CFO Magazine 2018 - 2nd Issue by CFO South Africa

MAGAZINE FOR FINANCE PROFESSIONALS IN SOUTH AFRICA 2 • 2018 CFO.CO.ZA

Thobeka Ntshiza The problem with your risk register... Lucas Verwey Group FD Distell Rolling up your sleeves Till Streichert Group CFO Vodacom Lessons from the Cape Epic

Rethinking internal audit Deloitte’s Rushdi Solomons Benchmark for success The rise-and-rise of the CFO Awards

Charl Keyter CFO Sibanye-Stillwater The value of saving energy

CA(SA) NOT THE ONLY WAY

CFO career paths off the beaten track

CFO Black Umbrellas

Nyasha Madavo

FINANCE by day, FASHION by night

TABLE OF CONTENTS Lucas Verwey

Rushdi Solomons

Logic, simplicity and a focus on what they do well. That is what Lucas Verwey feels he has brought to Distell since he joined them from Investment Holding company, Remgro. “This job is much more hands-on. It is about rolling up your sleeves and empowering the team.”

Rushdi Solomons is a partner who heads up internal audit services for Deloitte Africa. Internal Audit is a function that he believes can add immense value beyond the “tick box” reputation that perhaps still persists.

40 Nyasha Madavo

CFO South Africa is the organisation for finance executives in South Africa. Our goal is to connect finance professionals online and off in order to share knowledge, exchange interests and open up business opportunities. CFO Enterprises (Pty) Ltd 1 Wedgewood Link, Bryanston, Johannesburg, 2191, South Africa. | +27 (0)11 083 7515 | CFO.co.za © 2018 CFO Enterprises (Pty) Ltd. All rights reserved. No part of this publication may be reproduced, distributed or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission of the publisher, except in the case of brief quotations embodied in critical reviews and certain other noncommercial uses permitted by copyright law. MANAGING DIRECTOR

EDITOR IN CHIEF Joël Roerig jroerig@cfo.co.za +27 (0)76 371 2856

DESIGN

Graham Fehrsen gfehrsen@cfo.co.za +27 (0)79 898 0227 COMMUNITY MANAGER

SENIOR EDITORS

Patrick Furter, Maritz Verwey, Sportograf.com

Liezl Berry lberry@cfo.co.za +27 (0)76 813 1096

Toni Muir tmuir@cfo.co.za +27 (0)82 908 8687

OTHER CONTRIBUTORS

HEAD OF SALES

Georgina Guedes gguedes@cfo.co.za +27 (0)83 651 2789

Ashik Ramkelawan aramkelawan@cfo.co.za +27 (0)82 570 9482

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Kate Ferreira kferreira@cfo.co.za +27 (0)82 8686083

Elizabeth Ferraris PHOTOGRAPHY

Chana Boucher, Dianne Tipping-Woods, Judith Kamffer, Sarah Chalmers PRINTING Novus Holdings coenraad.pretorius@novus.holdings +27 (0)11 201 3460

Community 12 New CFO appointments 16 Epic Till: Vodacom CFO excels at Cape Epic 20 CFO Awards: benchmark for success

Growth

32 Megan Jarvis: how to strike the perfect deal 36 Tshego Sefolo: CFO key to PE

Excellence 46 CFO Summit: call for visible leadership 48 Billy bank recon: Warren Prinsloo 52 Bongani Manzi: humble beginnings, great ambition

Risk 56 Thobeka Ntshiza: The problem

with your risk register... 62 10 questions for PenBev’s Andrew McMaster 68 CFOs discuss risk and reputation

Accounting 73 CFOs get energy-savvy 75 Energy-saving tips: SibanyeStillwater CFO Charl Keyter 76 CA(SA)? NOT the only way

And further 6 From the Editor in Chief:

extramural activities 8 Finance Indaba Africa 2018 11 From the MD: robust and honest CFO MAGAZINE • CFO.CO.ZA

FROM THE EDITOR IN CHIEF

Extramural activities

ll evidence currently available suggests that CFOs are people too. You also have children, husbands and wives and you also have cars that need to be serviced and leaks that need repairing. Plenty of you also do exciting stuff outside of the office, ranging from jumping out of airplanes with a parachute and playing guitar in a band to scaling mountains, gathering collectables and touring the continent on a motorbike. When we were chatting to cover CFO Nyasha Madavo (Black Umbrellas, page 40) about her fashion house and to CFO of the Year 2017 Till Streichert (Vodacom, page 16) about his Cape Epic adventures, I did allow myself to wonder how on earth they combine these impressive exploits with excelling in their roles as finance leaders. The answer, of course, is that these two and many others are top CFOs because of, and not in spite of, their extramural activities.

Would Till have had the tenacity, endurance and guts needed to correct a failing ERP implementation and transform Vodacom’s finance function without the lessons learnt running and cycling? Would Nyasha have had the same insights into cash flow, risk and entrepreneurship without answering her fashion calling? This magazine includes some fantastic insights from real people – and real CFOs – like Lucas Verwey (Distell, page 36), Warren Prinsloo (Jasco, page 48), Bongani Manzi (Westfalia Fruit, page 52) and Andrew McMaster (PenBev, page 62). The contributions by finance leaders Thobeka Ntshiza about risk registers (page 56) and Sibanye-Stillwater’s Charl Keyter about energy efficiency (page 73) are also particularly pressing.

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With insights about deal making (page 32), private equity (page 36) and internal audit (page 70) also included, this issue of CFO Magazine once again promises to be one to read and reread. Two of the most informative features deal with people too: CFOs that have chosen a different route than CA(SA) (page 76) and three members of the CFO Awards panel of judges who have been involved in all five editions to date (page 20). Joël Roerig jroerig@cfo.co.za +27 (0)76 371 2856

FINANCE INDABA AFRICA

9 REASONS TO REGISTER TODAY 1. Meet thousands of your peers from different industries 2. Learn about the latest in analytics and automation 3. Hear about the personal experiences of leading South African CFOs 4. Engage with thought leaders and FinTech entrepreneurs 5. Hear from female leaders shattering the glass ceiling 6. Tips on exercising corporate governance and due diligence 7. Personal lessons from international finance leaders 8. Advice on balancing work and life 9. Hear from your public sector servants on how they are building a better future

Finance professionals flock to the Sandton Convention Centre on 3 and 4 October 2018

Smashing all records Finance Indaba Africa 2018 is going to be bigger and better. The biggest finance conference in Africa is expected to smash records in terms of numbers of attendees, exhibitors, international speakers and business opportunities.

n 3 and 4 October 2018, over 5,000 finance professionals will gather to learn, share knowledge and network. Many of this year’s exhibitors have already renewed their commitments and other companies – who realise they

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missed out in 2017 – will be joining the exhibition. “Finance Indaba understands that Finance is more than just numbers,” commented attendee Cheryl Howell, finance manager at the CSIR, after last year’s event. “It’s

about connecting people, ideas and information to add value and improve the numbers.” Unathi Mlisa, management accountant MTN Group, also lauded the value of the two days. “The entertainment was out of this world, the presenters were of very high cali-

5 THINGS YOU NEED TO KNOW 1. 3 & 4 October 2018 at the Sandton Convention Centre 2. Free of charge for finance professionals 3. Twitter hashtag #findaba18 4. Finance-indaba.co.za to exhibit or register 5. Email Sarah Chalmers at schalmers@cfo.co.za for team registrations

bre and the energy from everyone electric. Can’t wait for 2018!” Financial accounting director Charlotte Makaringe, who works at the public works department of Limpopo province, called the event inspirational. “I will never miss it. I attended last year and always come back ready to take on the world.” Shaun Carter, part-time FD at CFS Recruitment ‘complained’ about “information overload”, but called the event “a great onestop-shop to find service providers in the industry”. V-Switch director Hannes Venter echoed that sentiment: “I met a lot of people and was introduced to new solutions and services for our business growth in the future." CFOs and other top executives have realised that giving their team two

days off is the best (free) investment they can make in the success of their businesses. “It is fascinating to have an event of this size and magnitude with content of exceptional quality. The Finance Indaba is something that is needed for our profession in this country,” said JSE Limited CFO Aarti Takoordeen after last year’s event, with SAICA’s Kelly Masete, Project Director: Members in Business, echoing her assessment: “The Finance Indaba is a brilliant platform for people to network, interact and share knowledge and information.” Finance Indaba Africa is the only annual event on the continent where thousands of registered accountants and other finance professionals gather under one roof for two days to advance their

knowledge, networks and careers during learning sessions, presentations and networking. CAs and members of other professional bodies also qualify for up to 14 CPD hours, but that is small change compared to the massive boost the event gives to the work finance teams produce. Planning for the 2018 event on 3 and 4 October is well underway, with a number of top-quality speakers soon to be revealed, alongside a string of partners and exhibitors that will be announced over the course of the next few months. Standard Bank will once again feature as diamond partner at the Finance Indaba Africa, while other confirmed exhibitors include CIMA, ACCA, Purple Group, AdvanceNet, 4Most, 360T and This Is Me. l

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FROM THE MD

Robust and honest The world of finance has moved at light speed in the six short years CFO South Africa has been helping finance executives learn and network. The roles CFOs and FDs occupy are morphing at an alarming rate and we’ve been asking questions and sharing experiences in ways that I firmly believe have been good for the finance and accounting profession. What does it mean, in 2018, to do the right thing? The multitude of answers to this question are on display almost every day in corporate South Africa. Unfortunately, more recently, we’ve seen a significant number of examples of what the wrong thing to do is. And most of us have watched in fascination and disbelief as people took very little accountability when the right things weren’t done.

