity. And in the period that I was there, we did a lot of corporate acquisitions and acquisitions and disposals of real estate properties and portfolios, initially starting with creating a single treasury function. Following a couple of delisted companies that were taken private by GE in the early 2000s, we established a Treasury function. We grew that portfolio both in the UK and Europe, and then during the financial crisis, we then diversified that into a lending product. So we bought a number of lending portfolios, particularly from distressed sellers like Bradford and Bingley and others at the time. And so it's always evolving in terms of the strategy for the real estate business. And sitting there within the treasury function was all about listening to what the business was doing, helping them understand the implications from a funding perspective, from a financing perspective, from an interest rate risk or FX perspective, to contribute to that deal team and make sure that those deals happened and were managed successfully in.

The business, like GE, GE's massive and everything else. And someone listening might think, well, hang on, how hands on was he when he was surely just sitting back telling people what to do? And I know, for instance, it wasn't because we recruited for you at the time and stuff, but what was your ethos around treasury then? And how did you get your hands on it?

Yes, I mean, I think in an M and a driven environment, as the real estate business was, and it's very much understanding the idiosyncrasies of each of the individual transactions being a key part of the deal team involved heavily in the due diligence of the. The assets that are being acquired, to understand the cash flows of those assets, the exposures that are associated with that. And I think treasury particularly came into its form as we migrated from looking at owning buildings to lending against buildings. And a number of the portfolios that we were acquiring had fixed rates loans and therefore embedded within them, there was a mark to market on the interest rate of the loans themselves, as well as a recoverability issue associated with the value of the property relative to the value of the LO itself. So that was one of the things that we did in those first acquisitions was to really get under the skin of what the embedded value of the interest rate risk was and then how that influenced the recoverability of the loans, particularly over time. So, you know, being very much, as you say, sleeves rolled up, working very much as part of the team to look at the details of each of the transactions and make sure that we understand what we could do to manage those effectively or influence the price at which we'd be prepared to buy those Assets. Assets or indeed what we would want to sell otherwise.

And team wise, I think you had a team of four in London. What were you like as a leader for those guys or what was the team sort of structure?

Yeah, so we had coverage for the European real estate business at ge, a treasurer based in Paris and some guys based in the UK as well, covering the entire European area. Individually, the teams were mostly focused on a particular segment of the portfolio. So country based was how it was structured. So the French treasurer would look after the majority of the French transactions. What we would try to do is give the teams good exposure to all of the activity in those particular country divisions, make sure they had the skills and capabilities to review those transactions and that they could discuss those with the broader team and make sure that they got their input as to what the key issues and risks were, to be able to manage those effectively and advise the business appropriately.

And then from there GE changed quite radically and sort of exited a lot of their change from being a big financial services and GE Capital and changed that to actually be an industrial company now. And obviously that then impacted you guys. Talk us through how you manage that.

Yeah, so I think GE picked up a SIFI designation during the financial crisis. So it proved that it was a significant financial institution in the us. With that came a lot of regul requirements to report and manage the financial services business in a very careful fashion, which became quite burdensome and distracting for GE as a company. And they chose to therefore exit the financial services business, which was a very large financial services business. And so they exited the real estate business amongst many others, and dispersed the assets to new owners and the teams, obviously to the four winds as well. So there's a lot of GE colleagues that are in many, many financial institutions these days, because the business no longer exists in that place.

And then you made a move to Gala Coral. Some people will not know, certainly outside of the uk, they're not going to know. The Gala Coral Group. Maybe explain what that was, if you would.

Yeah. So Gala Coral, a licensed betting office and online gaming and a bingo and betting shop business, which was in private equity ownership, a high leverage structure under that private equity ownership very much focused at that point in its evolution. When I joined on looking at the exits for the private equity firm, whether that would have been an IPO or as it was in the end of trade sale in terms of transaction with.

Ladbrokes, and throughout that period you were obviously doing lots of different activity because by the end of it, had the group sold or what actually happened by the end, when you finished with the role.

So when we finished there, it was agreed in terms of the transaction with Ladbrokes, subject to Competition Authority approval. The Competition Authority approval in that context was a phase two Competition Authority process, which was requiring some remediation, whereby if they had too much density of licensed betting officers within a local market, they would need to sell a number of those assets to somebody else to ensure they didn't have too strong a competitive position within a micro market. So that process is expected to then take a year or so to conclude in terms of the response from the Competition Authority in terms of that process, and then a disposal process to be managed thereafter. So that was likely to be a long period of time and hence a good opportunity at that point to move.

