- Gavin Jones
- EMEA Treasurer, Avon Cosmetics Limited
An Interview with Gavin Jones, EMEA Treasurer, Avon Cosmetics Limited
This month, Helen Sanders, Editor, talks to Gavin Jones who recently joined global beauty company Avon after nearly a decade with Royal Ahold NV. Gavin was a winner of the TMI Award for Excellence and Innovation in Cash Investment in the 2013 Awards.
How did you first get into treasury, and what attracted you to the profession?
My introduction to treasury was partly accidental, partly deliberate. Having studied business studies at university, I was working in finance for a glass manufacturer, Solaglas (now Glassolutions, part of the Saint-Gobain Group). This included monitoring budgets and accounting for machinery sourcing from Europe, particularly Italy. To do this, we needed to translate the ITL value into GBP, which was based on information provided by group treasury. I found my interactions with treasury interesting, so while I finished my degree on a part-time basis, I took a module in treasury management. From the first lecture, which was on the subject of interest rate swaps, I knew that this was an area of finance in which I wanted to be involved.
At around the same time, an opportunity arose at Volvo Trucks in the UK in a subsidiary treasury function. As Scandinavian businesses have a reputation for leading the field in treasury management, this was a great opportunity to develop my skills and knowledge of best-in-class treasury techniques at the start of my treasury career.
How did your career progress to the role you hold now at Avon?
I spent three years at Volvo, which involved a wide range of treasury activities, such as cash pooling, managing FX exposures and implementing electronic banking systems, which were far less prevalent in the early 90s. I was also very fortunate to have an excellent manager who was very supportive in helping me to develop my treasury career, which included studying for the Association of Corporate Treasurers’ (ACT) exams.
After three years, I realised that there was a limit to what I could achieve in a subsidiary treasury function, so I made the decision to seek a group treasury role. In 1998, I moved to Tesco plc, where I stayed for the next seven years. Initially, I worked as a dealer, then front office manager, and finally, European treasurer. This was an amazing period to work for Tesco, with the expansion into Asia Pacific, the introduction of non-food product lines and the launch of Tesco’s financial services division. There was also a great team in treasury over that time, and we still keep in touch.
By that time, my wife and I were contemplating taking a career break and spending some time overseas, which we had never had the opportunity to do. We had thought of travelling for a year, but while we were planning it, I was approached by a head hunter for a role at Royal Ahold, based in Geneva. I knew the company, including the financial challenges it had experienced in 2003, and recognised it was an opportunity to be involved in a ‘turnaround’ treasury department, and introduce greater centralisation, financial and operational efficiency. We decided to make the move to Geneva, initially with the intention to stay for a couple of years, but ultimately remained there for nine and a half years, and our daughter, who is now four, was born there. The vast majority of that time was with Ahold, split into two tranches. In between, I worked for Japan Tobacco International which gave me a useful experience of working in a truly global business.
Last year, although working for Ahold had been a great experience working alongside a really professional team, we decided that if the right opportunity came up, we would come back to the UK to be nearer our families. I was approached by a former manager to initially find out my thoughts on how Avon could develop a regional treasury function. I came to the UK, talked to the EMEA finance team and global treasurer, enjoyed the discussion and subsequently was then invited to join the company to implement those ideas. Joining Avon was an attractive proposition, as it was a brand new role enabling me to be part of building a regional treasury structure from the bottom up. At the same time, it provides an opportunity to find new ways to support a unique business that economically empowers women across the globe through more than six million independent representatives.
It’s a big decision to relocate overseas, but given the international nature of treasury, it is a growing trend. What advice would you give based on your experience?
An overseas move needs to be considered carefully, particularly the impact on the family, and the career of the trailing partner. It is important to think about whether you will able to integrate into a new environment, particularly in a foreign language. We benefited from the large expatriate community in Geneva, and we were fortunate that we both spoke some French. Despite the difficulties, however, it is definitely an experience I would recommend. Working for an overseas business is quite different to working in your home market, and Ahold’s and JTI’s treasuries comprised a wide variety of nationalities and cultural backgrounds. As a manager too, managing a multinational, multicultural team can be challenging, but also very rewarding.[[[PAGE]]]
How do you think demands on treasurers have changed during your career so far, and what additional skills are required to meet these demands?
The global credit crisis was a game-changer for treasury, as company boards recognised the critical role that treasury plays in managing group liquidity and risk. As financing channels for many companies, particularly small and medium-sized enterprises, dried up, CFOs and boards realised that generating and accessing cash internally is the most secure and cost-effective form of liquidity, and reduces reliance on external funding. As a result, treasury is now a high-profile business function, though I have been fortunate that the organisations I have worked in have always valued the activities that treasury performs. Today, however, treasurers tend to find it easier to open doors in the rest of the business than they have done in the past.
In this environment, a key skill is to be able to communicate technical treasury topics in a way that is clear to stakeholders without a treasury and finance background, but without being patronising. Related to this, treasurers need strong presentation skills and the ability to write reports and memos well. These are not skills that are covered as part of a traditional treasury or finance course, but are as important as technical skills.