Sneha Shah, Mteto Nyati, Andrew Darfoor, Phil Wilmington, Peter Mountford, Piet Mouton, Lee Naik and Ian Russel – just a few of the exceptional business leaders who will participate in this conversation and, combined with an exquisite dining experience, help shape the insights, efforts and commitment of finance leaders. Whatever your answer to the question on what it means to do the right thing, I hope you’ll take time to join your peers, make new contacts and help us continue the work of building a finance and accounting community that is robust, honest and willing to ask the most important questions of the time. Graham Fehrsen

With all that’s going on around us we’ve tried to stay true to the learning, network and career pillars on which our business has been built. Hosted for the first time on Constitution Hill, the CFO Awards on 10 May will offer finance leaders the chance to reflect, learn and network in an environment that genuinely challenges their perspective on doing the right thing. An hour before the awards ceremony, CFOs will walk 50 metres into the courtyard of the old men’s prison facility and tackle the topic “Social Justice and Corporate Responsibility” at our unique Masterclass. Perhaps as importantly though, we will celebrate financial excellence with the very best finance professionals.

gfehrsen@cfo.co.za +27 (0)79 898 0227

CFO Day on 17 July creates a first of its kind event where we ask CEOs and other extraordinary business leaders to share their perspectives and help finance leaders see new horizons.Inspired by the resilience and endless belief that most South Africans have in a better future, CFO Day will be one to remember.

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COMMUNITY New CFOs for Bidvest, Shoprite, Liberty, Spur and Altron

ON THE MOVE A significant number of prominent South African companies appointed new finance leaders in the past few months – and two top CFOs retired.

Anton de Bruyn

ongtime Shoprite Holdings CFO Marius Bosman will be retiring from his role at the start of July 2018. Marius has been with the retailer for 25 years and will be staying on as a consultant. Anton de Bruyn, a qualified CA, will be taking over the role. Anton has been a Shoprite employee for 15 years and was most recently the group's deputy General Manager Group Finance. Following Peter Meijer’s retirement as Bidvest Group CFO, after a 28-year tenure with the company, Mark Steyn took over the role, effective 1 March 2018. Mark, who first joined Bidvest in 1997 and has held various financial positions within Bidvest over the years, was CFO of Bidvest Freight until this promotion.

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Liberty Holdings appointed Yuresh Maharaj as Group FD, replacing Casper Troskie, who moved to Old Mutual Emerging Markets. In September 2015, Yuresh was appointed Executive Head of Finance at Liberty Holdings. Prior to this, he was a partner at Deloitte within the insurance and actuarial practice – a post he held for nine years. He qualified as a CA(SA) in 2001. “His appointment underscores the depth and quality of people within our management structures,” said David Munro, Chief Executive of Liberty. Phillip Matthee, who qualified as a CA(SA) in 2002, took over the role of Spur FD from Ronel van Dijk, who has resigned and is enjoying a sabbatical. Ronel first joined the company as group FM in January 2003, and was promoted to CFO in

Mark Steyn

Yuresh Maharaj

January 2005. Since 1 April, Phillip has held the finance reins for the Spur Corporation, which he first joined in 2007 as group finance executive, having until then served as group accountant at Clicks Group. “Ronel was a great personal role model and mentor, who will be missed. I learnt a tremendous amount from her and she leaves behind big shoes to fill,” Phillip said. MultiChoice Africa CEO Tim Jacobs stepped away from the chief executive desk to instead take up the acting Group CFO role at JSE-listed Allied Electronics Corporation Limited (Altron), effective 1 March 2018. The role was previously held by Alex Smith, who moved to Net1 UEPS Technologies. “With over 20 years of commercial experience, coupled with his experience in

Rivasha Maharaj now Afgri CFO Following Johan Geel’s move to GWK, Rivasha Maharaj took over the role as Afgri CFO, effective 1 February 2018. Prior to this, she was director of Nampak DivFood Botswana, before which she was divisional finance director of DivFood, a division of Nampak. Rivasha shared her plans for her new role as CFO of Afgri. What do you most look forward to in this role? “I am excited about being a part of the evolution of the business. I am most looking forward to being instrumental in shaping the journey and being an enabler to the business to achieve the goals set.” What is on your radar to achieve in the first few months? “On my radar is to ensure the business has the necessary capabilities and capacity with regard to skills, people and technology. The business is transforming, and we need to be adequately equipped to meet the new requirements.” What do you think the coming year will hold for you and the team? “The coming 18 months will be a very exciting time and the team will be challenged with the changes experienced on this journey. It is our responsibility to facilitate the transformation within the group and to provide guidance.”

Previously the CFO of the National Credit Regulator (NCR), Ayanda Mafuleka was appointed CFO of state coal mining company, African Exploration, Mining and Finance Corporation (AEMFC), effective 1 February 2018.

Phill Matthee

Africa, Tim will add value to our growth agenda,” said Mteto Nyati, Altron Group Chief Executive. JSE- and TSX-listed Atlatsa Resources appointed Shireen Stow as interim CFO, succeeding Reinhardt van Wyk in the role. Shireen, a CA(SA) with 15 years of experience, has worked in various financial and auditing roles in South Africa and the United States. She worked for Atlatsa for three years in the finance department before taking on this new executive role on 1 February 2018, albeit in an interim capacity.

Several executives left the realm of finance for other senior positions. Anthony Thunström moved from the role of CFO of The Foschini Group (TFG) to CEO, taking over from outgoing CEO Doug Murray, who retired. Anthony, a CA, has been the company’s CFO since February 2015. Prior to this he was the COO of KPMG Global Africa Practice, as well as Regional Leader KZN. TFG is currently recruiting for a new CFO. Mary Vilakazi, who was nominated for the 2017 CFO of the Year Awards, has made a few executive moves recently, the latest being her appointment as group COO and executive director of FirstRand, effective 1 July 2018. Prior to this, Mary was appointed deputy CEO of MMI, a promotion from her role as MMI CFO.

According to Laurie Dippenaar, FirstRand chairman, Mary’s appointment as group COO adds significant strategic and operational capacity at an executive management level. “Expanding the insurance profit pools in FirstRand’s domestic business is one of the most significant levers for future growth and shareholder value creation, and the board is excited to have someone of Mary’s calibre driving that strategy.” Werner Engelbrecht swopped the role of CFO of Kyocera for the interim General Manager role, replacing Wayne Holborn, who resigned after two decades with the company. Werner, who first started at the company 12 years ago as Senior Manager: Shared Services, has been CFO since 2014. He took over the GM role from 1 March 2018.

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COMMUNITY

Anthony Thunstrom

Mary Vilakazi

Ronel van Dijk

Dumisani Dlamini new SANParks CFO Double-CFO-Awards-winner Dumisani Dlamini left his role as CFO of the National Arts Council (NAC) to take over from Rajesh Mahabeer as CFO of SANParks. We chatted to Dumisani about his new role at SANParks, his time at the NAC, and what it means to win two CFO Awards – Young CFO of the Year 2016 and Public Sector CFO of the Year 2016. Why are you excited about your new role as CFO at SANParks? “It’s always exciting to make a contribution to South African government and SANParks provides a great opportunity to make a difference in the conservation and tourism industry. It is not about crunching numbers, but it is about creating real value for business. There is a great executive team, great finance team and a great environment to work.” What was your proudest achievement at the NAC? “My tenure at NAC was a great experience and probably the best so far in my career. There were many achievements in that organisation but if I were to pick one, that would probably be assisting the organisation to obtain clean audits for three consecutive years.”

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What has winning two CFO Awards meant to you? “Winning two CFO awards opened many doors for me, including opportunities to speak at various conferences and other events. It has been a great inspiration for me to do more and be more. Not to mention the inspiration to other black professionals who are building their finance careers, it is a strong indication that everything is possible.”

XX COMMUNITY

Epic Till Vodacom Group CFO Till Streichert, CFO of the Year 2017 and triple CFO Awards-winner, rode and finished the gruelling Cape Epic mountain bike ride this year. Together with his riding partner David de Lima he achieved an astounding 75th place. By Joël Roerig

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“You learn how to work within your limits and then push them. You set yourself a target and push yourself to see how much you can achieve. Often, it is more than you think.”

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COMMUNITY

If you think being crowned CFO of the Year is epic, how about excelling in one of the planet’s most gruelling endurance races? Vodacom finance boss Till Streichert achieved both within a year.

ogether with his partner David de Lima, Till finished 75th in a field of 650 teams in the 2018 Cape Epic, the world’s most famous mountain bike race. “It is a world-class event, very competitive and I am pretty happy with what we achieved. For David, who did eight Cape Epics before, it was his best result so far.” Finishing the eight-day test of mind and body over an undulating – and sometimes ultra-steep – terrain of rocks, gravel and loose sand is an astounding feat in any context. Ranking not far away from mountain biking pros and former Tour de France stars as a busy and successful CFO is completely unheard of. “I ran my first marathon, in Munich, when I was 14,” says Till, when asked how he managed to keep up with famous pedalists like former Olympic champion Bart Brentjens, the American pro-cycling legend George Hincapie and a host of other big names. “From my 16th until my 26th I did duathlon – running, cycling, running – competitively and our team of three was vice-champion of Germany at some stage.”

CFO of the Year Till made a name for himself as telecoms finance manager in Germany, the UK and Romania, before coming to South Africa to join Vodacom in 2014. On 11 May 2017, Till was crowned CFO of the Year during the annual CFO Awards in Johannesburg. He also went home with the Strategy Execution Award and the Finance Transformation Award for the IT implementation, efficiencies, cost control and Tanzanian IPO he had been leading.