Elsewhere throughout that period, as if you weren't busy enough, you think you were studying your mct, which are the sort of the top level of treasury exams you can do within the UK association of Treasurers, and you were even a prize winner on top of the class. So you've got a family, you got all those demands and some people, oh, I've got to study as well. But you cope with both. Talk us through that, if you would.

Yeah, look, I think there was definitely a big commitment for the mct, but I think it's certainly been worth it in my mind. So when I read the materials that said you were going to spend 10 to 15 hours a week studying for a period of 15 months, I thought, that can't possibly be true, it can't take that much time at all. But they were absolutely right, of course. And thankfully my wife was very supportive and so was able to do that at a more senior point in my career. And actually doing that, having had a lot of experience at that point, was really good because it sort of helped solidify some of the things that I had seen and put a bit more theory around some of those things, and actually was well positioned in anticipation of some of the future things that I've done since then, actually, to think more strategically about the funding of the organization and how to practically think about those funding decisions and how to manage the strategic treasury questions, which a lot are oriented around the funding and financing decisions. In that context, it was a very valuable experience, I thought. Also the content was useful, but also the approach was really useful. And working closely with a cohort of other treasurers, a lot of the material was done online and interactive, giving feedback to each other on our responses to case studies, which is really an interesting way to learn from other people's experience and exposure. But to your original question, you're obviously quite challenging to fit in in the context of a busy job and a busy family life. Thankfully well worth it in the end. I think from my perspective, at the.

Time you were finishing your mct, you weren't busy enough. I actually secured you the role at Renewing. Talk us through that new position and that move.

Yes, I think Renewe was a really interesting move for me. So this was a move from a private equity environment into a PLC environment. A very interesting challenge in that context. Shanks, as was at the time, had a very small treasury function, a very decentralized approach to Treasury, a lot of obligations obviously as a PLC in that context, and some strategic challenges to manage as well. In terms of the market size of the company in total, but also the positioning within the markets, which we were subsequently able to address. In the transaction with you talk about.

How you restructured Treasury. So talk us through the past, present and future. Where have you taken. There was at the time you would join Shanks, but then there was the coming together of the Treasuries. Take us from the Shanks treasury. And what you did, you walked into a Treasury that perhaps needed refreshing. How did you approach that?

Yeah, so, I mean, the treasury function when I joined it was fairly basic, fairly manual, spreadsheet oriented, I think it'd be fair to say, and fairly decentralized. So that was quite different to what we've now created, which is a much more centralized treasury function, which involves a high degree of automation. With the implementation of a Treasury management system, we're taking control over some of the cash responsibilities of the group. We've transformed the funding structure, we've grown the team size, we've improved the capability of the treasury function, which is really enabled us to deliver a lot of high value add opportunities over the last couple of years and make it a much more resilient treasury function than the one I inherited a number of years ago. So in that sense, we've moved the treasury function forward very significantly in that context.

Your ethos around treasury, some people have sort of said, oh, it's all about de risking everything. What's your reason behind Treasury? What's your, you know, your message, if you like?

Yeah, I mean, I think, you know, for me, what's been particularly successful is really trying to focus on how treasury can add value and thinking about that in a very clinical fashion in terms of what the value add opportunities are through different projects and making sure that we spend the limited time that we have on the things that have the maximum value. And to be able to do that, then necessarily trying to reduce the focus of time and effort on the lower value activities and therefore to try to really improve processes where possible, to improve automation, to improve homogeneity and consistency across the group, to make those things that would otherwise distract and take time and effort to deliver, to become less so, to free more time, to be able to deliver the things that very important and add a lot of value. And then I think within that context also, once we have something that we want to deliver, I think it's also a very practical approach to implementation, which is not spending a long time trying to generate something fancy that you hope will work, but trying to get on with it. And I always think of that as a sort of iterative approach where you start something and you start to implement it with the full knowledge that it can be improved over time. But the important step is getting it up and running in the first place and then making sure that the focus remains to continue to implement it rather than waiting for a perfect solution to come along. And I think by doing that we've enabled us to really focus on some very high value items, but also to get a number of projects up and running that would otherwise have died if we had waited for the eventual solution to be perfect.

And you've been with the group three years and you've been through a merger and you've seen teams come together and everything else, what would you say been the, you know, that aside, or maybe part of that, what's been the biggest challenge for you, looking back over the time you've been there, think, well, that was horrible. This is how we got through it, or what was the biggest challenge?