Technology has also been a significant enabler in treasury. In particular, treasurers need to consider how they can use technology to improve efficiency and free up resources to undertake tasks that add greater value to the organisation, and spend more time in the wider business. This is an ongoing challenge as the range and complexity of treasury responsibility grows, while headcount typically remains the same.
Regulatory changes, such as EMIR reporting and the liquidity coverage ratio (LCR) under Basel III have a considerable impact on treasury, including those such as the LCR where the impact is indirect. For example, LCR will have a major impact on banks’ appetite for operating over non-operating cash, and the pricing that will be available. This compounds the challenges of a low interest rate environment that treasurers with surplus cash are experiencing.
What has been your greatest professional achievement so far, and why?
I have been very proud of the teams I’ve worked with throughout my treasury career, and have learnt as much from them as I hope I have also contributed. If I had to pick out a single achievement, it would probably be translating my ACT MCT dissertation on bank relationship management into practice whilst I was at Ahold. Our banks were very appreciative of the approach we took, and there were also considerable benefits to Ahold. At some point in the future I hope to introduce the concept into Avon.
What attributes do you look for when employing people into your department?
From my experience, there are some differences depending on the country, as well as the type of department, into which you are recruiting. In the UK, for example, I would expect a potential recruit to pursue ACT qualifications. In Europe, the wider academic background is more important. In more senior roles, you are more likely to take the technical skills as a given, and focus more on strategic thinking. To do this, we have often used case studies as part of the interview process and asked candidates to do a presentation or write a report, which has often given some interesting results. In particular, not everyone with the right technical skills has the right interpersonal or presentation skills that treasurers need to demonstrate.
Of equal importance is personality and cultural fit: it doesn’t matter how technically competent a person is if they will not work well with the team. This is particularly the case when replacing someone very strong, for whom the rest of the team had a lot of respect.
An effective mentoring programme can be instrumental in helping treasury professionals to develop the wide range of skills that are required. I have benefited a great deal from mentors throughout my career so far, and it is very important to keep an open mind to feedback and new ideas.
How important do you think a formal treasury education is, as opposed to (or as well as) more general finance qualifications?
In the UK, formal qualifications through the ACT are more prevalent, and these are often critical requirements for many UK employers. Formal qualifications give a good technical foundation, particularly to cover areas that are not part of a treasury professional’s day-to-day responsibilities, and to facilitate a move into a new role or employer, so I have encouraged my team to pursue them. In Europe, when I first moved there only a few treasury professionals had a formal treasury education, although this is changing as the ACT adapts its qualifications to a more international student base, and other certificates and university courses emerge. Even without formal treasury qualifications, however, treasury professionals often have a very strong academic background in accounting, finance, business studies and MBA qualifications, and have developed specific technical experience relating to treasury on the job, and this combination can be just as compelling.
Despite the importance of a strong technical foundation, however gained, practical experience and the softer skills I mentioned earlier are equally valuable, and there are people with a strong academic background in treasury that lack this practical experience and set of skills. My career has certainly been helped by ensuring a good balance between qualification and practical experience.
Based on your career so far, what would your advice be to finance professionals who are perhaps in their first treasury role?
Whenever joining a new team, at whatever level, listen and learn how things are done. Only then can you make suggestions on ways to improve. Don’t be afraid to ask questions, both of other treasury team members, and of the wider business. Similarly ask your banks when you don’t have complete information or you don’t understand something. If you can, spend some time in the business: at Avon, for example, this can mean spending time with an Avon representative to find out what opportunities, challenges and difficulties they are experiencing, and what the difference could be if these could be addressed. In another business, it could involve sitting with sales or purchasing or other parts of the business that participate in the financial supply chain and contribute to working capital.
Every experience you have is useful, whether or not this has been gained in treasury. Indeed, skills and experience from other parts of a business can provide a new insight to how treasury can contribute to the organisation. After all, treasury’s focus should be on supporting the business.[[[PAGE]]]
What would your ideal holiday be?
I’m not a great lover of sand or heat, which is probably why living in Switzerland has suited me for the past decade. Living so close to the Alps has meant a 45-minute drive to the nearest ski resort, so our ideal holiday would be two weeks skiing after a huge snowfall followed by unbroken blue skies. Now we are back in the UK, we are looking forward to exploring, such as the west coast of Scotland, which is spectacular when the weather is kind.
What book have you read, or film have you seen recently that you would recommend, and why?
As a father whose daughter is at the age where she likes to read a story every day, I have to recommend The Day the Crayons Quit by Drew Daywalt, which is very funny for children, but just as much fun for adults. When I’m not reading to my daughter, I really enjoy historical fiction, particularly around Roman military history, and I have particularly enjoyed Anthony Riches’ ‘Empire’ series that mixes fact and fiction in following the journey of a Roman centurion.
The best film I have seen lately is Interstellar which combined an amazing story with great photography: really a movie to make you think.