“To be successful, you have to leave your ego at home.” Getting up early and skimping on sleep are the only ways to combine a high-powered executive role with the training required to ride the Cape Epic, he says, admitting that the balance is difficult and that he

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won’t do the race every year. “I trained about 12 hours a week for the last few months, which is probably on the lower end to get to the top-75, but I do benefit from the foundation of all the sports I did when I was young. I got up at 4h00am twice a week and then used to ride between 5:00am and 6:30am or 7:00am, high intensity training – saving the long training rides for the weekends. I also get by on little sleep. As a CFO, it does mean you have to be very disciplined and have good day plans, as work is something you cannot scale back on.”

“It takes you to your physical and mental limits.” The Epic is widely known as the Tour de France of mountain bike racing and has been classified in the same difficulty category. “It really is unique and probably the most prestigious race in the world. What makes it really special is that it allows amateurs to race on the same day and start only five minutes later than the professionals. That is pretty cool,” says Till, adding that the race is as tough as he has ever come across. “It takes you to your physical and mental limits.”

Strengths and weaknesses One of the other special aspects of the Cape Epic is that it is a race for teams of two. After Till’s training partner needed to pull out, he managed to team up with David de Lima six weeks before the race. “We didn’t know each other, but we rode together brilliantly. To be successful, you have to leave your ego at home. You have to talk, listen and work with each other’s strengths and weaknesses,” says Till, who counts avoiding big risks downhill, pacing the first few days cleverly and playing to each other’s strengths and weaknesses as part of their strategy. “For me, that’s steep climbing and downhill, while my partner excelled on the flats and gradual inclines.” The “absolute highlight” was the queen stage over the Bainskloof pass into Wellington. “It was the hardest stage and we came 59th overall,” says Till, who admits

not having had much eye for the stunning scenery. “We were very, very focused on the race and the trail. You get very tired and see people losing control, even on straight downhills, right in front of you.” Till believes there are some important lessons for CFOs in mountain biking. “Sports in general teaches

you a couple of life skills, like honesty, humility and taking care of each other. Unless you are the world champion, there is always someone better than you,” he says. “You learn how to work within your limits and then push them. You set yourself a target and push yourself to see how much you can achieve. Often, it is more than you think.” l

Vodacom CFO Till Streichert following his cycling partner David de Lima. This photo and the photo on the previous pages by Sportograf.com.

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CFO AWARDS Judges reflect on the rise-and-rise of the CFO Awards

Benchmark for success Widely regarded as the prestigious ‘Oscars’ for South African CFOs, the CFO Awards started in 2014 and the credibility and eminence of the event leans heavily on the stature of the panel of judges. Claudelle von Eck (CEO IIA SA), Victor Sekese (CEO SizweNtsalubaGobodo) and Prof Ben Marx (HOD UJ Accounting), have been part of the panel since the start. We asked them to reflect on five years of CFO Awards. By Joël Roerig How do you look back at five years of CFO Awards? Victor: “It’s been an enjoyable experience and I have seen it improve every year. In the first year there was a little bit of experimentation to establish the process and as we progressed, the quality of enquiry by the judging panel has grown and matured.” Ben: “The awards are growing exponentially from year to year in size and also in stature. In the first year, people might have frowned a bit, but the recognition of CFOs has been very important. The awards have provided awareness and given prominence to the role of the CFO as a custodian of the company. Claudelle: “Part of what we are trying to achieve with the CFO Awards is for the nominees to do some self-reflection on where they are and where their organisation is. It is not just about answering questions. Hopefully people get asked questions that make them go back and make some changes. We often hear from nominees that they learnt a lot through the interview process. There is also a positive effect on other CFOs to continually improve if they aspire to be future CFO Awards winners. Showcasing talent brings a level of

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best practices.”

Why do you like to be involved? Victor: “You would think you get tired of it, as it is a lot of work, but I have been excited about it each year and always look forward to it. The stories of the nominees are often unique and interesting. For me personally, it is a learning experience and I have professionally grown through my involvement with the CFO Awards.”

of it. Attending the awards function also makes me very proud. It is amazing to see all these wonderful people and realise I taught many of them. Somewhere in my life I have added a little bit to other people, which is really great to realise.” “The awards are as good as the process and the people involved. Hopefully, I can add credibility and bring in my experience coming from a broad-based academic and practical background.”

“I am not a CFO, so it gives me a perspective on their daily challenges. For the broader finance community, it serves as a benchmark and informs people about how we define success. Personally, I am able to make much better suggestions to my own CFO in terms of certain improvements, informed by profiles of people that succeed. If someone has won an award, it a very helpful to look at their profile – how did they win that award – and learn about best practices.”

Claudelle: “The interaction with CFOs is rewarding, especially in the times we are living now, when there is so much bad news around corporate scandals, unethical behaviour and state capture. It provides great upliftment of the soul when you are able to interact with good people who are playing a significant role in our economy. Part of what I get out of it is a sense of ‘there is a hell of a lot of hope in South Africa’. It gives me a kick of joy to see what we produce in terms of good talent and good people.”

Ben: “It is enriching. You meet interesting people and encounter different views. It is nice to be part of an esteemed awards process and it is nice to be part of the growth

“It is also a learning process in gaining a better understanding of what is happening in various industries. From a selfish perspective, it helps me to get insight to be

able to relate it back to the profession in which I play a leading role. It helps me to understand better what my members, internal auditors, are facing.”

What do you look for when judging nominees? Victor: “I look at passion and enthusiasm. Because of the nature of the CFO portfolio, it is difficult to look at it as just another job. Without passion there isn’t much excellence you can achieve. Yes, you can reach the minimum requirements of your job, but in the end, it has to come from within. We have been fortunate that quite a number of nominees are bring-

In 2014 and 2015 former Transnet CFO Anoj Singh was among the winners. His awards were suspended in October 2017, as revelations about Anoj's conduct during his tenure at Transnet and subsequently at Eskom were found to be damaging to the stature and integrity of the CFO Awards.

ing that to the table. It allows us to look at other points or outliers that decide the winners.” Ben: “I look for honesty, depth and understanding of all the aspects that are addressed in the questions. You can quickly pick up if someone is boasting or if they have a deep understanding of what they are being questioned on. What also helps the judging is looking at the industry of the nominees for some context.” Claudelle: “I look for a person that is well-rounded. It is important that CFOs are not just number crunchers and that they have a very good handle on the strategy of the organisation. For me, it is key that they are emotionally intelligent. Sometimes you get people in leadership positions who are one-dimensional in their thinking of what winning and mak-

ing money looks like. What I find important is that CFOs are able to see their organisation in the bigger context of integrated thinking and being a good corporate citizen.”

What have you learnt about CFOs? Victor: “Being a CFO has become much bigger than reporting on numbers. Those numbers are still a critical part, but the role has evolved to being a business partner to the executives and being proactive. Gone are the days that CFOs are only reporting about what happened. The focus needs to be on what is likely to happen and what should happen. I do believe there is still scope for many CFOs to be more future-facing.” Ben: “There are people that are very dedicated, compassionate and committed to what they do. They understand their role and where

Claudelle: “We learnt a very hard lesson with Anoj Singh. The judging process is not a perfect science, as we are very dependent on people being truthful to us as judges. It is good that action was taken by CFO South Africa and the judging panel and that the awards Anoj received were suspended. It sends a very clear message that integrity and ethics are key to the awards. Ben: “The guy impressed me at the time, so what came out later is sad and disappointing. CFOs should be inherently ethical. The business sector is in serious difficulty and leaders are under a magnifying glass. If we don’t act against people who make mistakes, people will lose faith in the system.” The awards can be reinstated if a court judge or official commission of inquiry clears Anoj of all charges. The awards can be permanently revoked if a court judge or official commission of inquiry finds him guilty. This decision is at the discretion of the panel of judges and CFO South Africa.

Claudelle von Eck CFO MAGAZINE • CFO.CO.ZA

Victor Sekese

they want to go. Sometimes, you do attend nominee interviews where you are disappointed. Everybody is trying to paint the best picture there is, but sometimes it is more talk than substance. You will find that in any profession or industry.” “What really has stood out for me is that two young people that I nominated, Aarti Takoordeen (CFO JSE Limited) and Cobus Grove (former CFO Digicore), went on to win awards. It is an annoying perception that you must be 60 years old and part of the old boys' club to be successful. Those two people are examples of CFOs who show that is not the case. That makes me very proud.” “What has also impressed is the growing profile of CFOs in the public sector. You can see there is honesty and commitment. That is something very important. We need a strong public sector and for that you need strong financial people. Coming across people like Ramasela Ganda (award-winner

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for her role as CFO of Ekurhuleni Municipality) is encouraging for me. It is a person that is committed and doing it for the right reasons.” Claudelle: “More often than not, I have found myself pleasantly surprised. I used to work for SAICA and have often come across CAs who are blind to people around them, who show a degree of arrogance that discounts the value that others bring to table. What I have found in a lot of the CFO Awards nominee interviews, is CFOs who really understand how interconnected we are – and CFOs that really care about uplifting people and about transformation.” “CFOs spend an enormous amount of time coaching, mentoring and growing people. That defies the stereotype around the title. It is heartening for me to hear people talk about B-BBEE with sincerity and with a deep understanding of why transformation is needed beyond ticking boxes and compliance. Often, CFOs have an

enormous amount of power in how resources of their organisation will be spent. If they come from a position of humaneness, it stands to reason that one should start to see more and more of our corporates playing a significant role in turning South Africa around and taking it where it needs to be.”