I think we've had a number of different challenges. I think bringing Shanks and Van Ganzwinkel together, major corporate transaction companies of approximately the same size, so sort of a merger of equals in the context of that perspective is quite difficult to bring different organizational cultures across different countries in Europe as well. So that's always represented some challenges and we're still very much in that post merger integration phase at the moment of trying to create their single way of working, the one unified way of being renewing. So that's the ongoing challenge for us that we've been working on quite extensively over the last few years. I think also there's been a number of other challenges along the way, particularly as a result of the acquisition. The leverage is also at a relatively high point at the moment, so we have to manage that carefully and communicate that carefully with our investor base and look to bring that down over time. It's following a trajectory that would be expected given the merger, but it also makes it a more sensitive period from a Treasury perspective. So we need to carry on managing that carefully over time.

What do you like as a boss? What's your ethos around team management and running those treasury guys or helping them?

Yeah, so I think helping them is probably the right description actually. So I like to be supportive to the team and give them a lot of opportunity with a lot of space to be able to deliver projects. So giving them very clear responsibility for specific projects and trying to make sure that they have the space to be able to take ownership for those and deliver those. For example, one of the team at the moment delivering the cash management transformation project that we're working on, which is to centralize all of our cash responsibility, implement a cash pooling approach and implement the treasury management system as a payment gateway for all of our activities and forecasting. So it's a fairly significant project, but they get a good opportunity to run that on a day to day basis and keep me informed and they ask me for my input where they think it'd be valuable. And that works very well, I think, in terms of giving them the opportunities to grow and the space to grow and feedback along the way to make it successful.

Are they all based in the UK or.

No? We've got the team split between the UK and the Netherlands as well, which is sort of typical for the entire renewee business. The majority of our business is based in the Netherlands and Belgium. About 90% of the operations are there. So unsurprisingly, we have a presence in the Netherlands and Belgium as well for most of our functional activities.

So how do you manage those guys remotely? Is it one want a quick call on the phone every week? How do you manage those guys when they're X amount of miles away from you?

I think it's important to be present with the team on a regular basis. We've got one of our colleagues over here today, for example, from Eindhoven, but personally I'm probably in the Netherlands and Belgium most weeks to make sure that I spend time with the team, but also the broader network of people that we work with internally and externally, the banks, but also our colleagues within the renewing business. It's really important to get as close as possible from my perspective to the business, to understand what's going on to the advisors, to the lenders, to understand their issues and concerns and to Develop a strong relationship with each of them to be able to be effective for all the things that we're trying to do. So there's a lot of effort goes into maintaining those relationships. There's a fair few air miles generated, even though it's only a short hop over to the Netherlands.

Yeah, but face to face actually helps as well. And when you're in that recruitment phase, what is it you're looking for? I mean, looking at your background, you've got this great history, you know, A levels, great degree, then, you know, qualified accountant, treasury exams. Actually, I want someone just like that. Or what's your ethos around recruitment? When you're looking at someone and you're Sifting through resumes, CVs, what are you looking for? What's the standout factor for you?

Yeah, I mean, I think for me diversity is really important. So a carbon copy of myself is not going to be a good team mix at all. So rarely do I look to recruit in my own mold and if I get biased towards that direction, I normally come back from it quite quickly, actually. But that said, I think there's components that are relevant. I think having appropriate qualifications for the role that you're doing, whilst it doesn't necessarily help you to do the day job, it also does show that you have a commitment to continuous education and to learning and to trying new things and to. To learn from those experiences, which I think is an important characteristic. So that's certainly important. And then I think there's obviously different roles within treasury that require different sorts of skills. So making sure that the people that we're hiring have the right sort of skill set for the role that we want, and sometimes that's going to be a very detail oriented and routine processing activity, and sometimes that's going to be a more expansive role where people can run out big projects and make them their own and deliver them. So very much a sort of horses for courses approach to recruitment and making sure that we get the right people for the right situation and then making sure that the candidates fit well within the organizational context as well. So making sure that they're going to be somebody who can communicate effectively, particularly with the rest of the business, is very important, particularly in the small team teams that we have. So to understand the business, to be able to communicate treasury and to be able to understand what's going on in the business and reflect on that and how we manage the treasury function, some of the important skills, from my perspective.

And when you look to those people that are able to communicate what's been the standout factor for you or how have you assessed that when you've interviewed them or spoken to them or spoken to them throughout the process? What's been the. Oh actually that's the person we want. How have you assess that, as it were?

I think an important part of the assessment is the treasury function is very capable of assessing the treasury capability requirements and in some ways whether you can communicate with somebody outside of treasury is a very important test and therefore an important part of the recruitment process from my perspective. So meeting with the broader finance team, whether that's within the controlling team or FP and a or elsewhere, to be able to have a conversation with those team members particularly and not get lost in treasury detail as some people can, and be able to come across well to those people and therefore be people that the broader team can work with effectively on a day to day basis is one of the key things that we were able to do here.

And have you ever struggled to find those people or what's been the, what have been the challenges for you?

