My Life in Treasury

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My Life in Treasury: Royston Da Costa, Wolseley Royston, who has built up many years of treasury experience with international businesses, discusses his career thus far with Helen Sanders, Editor, and offers his advice to finance professionals in the early stages of a treasury career.

My Life in Treasury

Royston Da Costa

An Interview with Royston Da Costa, Group Assistant Treasurer, Treasury Systems & Development, Wolseley Group Services

Royston Da Costa, who has built up many years of treasury experience with international businesses, recently published a very well-received article in TMI on the treasury technology transformation in which Wolseley has been engaged, updating readers on progress since his previous article in 2013. In this edition, Royston discusses his career and experiences in treasury with Helen Sanders, Editor.

How did you come into treasury and what attracted you to the profession?

Like many people, I really ‘stumbled’ into treasury, having previously been employed in merchant banking. My first treasury role was as a Treasury Analyst with BSB (British Satellite Broadcasting) in 1989, although the company then merged with Sky in 1990 to become BSkyB, the UK’s biggest digital subscription-based television company, and subsequently Sky plc in 2014. Although my time with BSB was relatively brief, I was involved in a range of activities such as using Forward Rate Agreements (FRAs) as part of the hedging programme, payments, bank mandates and bank relationships. It was very useful to have both banking and corporate experience to be able to see both perspectives. In addition, I enjoyed the interactions I had with other departments within the business, and with the board, which were features of treasury not often shared by junior employees of other departments in the company.

How did your career progress through to the role that you hold today?

When I left BSB, I was still not necessarily thinking of a long-term career in treasury, but I was offered a role at Gillette, where I spent the next two years. Gillette’s treasury was based in the UK, but was a global business, with activities across all regions, which brought a variety of opportunities and challenges, and it was rewarding to be able to build relationships across regions and timezones. In 1993, I joined Polygram, which was owned by Philips at that time, before being acquired by Seagram in 1999 to become Universal Music Group or UMG. This was a very interesting time, not least due to the challenges of merging two treasury functions of quite diverse businesses with very different cultures. At Polygram, we operated an intercompany netting system, with 97 netting participants from 24 countries communicating by fax, generating savings of $3m per year. Seagram also operated an intercompany netting process through an external bank as well as a $30bn hedging programme I was responsible as the Treasury Operations Manager for executing. I also co-ordinated nine debt pushdown structures to increase tax efficiency on payment of interest on $10bn debt. When Vivendi acquired Seagram, treasury was taken over by the Paris-based group treasury function, but I remained as part of the handover for the next few months to outsource both predecessor companies’ netting process to ABN Amro in Dublin. Thereafter, I moved to Wolseley where I joined as Group Assistant Treasurer and have remained ever since.

Wolseley was a very different company once again, with a strong focus on cash management, and more of a European/North American than a global footprint. It is also more decentralised than my previous companies, although this has changed to some degree. For the first eight years, I was responsible for treasury operations, but latterly took responsibility for treasury technology. This has proved a culmination of my previous experiences, as I can look across the activities for which treasury is responsible and seek ways to improve automation, control and decision-making.

How have demands and needs in terms of treasury changed over the course of your career, and what particular skills does it now require?

Treasury has changed, and continues to change dramatically, not least due to the changing role of technology. This is not only the use of treasury management systems, but also the way in which we communicate with internal and external contacts. When I started my career, most interactions with banks and other departments within the company were by telephone, rather than using online dealing, webex and all the other options that now exist. What has been very clear to me throughout my career, despite the opportunities for digital communications, is the importance of meeting in person and building relationships directly to build trust and confidence. This is not always possible, of course, particularly for multinational businesses, but new forms of communication should enhance, not replace, good relationships. Online dealing, for example, is very valuable for high volume transactions, but maintaining a close relationship with your banks to understand what is happening in the markets is also very important.

Another feature of treasury is its constant change and development. During my career, I have helped the companies I have worked for deal with the introduction of the euro, navigate the impact of the global financial crisis, and most recently, market developments such as SEPA. This change process is ongoing, as with regulations such as Basel III now taking effect, and emerging challenges such as cyber security, treasury challenges continue to evolve. In this environment, with external threats becoming ever more sophisticated, the right processes and technology have never been more important.

What is your greatest professional achievement to date and why?

It’s difficult to identify a single incident as my career has been quite diverse. One memorable day during my early career at Polygram was being the only person left in the office after hours, but the need arose to pay a production studio in the United States to secure a vital contract. It was a US holiday, Martin Luther King day, so I could not arrange for an electronic transfer, so I had to think on my feet. I managed to arrange for our Canadian subsidiary to remit the funds to Western Union in Toronto (equivalent to Thomas Cook), who instructed their New York branch to issue a cheque to the producer, finally securing the contract at 4 a.m. in the UK. Although the value was not large, it was crucial for our business, and required some lateral thinking. There have of course, been more sizeable events since then, such as converting £800m proceeds from a rights issue to repay US dollar and euro debt in October 2008 at the height of the crisis. Market confidence was at rock bottom, and few dealers wanted to quote spot prices beyond $20m or so.

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