How do you see the future of the finance profession? Victor: “CFOs tend to be custodians of quite a lot of data and information. It is a question of understanding what this data means from a business point of view and on a strategic level. My own personal prediction is that more and more will be required and demanded from CFOs with regards to leveraging data to turn it into a strategic advantage. AI and analytics are playing a critical role. Yes, you do have data scientists who are involved in this, but as a CFO you have to work in tandem with them to make sure the data is of value to the strategy.”

Judges score each nominated CFO on a scale from 1 to 10 in the category for which they are eligible. By adding up all the points, the winners are determined for each category. The votes for the specific categories will be tallied to determine who wins the Public Sector, Young & CFO of the Year Awards. The 2018 panel of judges is: •

Aarti Takoordeen, CFO JSE Limited & Young CFO of the Year 2014

•

Ben Marx, HOD Accountancy at the University of Johannesburg

•

Brett Tromp, CFO Discovery Health & Young CFO of the Year 2015

•

Carel Smit, Executive Committee Member KPMG South Africa

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Christo Els, Senior Partner Webber Wentzel

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Claudelle von Eck, CEO The Institute of Internal Auditors South Africa

•

Deon Viljoen, Group CFO Alexander Forbes & CFO of the Year 2015

•

Kevin Black, Africa Clients and Industries Leader, Deloitte

•

Leon Crouse, Former CFO Vodacom and Remgro & Winner of a Lifetime Achievement Award 2016

•

Mary Vilakazi, COO FirstRand (from 1 July 2018) & former CFO MMI

•

Simon Ridley, Former FD Standard Bank & CFO of the Year 2014

•

Sneha Shah, MD Africa Thomson Reuters

•

Victor Sekese, CEO SizweNtsalubaGobodo

•

Wiseman Nkuhlu, Chancellor of the University of Pretoria

Prof Ben Marx

Ben: “Despite the growing role of technology and the fourth industrial revolution, you still need an element of personality, human judgement and professional scepticism. That can’t be replaced by a computer programme or AI. The CFO’s role will change to become a visionary, strategist and manager of information, but you will lose innovation and controls if you replace humans completely. Sometimes the CFO also needs to look at what is right for the greater society.” Claudelle: “Leadership is becoming more complex. CFOs need the ability to connect across spheres that are not familiar to them. Technology is also impacting the role. How do you lead a team that is a combi-

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nation of humans and AI? How do you lead people who you are not going to see face to face? How do you keep human beings connected with AI in the game?” “There is going to be a much greater focus on understanding value creation. Value is in the eye of the beholder, but it should be way beyond increasing financial capital and include the other five capitals of integrated reporting. I think that the one who keeps the wallet is becoming increasingly less important as opposed to the one who is able to see and create value.” l

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ROLLING UP YOUR SLEEVES Logic, simplicity and a focus on what they do well. That is what Lucas Verwey feels he has brought to Distell since he joined them from Investment Holding company, Remgro. “This job is much more hands-on. It is about rolling up your sleeves and empowering the team. It’s a very dynamic role where I find myself in the centre of anything that goes on at Distell.” By Joël Roerig

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“Sometimes it takes months, but logic and numbers always prevail. If I’m trying to understand an issue, I don’t go in like a bull in a china shop – I prefer to lean on simple logic.” CFO MAGAZINE • CFO.CO.ZA

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Although the Stellenbosch-headquartered beverage giant is tackling various big projects simultaneously, the hard work has paid off, with a strategic focus on the simplicity of their business model, brands and driving expansion on the African continent. Similar to the current Group MD, Lucas was not part of building the original Distell. “Being separated from the legacy helps with the speed of changes that need to be made,” says the FD, who was nominated for the 2017 CFO Awards. “With a fresh set of eyes, I can bring a new and refreshed perspective. My belief is: people need to be responsible and think for themselves. For me, simplicity, logic, empowering people and value-based principles are crucial for Distell’s success.” Distell owns best-selling brands like Savanna, Hunters, Nederburg and Klipdrift. From the start, Lucas had his work cut out by bringing a fresh perspective to its large portfolio of hundreds of brands to ensure returns were optimal and the company played to its strengths. “Focus and simplicity were desperately needed,” says Lucas, during the conversation with CFO Magazine and Standard Bank CIB’s Rato de Mendonca, Head of Clients in the Western Cape.

Turnaround specialist Lucas grew up in Bloemfontein, where his father was a partner at accounting firm PwC. Throughout his career he has been a turnaround specialist, working mostly in Cape Town and London on M&A, due diligence projects, accelerated integrations and first-100-day-plans. After running his own distribution business before an oil & gas focused stint at KPMG, he joined Johann Rupert’s investment group Remgro in 2008. Before getting his hands dirty in the Group FD role at Distell, he already had sat on the board as alternate non-executive on behalf of Remgro for nearly two years getting to know the company well. This prepared him for his appointment in 2014 to move into a strategic

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role before replacing Merwe Botha as Group FD a year later. Since he started as Group FD, Lucas has overseen crucial projects such as the implementation of its shared services centre (The Hive), built new management planning/reporting systems and routines to enable better insights, implemented SAP in both Distell International (formerly Burn Stewart) and Taiwan, refinanced the group's debt and played an integral part in some of the recent M&A activities – eyeing the African market to double its revenue and profit. “We did all those change projects at the same time. In hindsight we should have picked fewer, but we learnt a lot nonetheless.”

Enthusiastic and pragmatic Lucas comes across incredibly relaxed given some of the pressure him and the team have been through at Distell, dealing with issues such as the current drought in the Western Cape and the potential impact on its business. “You have to be enthusiastic and pragmatic about what you do. Hopefully that rubs off,” he says, when asked what type of leader he is. “The team should not be

built around me, but around a structure. I do the hard work together with the team and make myself accessible. I’m grateful to have a very strong team around me, although you can’t delegate everything. It is a very fine balance between high level and detail, because you can’t be high level without understanding the detail first. You also need to allow people to fail falling forward, as our Group MD Richard always says.” One of the biggest projects Lucas has been responsible for has been the implementation of a 150-people strong shared services centre in Tyger Valley, away from the traditional corporate home in Stellenbosch as part of a concerted effort to be able to attract more diverse talent. The centre was implemented by James Wilkinson, last year’s winner of SAICA’s Top 35 under 35.

Shared services Lucas says The Hive, as the centre is called, comprises procure to pay, order to cash, hire to retire and record to report processes for the beverage company, which employs 5,000 people. “It is fascinating to see. It is exceptionally high-tech and the new way of working is designed as one flow, like our processes. I am very proud of it. It is a massive change for the business and this is only one piece of the finance transformation on which we have embarked.

COPING WITH THE DROUGHT As the Cape is yearning for rain, Distell has managed to use 30 percent less water in 2017 compared to 2016, even before water use restrictions were announced. The company has an intricate plan in case Day Zero does gets implemented. “We have our own farms, which is why we were starting to see the problem early on,” says Lucas, who indicated that the water issue had been identified as a risk long before it became a provincial issue. “That is why we have started to shift the production of high-volume products to Gauteng alongside existing water-saving initiatives and making use of borehole sources. The drought has been the catalyst for some of the further changes and we are working with local and national government in doing our part. We are fully committed to the Western Cape.”

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We have also decided to focus our brand portfolio and consolidate our supply chain alongside this. The goal is to take R500 million out of the cost base to re-invest in people and brands.” Although The Hive is about cost saving, efficiency and a leaner organisation, it is also about the proper use of technology and data, says Lucas, who also oversees this portfolio. “IT is where everything in the business intersects. For around 60 percent of every project we do, technology is at the centre, whether it is a salesforce handheld, printing on a truck, automating warehouse, reporting systems or implementing fingerprint security. The team, headed up by Corlia van Zyl, is doing a phenomenal job.” With most change projects completed, the nature of the CFO role is changing too, Lucas observes. “The pendulum is swinging to an outward focus and my role is becoming more strategic. It is evolving from the ‘spoeg en plak’ project management that it was, to more of a business partner to the CEO, helping to validate and soundcheck decisions.”

Logic and numbers A calm, unfazed demeanor surely helps achieve maximum influence in the boardroom, which suits Lucas. “Sometimes it takes months, but logic and numbers always prevail. If I’m trying to understand an issue, I don’t go in like a bull in a china shop – I prefer to lean on simple logic. As finance, we play an integral role as a business partner to the the rest of the business, for example when looking at expansion into Angola, we recalibrated our ambitions to a pay-as-you-go approach. It still gave us the bene-

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“It is a very fine balance between high level and detail, because you can’t be high level without understanding the detail first.” fits of future upside but managed the risk that operating in Angola brings."

MENTORING IN THE TAVERNS “For me, mentoring is a continuous process and not an event. We don’t stay in the office for our sessions, but go to the taverns and outside operations together. They learn from me how I look at things, but I usually end up learning more from them.”

Distell operates in a global market, with variable FX fluctuations and increased competition in the ciders market. “We need to fight with what we do best, with extra emphasis on the mainstream end,” says Lucas. “Our 4th Street has been the fastest-growing wine brand for some time. We are now recruiting wine drinkers in the taverns,” says the FD, adding that the company has doubled its number of drop-off points in townships over the last few years. “Hopefully we can take those customers on a journey to more premium brands.”