I think one of the recruitment challenges for us is just an out of town location, whether they're in the UK or in the Netherlands. So that influences the candidate pools quite significantly. Certainly in my past when I've been recruiting in London, it's been a broader slate of candidates and therefore better able to do that. I think one of the key differentiators for renewal in that context is the purpose of the company is such a positive purpose that it's a very attractive company to work for in terms of what it does and the contribution to society that comes from that, the contribution to the environment that comes from that. And we certainly emphasize that. We've emphasized that through our funding structure and making it into a green financing as a visible way of describing that. But also it does translate through to how passionate people feel within the organization about the value of what we're doing for our customers, which is otherwise not necessarily very glamorous.

And you've been in treasury now 20 years. How have you seen it change?

It's difficult to comment. I think I've worked in lots of different treasury functions and lots of different capital structures and in different industries. So it's not been a linear path for me in that context. I haven't grown up in a Treasury function in the same way as some of the other people that you may have interviewed have, but I think certainly in the current context looking process improvement, but the use of systems and automation within that context is a valuable part of what we're doing at the moment. But some of the skills in treasury are timeless. They don't change in terms of looking at the capital structure and managing the cash flows carefully and projecting that as best you can, and managing the relationships with the banking group or developing relationships with the advisors, the lawyers, the corporate finance advisors, the risk management advisors, et cetera, I think are fairly tight, timeless and unchanging. And it's perhaps just a little bit more in terms of the sophistication of how we do that and progressively making each of the treasury functions that we work in progressively more sophisticated over time and more efficient over time as well.

Yeah, I think. Well, certainly from the conversations I've had, you talk about derived value there, maybe of what a treasurer does. I've sometimes felt on a couple of the shows that people have said, well, we're going to be replaced by robots or, you know, everything. Technology is taking over and streamlining the jobs and we'll be streamlined out of a job. But actually, as you say, it's about much more than that. And that's certainly what I found from talking to treasurers like yourself for the past 20 years, that actually you're not just, you know, guys that switch on the PC and feed in the data and out comes the results. Thanks very much. It's all about, yes, there's a part of that, but actually it's about all the other stuff, stuff you do, all the relationship and all the other things that you actually add value on as well. And you see that, you know, there's a lot of. Go on.

I think that's right. There's also a lot of interpretation of information is not just the generation of information. So the systems and automation help generate some information in a better, cleaner fashion, which becomes more actionable, more intuitive to use and more reliable. But absent that, actually the treasurer skills are even more in demand, which is to try to make sense when some of the indicators are not as clear as you would like them to be. But we've been implementing some robotization in our shared service center, and I really like the description that our shared service center leader uses, which he thinks of the robots as employees, that they have sick days, that they go wrong occasionally, they need care and maintenance in the same way an employee does. So I don't think it's a utopian answer that automation will be able to survive without the input of experienced users, to manage and control, to configure, to make them work properly and to fix them when they go wrong as well. So I think there's still a huge role to do even when you are on a process of automation as well.

Yeah, all humans aren't redundant quite yet. No, I think we'll still be. As we approach the end of today's show, we spoke before and I was going to say to people, people that Adam said again that it's okay to connect with him via LinkedIn and Things, but when you're looking at Adam's LinkedIn profile, you might look at it actually that I'd like to sort of have a similar career journey or, you know, I like bits of it and things like that. If you look back over your career and someone says, actually I want to mimic that or I want to sort of follow a similar career path, what advice would you give someone? As sort of the closing bit today, someone comes to you say, oh, how did you do it, Adam? Or I want to do this. What would you say to those guys?

I've been very lucky to have a lot of varied experience over my time, both in terms of the organizations that I've worked in, from large US companies to privately owned companies to publicly owned companies to highly leveraged to low leverage companies. And that adds that richness to your background and experience. So if you can achieve that, I think that's very helpful. And I think also the complement of working on your experience in the job, in addition to working on developing your experience through technical qualifications, for example, the MCT that we mentioned earlier, I think is very valuable as well. But also in parallel to each of those components, it's also important to focus on the individual skills as well that are required to be effective within an organization. The typical sort of professional development skills that enable you to be more successful in delivering the solutions that you want to. So I think working on all of those things in parallel throughout your career is a very valuable aspect and something that I continue to focus on today.

So work in a breadth of companies, develop your technical qualifications and at the same time get your interpersonals going well as well, and then you get to be the treasurer of a renewal.

That's it. As easy as that.

Fantastic. Adam, thank you very much for today's show. What we'll do is I say we'll put Adam's LinkedIn profile in the show notes, feel free to connect with him if he feels relevant and things like that, and look forward to the future growth of the company and keep on developing, renewing and doing some good for the world.

Thank you.

Thanks very much.