Thirst in Africa Distell’s eyes are now set on quenching a growing thirst in other African countries. “We do have a big role to play in South Africa and need to be responsible, as we have the majority of the local wine and cider market and contribute R7 billion in alcohol excise annually to SARS, but our main inorganic thrust is M&A into Africa. The acquisitions and integration of Best Global Brands (BGB), which operates in Angola and Nigeria, and Kenya Wine Agencies Limited (KWAL) are already starting to pay dividends.” Distell introduced new ways of working and new systems at KWAL and with a new CEO, managed to improve margins from four percent to 12 percent in a short space of time. “We are buying, integrating and changing these businesses. Currently, 15 percent of our revenue comes from Africa, approximately R1 billion. Our plan is to grow that to a much larger contribution by 2021. The continent has the best demographic in the world in terms of growth prospects. Of course, Africa comes with its challenges, but it’s the last untapped continent and building upon our experience.” “These big decisions are all intricately linked to finance: understanding the business, with the owners and team. It is a big portion of my time. It also creates exciting new opportunities for Distell people to expand and develop themselves. If we grow, they grow!” l

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Webber Wentzel’s Megan Jarvis lists six dos and don’ts

How to strike the perfect deal Deadlines, the right pace and face time are among the most important tools to strike a great deal, says Webber Wentzel’s Megan Jarvis, who is observing an increasing role for the CFO during dealmaking. By Kate Ferreira

egan Jarvis is a partner in the corporate practice at Webber Wentzel, specialising in commercial and corporate law where she focuses primarily on the deal-making nitty gritty around mergers and acquisitions (M&A), empowerment transactions, and joint ventures. The majority of her clients fall within the mining, construction and infrastructure fields. Before joining “Webbers” in 2010, and after her articles and initial legal experience, Megan spent 10 years in legal at some of the big accounting firms that broadened

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their focus to include professional services. It’s a long pedigree of hand-on experience that has given her critical insight into deal-making, and the role of the CFO within deals. Here are Megan’s six dos and don’ts for dealmaking:

DO set a deadline

“Technology has changed the game a lot, but it does mean that you can have several versions of transaction documents out there, and the parties can get lost in a cycle of endless changes

and reverts. Given this, one of the things that's quite important is to try and draw a line in terms of a timeframe for signing as part of managing the deal-making process. This helps establish a predictable timetable.” “If there is no deadline – and no subsequent urgency as to when the parties need to close – then the process can drag on and on. A timetable helps manage the negotiation process. It also helps keep perspective on what is critical, what the deal-breakers are, so that the parties don’t keep chasing rabbits down holes.”

DON’T speed through it

“The opposite is also true – you can go too fast. Sometimes it is the target company that is pushing timelines and that can be difficult to manage. When somebody wants to push a deal through very quickly – without making sufficient time for due diligence and considering all the necessary aspects – that raises a red flag for me.” “Sometimes they don’t want you to see something, and sometimes it’s just inexperience and eagerness, perhaps from a new start-up target. That’s why having a sensible timetable that both the buyer and the seller have agreed to is so useful for structuring your deal up to signature and closing.”

DO have sufficient face time

“Negotiations are a lot about preparation, and being prepared for those negotiations requires having had sufficient time with your clients to understand

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from their perspective what the particular deal-breakers and touch points are. So while we can, to some extent, resolve issues through the drafting process, face-to-face meetings with the client team and the other party remain critical. There are non-verbal cues that are quite important to observe and take account of in a negotiation, and face time is the only way to pick up on these.”

DON’T skimp on appropriate legal advice

“Another potential difficulty or stumbling block is if you have a party to a deal who doesn't appoint external legal advisors. It is always more difficult having to negotiate a deal with management or internal counsel who may not be as objective as an external third party, and might not to be equipped with all the relevant skills to effectively deal with the often complex aspects of a major M&A or similar deal.”

DO know what you want to achieve

“A key aspect of doing good deals lies in the client knowing what deal they want to do, and perhaps more importantly, why they want to do the deal. They need to be clear on why they think this is a good deal for them. This makes the negotiation process easier, as you have a clear view of what is acceptable and what is not, which enables you to try and come up with solutions if there are particular obstacles that are encountered.”

“Of course, you also need alignment internally on these issues, and we do see cases where there are differing views within the client team. This needs to be ironed out or resolved to move forward.”

DO know when to cut your losses

“It can be quite difficult when two parties are 'wooing' each other and something arises that suddenly makes it clear that this actually won’t be the deal you had in mind. Perhaps something comes out during due diligence, or it seems you won’t get the returns required on investment. Perhaps there is a culture mismatch, or risks arise that make the deal less palatable.” “For whatever reasons, when it becomes clear that you no longer want to pursue the deal, it helps to have a CFO in the process who is able to tell, and sell, that story. The CFO can be the voice of realism in the process, and you want one who can bring others around to that decision when and if there needs to be a hard decision taken not to proceed.”l

The role of CFOs Megan feels the changing role of the CFO reflects a necessary shift. “I believe this has gone from one with a strictly financial and internal focus, to seeing CFOs play a much broader role – generally and in deal-making,” she says. “Progressive and strategic CFOs tend to take a clearer stance on ‘selling’ the deal to the board, shareholders or deal-making teams.” Beyond this, she says, it is also positive to see more CFOs being involved in the decisions around technology and systems deployment in organisations – deciding what technology is appropriate and needed, and naturally the financial aspects of implementing particular systems. These are necessary in enabling the CFO to see the bigger picture, to capture the right data points, and to drive efficiency from an operational perspective – all of which is critical when you look at integrating an acquired target company into a business, post-deal. “In this way, the CFO becomes an active caretaker of strategy, and assists the CEO in telling the story of the business vision, and the deal therein.”

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“One of the things we do when we invest in businesses is to look at the quality of the CFO. That individual is very critical as they become our eyes and ears into the business. They are the person who ultimately gives us lenses into the details of what is happening in the business.”

TSHEGO SEFOLO: CFO IS KEY TO PE By Kate Ferreira

shego Sefolo is the CEO and founder of Agile (pronounced ah-ghee-le) Capital. Alongside Director Londeka Shezi, Tshego has – through Agile – invested huge sums in growing businesses in the South African market. They describe themselves as sector-agnostic, and have holdings in energy, engineering and outdoor media, among others.

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It’s a dream decades in the making for Tshego, who started his career as a chartered accountant at EY. For him, pursuing private equity (PE) offered a challenging career that would expose him to different business environments – outside of the routine that can sometimes be a part of the traditional accounting route.

“Additionally,” he says, “what was attractive is the fact that, in PE investing, you really can live by your convictions if you identify a business to put money into. In this way, it’s a cradle-to-grave business scenario where you’re looking at putting five to ten years into these businesses, to really manage where you put your money and ultimately realise what you want out of them.”

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A marathon, not a sprint Tshego seems to really embody this active and people-centric view – both in his investment choices and outside of the office. When he’s not at his desk, Tshego is a keen half-marathon runner and golfer – two sports that also suggest Tshego’s not afraid of playing the long game. The ideas of longevity, growth over time, and sustainability come up repeatedly when he lays out his views on investing. It also plays into his aspirations for Agile and himself. “There are several big established companies in this PE space, but South Africa is an emerging market, and I think it is ripe for someone with the right energy to build something significant that will transform the landscape and challenge these established business. We want to be that dominant, well-established financial services group,” he says.

People, not products Tshego’s view is one of mutually beneficial investment. He says: “At the heart of it, PE is in the business of deploying capital and putting it behind a team of people so that they can grow and execute on what we call an investment thesis that we have bought into.” This is why the management team of a PE recipient business; is so critical. Agile looks for a management team to back, as much as a business, a team they are convinced has the key competencies to achieve their growth plan, and one that can deliver on those investment objectives. A key figure in the mix, then, is the CFO – who Tshego calls the “financial hub” of a business. “One of the things we do when we invest in businesses is look at the quality of the CFO. That individual is very critical as they become

“It is important to get comfort that the people we bring in are people who understand ethically and morally what the right thing is.” 38

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our eyes and ears into the business. They are the person who ultimately gives us lenses into the details of what is happening in the business.” He continues: “In some instances, we have placed requirements for investment on bringing in our own CFO. He or she has an in-depth understanding of what we are looking for, what the critical areas of what we are worried about from a finance business are, and can work with us to address those issues.”

Ethical view The ethics of a business – and its management – is another key element that Agile looks for in their investments. “It is very important to us,” Tshego says. “We are investors in the South African market. One of the things that is key is to make sure we build sustainable businesses for the long term, and there is no way you can do that without making sure that, ethically, you do business correctly.” To this end, Agile will participate in the board, and often in a social and ethics committee that ensures ethical practice on an ongoing basis – whether that’s for staff, stakeholders, or the communities the business engages with and operates in. “We enforce this rigorously. We look for those sort of features when we get into partnership, and when we employ management teams, especially CFOs. It is important to get comfort that the people we bring in are people who understand ethically and morally what the right thing is.”

Skin in the game This is just one of the reasons that Agile likes their partners and management teams to have “skin in the game” – to be invested and incentivised on both outcomes and financial discipline. “As part of our due diligence exercise, we would look at the CFO, the team that he has got, and the financial systems, and the reporting parameters that they have put into the business,” he says. “In my experience, a CFO who has worked alongside PE investors and has been incentivised to work with the investors, has created

significant value for themselves and for us. That way, when the investor generates a return, the management team also generates a return for themselves. That enforces a type of discipline in terms of decision making.”

Injecting capital – and value PE is not just about extracting value from capital inputs. Tshego argues that PE investors are enablers of growth – both organic and through acquisitions. “In the former, we are able to advise on

how to grow product ranges or grow into new markets. On the latter, we have a vested interest that goes beyond financial. We get quite involved in enabling that, in facilitating that, and making sure it is done in a disciplined manner where you don't end up overpaying or not getting the returns you paid for.” Frequently, he says, the businesses they invest into are owner-run. These can grow to certain levels on those entrepreneurial terms,

but when they hit critical mass – say, around R200 million – the processes and procedures in the business need to be robust enough to take it to the next level. Here they provide the outside perspective – not of a consultant – but a partner who can be “a strategic shareholder and stakeholder, with a deep pool of capital, who understands what the imperatives for growth in the business are, and who has the means and resources to facilitate that”. l

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FINANCE BY

DAY

FASHION BY

NIGHT

A powerhouse finance head Monday through Friday, Nyasha Madavo, CFO of Black Umbrellas, spends her free time designing women’s clothing – a passion she has harboured since childhood and a business she has been nurturing for the past three years. We caught up with her to peruse the racks at her studio, House of Perle, and find out about her business – both on and off the clock. By Toni Muir

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“

The beauty of entrepreneurship is the ability to learn from any experience – good or bad – and use this to better equip yourself. It requires perseverance and a constant willingness to learn,” says Nyasha Madavo, from the cool and quiet lounge of her Sunninghill house. It is a home that is open and bright, elegantly decorated, the walls adorned with colourful artworks and gilded mirrors. Nyasha Dzumbunu recently married her varsity sweetheart Terry Madavo, and an assortment of congratulations cards are on display in the dining room. Nyasha shows us into the garden, where we chat easily, enjoying the fragrances of the semi-tropical plants around us. Our interview is also a photo shoot, and Nyasha smiles broadly, standing tall and proud in clothes of her own design.

Dressing up A seasoned finance professional, Nyasha’s career includes several years with Deloitte and the last two-and-a-half years in her current role at Black Umbrellas (BU), until recently known as Shanduka Black Umbrellas. It is one of the leading non-profit enterprise and supplier development organisations in South Africa and is backed by the Cyril Ramaphosa Foundation. While she certainly excels in her chosen field, Nyasha has always been fascinated by fashion. “My love of fashion is something I’ve always had. I’m a girly-girl,” she says with an easy laugh. Nyasha recalls her childhood and says she was a typical little girl who loved

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dressing up in pretty dresses, skirts and shoes, and remembers her mother sewing her some dresses too. “I think it started to grow then already and blossomed with time. I never explored it outside of it being something I enjoyed from a distance,” she says. As an adult working in corporate environments, Nyasha found the availability of off-the-rack business wear a little dull and uninspired. “I was frustrated when I went out looking for clothing because all I could find was the same stuff and I thought, we are all going to look the same because we all shop in the same places! I thought, I can’t be the only one experiencing this,” she says. “I went into business with a friend and we started small by importing a few beautiful items of clothing. In time, I started working on my own designs. For me, this is a creative outlet but it’s also about helping other women to look and feel spectacular and to help them express their unique feminine brand and increase their confidence.” Although the business partnership wasn’t meant to be, nothing stopped Nyasha from working towards her own clothing line. Today, she works with a pattern-maker and several seamstresses and does all the fabric sourcing herself. “I have a feel for the kind of materials I want. I want quality fabrics, so that when someone invests in a piece it’s going to last. From designing, to fabric shopping, to manufacturing, to meeting clients – I love the entire process,” she says, eyes twinkling with visible delight.

Entrepreneurship “I have a passion for entrepreneurship,” Nyasha says. “I think this came from my childhood. I was raised by professionals – my father was a CA and my mother did CIMA – who went on to start their own entrepreneurial ventures. My parents were always in business in some shape or form, and still are. So, that was already ingrained in me. Nyasha says that, given her demanding career, the road to entrepreneurship hasn’t been an easy one. But, she says she’s learnt a lot and certainly grown a lot. “I now have plenty of tricks in my tool bag,” she says with a laugh. “I’ve also learnt to persevere and to keep moving forward. Any step forward is a step in the right direction. Looking ahead, I need to really map out what I want to achieve and probably sacrifice a bit more time so that I see all of those plans come to fruition.” Nyasha says that running her own business has taught her a few things: “Never underestimate the importance of managing your cash flow,” she says. “Corporates constantly need to optimise their working capital too. While managing your small business, you have to ensure that you are running a financially healthy and sustainable entity, and that you deliver quality product, grow your client base and work with your partners in a mutually beneficial manner.” Asked whether her knowledge as a CFO has been of much use, Nyasha says of course, though on a smaller scale. “I have used my experience

to help me with sales and marketing, building and maintaining relationships with clients and suppliers, and negotiating better payment terms, among other things. I’ve also learnt the importance of brand and reputation management. Ethical and responsible business is non-negotiable for me.”

Day job With such an exciting venture keeping her busy after hours and during weekends, what about her day job? Nyasha is equally passionate about BU. “I love being part of the organisation and seeing the impact of the work we do. We call it ‘heart work’ as we are not only helping black business owners develop sustainable businesses, but we are contributing towards real economic and social transformation. The enterprise and supplier development space is so dynamic and exciting and we see real change happening, which is fulfilling,” she says. Asked what’s currently keeping her busy, Nyasha’s brow furrows slightly as she answers: “Risk management. Risk is an important aspect that we are trying to entrench into our day-to-day work. We’ve been on quite a journey in terms of entrenching a risk awareness culture into the organisation. We’ve gone through a process of training up the teams, and now you can hear the conversations upfront about the potential risks we are facing, which allows us to actively plan mitigating actions and ensure that we continue to be able to make more of an impact on the SMEs that are our beneficiaries. Risk is a critical aspect of governance and something every team member has to be involved in. The more embedded the risk awareness culture, the better positioned you are as an organisation to achieve your objectives and deliver on performance. Much of our focus in currently on mitigating funding risks and a

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lot of stakeholder engagements are underway.” “We need to ensure our coffers are well managed so that they can impact as many beneficiaries as possible,” she explains. “The quality of our reporting – both internal and external – is an important aspect of demonstrating how accountable we are to our various stakeholder partners. We do that through our monitoring and evaluation capability, which is how we track the performance of each business that comes into BU, measure impact

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and share our performance metrics. Our businesses have hit the R2.4 billion mark recently, in terms of cumulative revenue generated, since the inception of the programme ten years ago, and this is very encouraging and spurs us on to push for more.”

Big plans Looking ahead, BU has big plans afoot. “I’m really excited about the new strategy we’ve embarked on, which will see BU become a sustainable organisation – one that

will outlive us all!” says the enthusiastic CFO. Nyasha adds that the team is currently looking at different projects in a profit-making aspect, aligned with the work that BU does, specifically around entrepreneurship training, consulting and enterprise and supplier development, while also looking at innovative ways to bring SMEs together with investors for fundraising purposes. “The goal is to develop a sustainable social enterprise to fund the non-profit side of our business,” she says.

Something else which Nyasha is visibly excited about is BU’s recently established entrepreneurship academy: the NextGen SBU Academy, which offers bespoke programmes to entrepreneurs. She says that NextGen differs from a conventional incubation programme in that it doesn’t require a business to undergo a three-year development journey, as shorter courses are available. It allows us to cater for more businesses as it not only caters for 100 percent black-owned businesses, and we are able to offer a wide variety of training programmes, including

those for franchisees and master classes, which are better suited to larger businesses." The organisation has also set its sights on the rest of Africa. “There is great need for entrepreneurial development on the rest of the continent and we excited about the conversations already underway in this regard,” Nyasha says.

Inspiring designers Asked what plans she has for House of Perle, Nyasha considers before answering: “I want to increase brand awareness within

my target market and collaborate more effectively with other designers. I’ve met a lot of incredible and inspiring designers who aren’t even known and produce beautiful work. I’m also exploring a boutique that showcases various designers – located in a busy commercial space.” Asked whether she’s thought of leaving the corporate world to pursue her fashion dream full-time, Nyasha gives a hearty laugh. “Not just yet, I still have a lot I want to achieve here!” l

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Business leaders were equally inspired and challenged during the first ever combined executive summit for CFOs and CHROs in the beautifully decorated Summer Place in Hyde Park, Johannesburg. Larger-than-life Sygnia CEO Magda Wierzycka took the stage to call for visible leadership, followed by a panel discussion with equally dazzling Aarti Takoordeen (JSE Limited) and Sean Doherty (Standard Bank). With a historical political turnaround less than 24 hours earlier, the ascent of president Cyril Ramaphosa, the venue was brimming with optimism and positivity. The event was opened by Phil Wilmington, vice chairman of Workday, the finance and HR software solutions company that is blowing traditional ERP and solutions providers out of the water on a global scale. He admitted to being “impressed by the energy and enthusiasm” of South African business leaders and professed to be amazed at the “fantastic turnout” for the event, which doubled as the official South African launch of Workday. While the burgeoning community of (250+) South African companies that are already using Workday were treated to a marvellous display of modern-day innovation and effective simplicity, finance and HR leaders broke away in a separate session to discuss what it means to be the change.

The power of my voice Magda Wierzycka, who rose to prominence in 2017 as the business leader who boldly stood up against corruption, set the tone with a no-holds-barred keynote. She spoke about the personal sacrifices, the initial backlash against her investment company and the self-imposed pressure to live by the publicly professed standard and values. “All I

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had was the power of my voice and I never even expected so many people would notice. It was a strange thing to do for a business person.” Even though Magda admits 2017 was “not a pleasant year”, she says she has no regrets. “The most important lesson is that leadership must be tangible and visible. You cannot hide behind faceless organisations and slogans. Corporates need to show visible leadership at all times, not just when there is a crisis like we had,” said Magda, who named parting Investec CEO Stephen Koseff as one of the outspoken people she admires.

Personal commitment The panel discussion then saw some very personal and hard-hitting insights from JSE CFO Aarti Takoordeen, a former Young CFO of the Year, who was also named World Economic Forum Young Global Leader. “As a millennial, I cannot accept incongruence between my values and the people I work with.” Aarti had the audience captivated when she spoke about her personal commitment to being the change and influencing others to do the right thing and thrive. While Magda and Aarti would be a tough act to follow for most executives, Standard Bank CIB’s IT and finance guru Sean Doherty also left an indelible impression, taking the 90 executives in the audience through his personal and professional journey. He candidly spoke about his separate work and personal persona and how they finally merged after his now three-year-old son was born. “It has made me a lot more real,” Sean admitted.l

Dion Mhlaba (RH Managers)

Graham Fehrsen (CFO South Africa, Aarti Takoordeen (JSE Limited),

Magda Wierzycka

Sean Doherty (Standard Bank IB) and Magda Wierzycka (Sygnia)

(Sygnia)

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A Q&A with Jasco CFO Warren Prinsloo

BILLY BANK RECON Warren Prinsloo is an often-seen guest at CFO South Africa events. In this Q&A, he reveals his CEO ambitions, his leadership approach and how he learnt to work smarter. He also lets slip which animals frighten him the most. By Toni Muir

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While I was doing vacation work at EY in return for a bursary, I picked up the nickname ‘Billy bank recon’, because there wasn’t a bank recon I couldn’t do. The name stuck,” says Warren Prinsloo, Group CFO of Jasco Group, a JSE-listed smart technology and solutions company. Warren has been in his role for 12 years, and has his sights set on a CEO position, one day. “Because CFOs work so closely with the CEO in partnership, this is like a natural progression. You know where the risks and opportunities are in the business, you know the pain points and the pleasure points. As CFO, you’re very in tune with the business.” Q Tell us in brief about your current role and responsibilities. Is your role focused more on finance or on strategy?

“I’ve been with Jasco for 12 years. When I first started, my role centred around the finance function, though over the last three or four years it has shifted, and I now have more to do with strategy and better understanding our customers. A big part of my role is understanding my counterparts’ requirements. I’ve spent a lot of time understanding the requirements of the telecoms operators and what role we play; how we can come to the party. I am also very involved in due diligence and assessing teams, as well as understanding the business’ problems and figuring out how to solve these.” Q Tell us about your team. What are its strengths? “Given the size and nature of the business, I’ve structured my teams accordingly. We looked at what kind of minimum scales we needed to achieve – for example, we put businesses together to reach

affordability levels, so we had an FD and MD combination. That combo can look at several business areas, and each of the businesses benefit from that level of expertise and experience. I’ve structured my teams in line with this and have a mix of FMs, accountants and admin clerks in the teams. We’ve got Carriers, where we build and maintain networks; an enterprise business unit, which looks after corporate SA; and we’ve got Electrical Manufacturers in Durban; and the Intelligent Technologies and Enterprise businesses. The businesses above R200 million revenue have an FD, and businesses below this revenue level have an FM.” “I run a monthly finance forum that includes the FDs and FMs, plus some of the younger accountants to give them exposure. The discussions are topical to the time of year, so we might have a bud-

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get theme or a year-end theme. We cover different activities at different times of the year.”

a growth phase, looking for acquisitions to take our business to the next level.”

“In terms of strengths, we’ve got a good blend of technically qualified staff and experienced staff. Those at the top know how to run a finance department and support the MDs. We also have a routine where we run monthly review meetings of the businesses, looking at the operational and financial performance. This includes sales pipelines and, orders on hand, where we focus on the forward projection.”

Q What external factor has the biggest impact on the company’s results?

Q What is your leadership style like?

"The rand volatility, where the currency moves in an unexpected fashion, is difficult to contend with. It doesn’t matter if you have a hedging strategy in place and if you regularly review this, our policy is not to speculate on the rand. When the rand does something suddenly you could end up with a smile on your face or a frown.”

“I think I lead by example. I’m prepared to walk the hard yards and put the hours in. My team has seen this from the outset. I’ve got empathy and I understand people’s problems. I’m also a very fair person. People know if they’ve not performed, what they’re going to get from me. I’ve always applied that rule in my career – you don’t tolerate substandard performance, you deal with it.” Q To what do you attribute your career success? “Over the last three or four years, I’ve started working smarter not harder, which I’ve put down to the influence of our CEO, Peter da Silva. During my first five years at Jasco, I worked hard and built strong relationships with the business unit MDs and FDs and understood their challenges and how I could support them. I looked at my group role as an enablement role. The next five years were full of new learning experiences as we set about restructuring the organisation. That chapter ended in 2016 for me. Since then, I’ve been taking the new-look Jasco into a challenging environment and, as we are in

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“Political factors resulting in rand volatility unexpectedly impacted the forward cover positions we had, which resulted in both profits and losses between 2015 and 2017. In the longer term, we don’t like a weakening rand because our imported technologies become more expensive for our customer base."

“Economic growth locally has also been a problem. This is part of what motivated us three years ago to go to Kenya in East Africa, where we set up shop in 2015. There is a lot of opportunity there; resources are very qualified and we can train them on our technologies if needed. We are looking at our portfolio and what we can sell in the Kenyan market. The political situation in 2017 has impacted negatively on the corporate sector and we hope for stability to return in 2018.” Q You have your eye on a future CEO role. How do you think the CFO roles prepares one for this move to CEO? “This move is becoming more common these days, probably because CFOs work in partnership with

the CEO. You know where the risks and opportunities are in the business, you know the pain points and inner workings of the organisation. As CFO, you’re very in tune with the business. Can every CFO make this transition to CEO? No, it depends on the character of the person. I think, because I’ve always had good leadership attributes and inspire confidence in my teams, it would be a natural progression to move into a CEO role.” Q In your free time you are a hobby farmer – tell us about this. “This goes back to 1992. I learnt a lot from one of the audit partners I worked with. He said land is in short supply, ensure you have enough of it. I bought a small farm in Magaliesburg. When I bought it, it had two cows on it, but I discovered I was scared of cows, so I sold them. Instead, I started breeding miniature horses. I’ve sold some off but kept a few. I also tried my hand at small-scale sheep farming.” “We have an interior atrium in Jasco’s building and for about a year I pushed our facility manager to do something different with this space. We eventually pulled the ferns out, put compost in, and planted some vegetables. Now our facility management staff take these vegetables home with them.” Q How do you like to spend your free time? “I have three children, ages 20, 18 and 14, so free time is spent together as a family. My youngest recently discovered golf. My wife also enjoys going onto the golf course. So, we play a bit of golf as a family. I also spend a fair amount of time with my son on the sports field.” l

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An interview with Westfalia Fruit finance boss Bongani Manzi

HUMBLE BEGINNINGS, GREAT AMBITION Bongani Manzi aims to become the CFO of a leading South African company in the next three to five years, but he never forgets his roots. By Georgina Guedes Bongani Manzi is a self-described “rural boy” hailing from Mount Frere in the Transkei. He has built an impressive career for himself, now working as the GM of Finance at Westfalia Fruit, but he says his roots keep him humble. “It’s never been easy. I didn’t grow up with a silver spoon in my mouth. It helps me when I deal with people – I always come from a position of respect. I don’t see myself as being any better than anyone else. It doesn’t matter which road in life you come from, we are all human beings with hopes and dreams and ambitions.” Bongani has a lot to say about hopes and dreams, as one of five boys born to a single mother. For the first

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10 years of his life, he lived with his grandmother in Mount Frere, but as it became apparent that he and his twin brother had academic potential, they went to live in Umtata with their mother so that they could focus on their studies. His mother had initially hoped that he would become a doctor, but Bongani didn’t agree. “I think I have something of a rebel in me,” he says. “As soon as they told me I should become a doctor, I decided that they couldn’t tell me what to become. So I started looking at options other than being a doctor.”

Studies and pitfalls Bongani ended up going to UCT to study electromechanical engineering (his twin brother went with him and also studied engineering), but after a year, he had

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EXCELLENCE to drop out. “It didn’t go so well,” he says. “I struggled with maths, didn’t pass physics – I only passed two out of six subjects.” He and his brother went back to Umtata, and after a year of considering options, their mother enrolled them both in a Marketing and Business Management Diploma at Damelin. “Bless her soul, our mother always believed in us,” says Bongani.

“You get good exposure at a smaller firm.” During that two-year diploma at Damelin, Bongani found that he excelled at accounting, which was one of the subjects. So, he started to do some research to find out what he could do with it. This was how he became aware of chartered accountancy as a profession. When he finished his diploma, Bongani started his undergrad at the University of Transkei in Umtata. And his brother went along with him. He then applied for a bursary from the National Research Foundation to complete his Honours at the University of Durban Westville, and also applied to KPMG in East London. They said that they would take him, if he did his Honours first.

Recruited by Nkonki While doing his Honours, there was a graduation ceremony for the undergraduates at the University of Transkei. When he went up to collect his certificate, all his distinctions were listed, and Siphiwe Sithole, who worked for audit firm Nkonki, took notice. She approached him after the ceremony to ask if he’d be interested in coming to work for them. Since he already had a place at KPMG, he said he’d think about it, but after she flew back down to Durban to meet him again, he was convinced. He started his articles at Nkonki in Johannesburg in 2005. “Those three years were very important as far as my development was concerned,” he says. “You get good exposure at a smaller firm – looking at audit, revenue, costs, payroll at your clients, as opposed to if you’re at a big audit firm with a big team, you don’t get exposed to all aspects of a particular business.”

Pursuing a career After he completed his articles, he stayed at Nkonki for another 18 months, and then joined the Hans Merensky Group – which owns Westfalia – where he's been for 10 years. He started out as group management accountant for Merensky Holdings, and was then promoted to his current role at Westfalia Fruit Africa. “I have reported to Rian du Toit, our CFO, since day one. He’s someone I respect a lot. He’s always had faith in me, supported me and been good to me. He’s challenged me, but always been true to his words whenever we’ve had discussions or I’ve had questions,” Bongani says about the Hans Merensky Group CFO, a nominee at the 2018 CFO Awards.

“I relish the opportunity to groom a person.” In his current position, Bongani lists his challenges as ensuring the proper functioning of systems, processes and controls to provide accurate and timeous information for reporting, forecasting and decision-making. He also focuses on liquidity management and working capital optimisation, and change risk management. And he ensures that the finance functions are adequately resourced with people with the requisite skills to provide a quality service to the business, while also building succession.

Pursuits, pride and passion Sport is his biggest out-of-work interest and pastime. “I used to play soccer and cricket, and a little bit

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of tennis as well. Now I mostly just enjoy watching – especially football. I am a big Barcelona fan and in South Africa, I support the Orlando Pirates.” In addition, Bongani says that he also enjoys reading financial publications and self-help books. He is now married to Labesutu, whom he describes as “a blessing”, and has two daughters Langalethu, who is nine, and Kwanda-Okuhle, who is five. “They are my pride and joy.” He says that they have taught him lessons in patience. “You work long, hard days sometimes and when you get home, you’ve got these little people that just want your attention running up to grab you because daddy’s home. I can’t say I’m tired or I’ve had a rough day. I have to make the time for them.” He hopes that this has made him a better boss. “I enjoy dealing with people, and I am generally patient. I relish the opportunity to groom a person, help them to improve and help them to become better versions of themselves. I enjoy the people aspect, and as with my kids, I try to engage with them, but to give them their space to be able to voice opinions and talk about whatever issues they have.”

“I think I have something of a rebel in me.”

When asked what he’s learnt on his professional journey, one of the things he’s proudest of was starting over when things didn’t work out at UCT. “The lesson was that just because you’re not good at something, doesn’t mean that there’s nothing you can be good at. Be open to changing direction and finding your strong points, and then, when you do, make the most of them. I can look back and say that it’s not been easy to get here, but I am proud that I am here.” He adds that he hopes that the people who work with him have learnt from him. “I believe that I have impacted them positively. And the business itself has grown tremendously since I have been here, and I would like to believe that I contributed positively to that development. I could never claim sole credit for what happens, because we work as a collective, but I would like to believe that my contribution helped to point the company in the right direction.” Bongani says that the next step for him would be to be the CFO of a leading South African organisation. “I would like to see that happen in the next three to five years – I believe I’ll be ready for that challenge.” His brother, who also did his articles at Nkonki, now works at the Auditor-General. “I am proud of him. He’s doing well for himself,” says Bongani. “Maybe he’s the next AG in the making. I certainly think he has it in him.”

The distant future While Bongani’s ambitions will certainly keep him in the big city for the time being, he says that he misses the rural lifestyle. “I’d like to live in a place like East London – not too big, and you can still get out to the countryside. I like my peace and quiet. The big city has its conveniences, but once one has made one’s millions, he will most likely retire to a small town.” While Bongani might be hearing the call of the countryside, he has plenty of years to express his drive and focus before retirement, peace and quiet becomes a reality. l

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XX RISK

THE PROBLEM WITH YOUR RISK REGISTER…

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“We, as business, are sometimes superficial about risk management. As much as we value the risk register, we like to keep it tidy and clean. We don’t like to poke the bear. But we need to say: this is the risk, this is what’s bringing companies down. It is not interest rates exposure; it is bad bosses, bad decisions and whitecollar crime. We need to be hard core and tackle the real risks, not just the fluffy stuff.” Thobeka Ntshiza speaks to senior editor Toni Muir about the truth and lies of risk management.

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The latest scandals of Steinhoff and KPMG had nothing to do with interest rates risk exposure or currency risk, they were due to lacklustre management,” says Thobeka Ntshiza, finance director of Barloworld Logistics: Supply Chain Management.

Thobeka, who joined Barloworld in February this year from Aveng Infraset, fervently believes that business needs to be brutal when talking about risk, or we can forget about driving change. “We never include bad management on the risk register. But that’s the reality,” Thobeka says. “Often management is not truthful,” she continues. “There’s a saying about speaking truth to power."

Education While there’s plenty of talk around managing interest rates exposure, currency exposure, cybercrime, macroeconomic factors, and socioeconomic factors, Thobeka argues that everybody skirts around the genuine issues. “Don’t just list socioeconomic factors, be specific, say that our education system in South Africa is in trouble,” she says. “With the state that it’s in currently, where are we going to find talent in the next ten to 20 years? Most of corporate South Africa is far too quiet on this. Yet, the adverse impact that this is going to have on business in the next ten or 20 years is huge.” Education should concern anyone doing business in South Africa right now, Thobeka says, because it directly impacts the talent pool that businesses are going to be selecting from in the near future. “We are already in the fourth industrial revolution. And in that space, there’s not much need for people who can do transactional or man-

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ual type of work, as technology can only take over a lot of that. The future needs problem-solvers and producers of solutions. But we aren’t teaching our kids and our graduates to be problem-solvers.”

Social media Thobeka says she recently undertook an exercise where she gathered feedback from various social media platforms, including Twitter, Facebook and LinkedIn, to get a feel for what conversations were happening. The results surprised her. “What people are talking about versus the risks we list are completely different. On social media, we talk about education, corruption, unemployment, health, and the prohibitively high cost of data,” she says. “We talk about the Gini coefficient in South Africa and how the gap is growing bigger every day. Companies in the FMCG and retail space should be worried – who’s going to buy their products if people are getting poorer?” Thobeka believes that risk is in the eye of the beholder. “If you take, for example, the SABMiller transaction, a person domiciled in Germany or Singapore, versus a person sitting in South Africa, has a very different perspective on things. This influences the country risk rate they give. A person in Singapore will likely perceive South Africa as high risk, and choose to avoid it, whereas someone like me, who has done business in South Africa for years, has a different perspective, and perceives the risks as low. Now, this isn’t to say that South Africa is entirely without risk, but two shareholders coming at it from different perspectives will assign a different value. I think this is important to remember.”

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THOBEKA’S BIG RISKS “Professionally, changing jobs was a leap of faith and the biggest risk I’ve taken in the last 18 months. But I haven’t looked back. I’ve been very fortunate in my career. Before I started at Aveng I was with Coca-Cola. Even then, I didn’t look back once I decided to move on. For each new path I take, there’s a purpose I want to achieve. Once I do, I can move on to the next challenge. I’m not risk averse, but I am patient.” “I wasn’t actively in the market or looking for a job, but when the headhunter called and pitched me the Barloworld Logistics role, there was just something about it. I’d been with Aveng Infraset for six-and-a-half years. Manufacturing centres on tangible, clearly defined outputs, and it’s very transactional. Supply chain presented an exciting opportunity for me because there are so many moving parts. It’s conceptual, it’s about solutions, it’s a more intangible concept. You have to think differently and devise solutions specific to the customer’s needs.” “Personally, juggling a career and motherhood. I have twins aged five, and a nine-year old. It was a risk choosing to juggle these two full-time jobs. It’s been hard. I’ve had moments where I feel awful because I arrive home at eight in the evening and all I’m able to manage is giving them a goodnight kiss. But, in terms of fulfilment, they get the best of me because I’m happy. I love working and I love my career. That gives me purpose. Because they have a purpose-driven mom, I can naturally translate that into how I parent. When I’m at work I’m present, when I’m home with my kids, they have all of me.

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While there are numerous valid and quantifiable ‘big’ risks, businesses in South Africa need to carefully consider which of those risks are applicable to their organisation, given the space in which they play, Thobeka says, and then they need to personalise it. “Out of a list of the top ten, probably only two or three are critical to any one organisation and likely to significantly affect them. Once you’ve personalised it, you should consider what you need to do today to mitigate that risk going forward.”

Re-earn credibility Asked what she thinks some of the most pressing issues – or risks – currently facing the finance industry are, Thobeka pauses before answering. “We have to re-earn our credibility as finance professionals,” she says somewhat dejectedly. “As CAs, we are guided by a code of ethics and professional conduct, and the fact that there are a few people who have misbehaved doesn’t mean we all have. Unfortunately, it only takes one or two big incidents for the spotlight to be cast over everybody in the profession. There’s a stigma now, and we’ll have to work hard every day to re-earn our place in society and in business. I make it my mission that when I walk out of here each day, people say there are still good CAs out there.” Thobeka sees the finance exec’s role as a financial custodianship. However, she says, it’s about more than just the numbers. “Finance people need to get up, get away from their desks and out of their offices, because that’s not where the action is. I think finance needs to get out more and be integral in the business and the operations. The more you do that, the more you create a trusted partner,” she says. In so doing, she adds,

you’ll find that many of the discussions and solutions are not happening in the boardrooms, they’re happening everywhere. “You’re out there in operations, talking to people, and can experience first-hand what the challenges and strengths are, and learn of any new things. If there are new initiatives, you journey with them,” she says.

Present and available You need to move to being integral to the business, Thobeka says. “If they see you are interested, present and available, they will bounce things off you more and more often. This is what I bring into my role at Barloworld Logistics – I’ve sat with all the GMs since being here and they’ve talked me through their businesses. I don’t know if it’s because I’ve taken an informal approach, but I’ve never been met with resistance. People want to talk about their business. And by doing this, by staying in tune with what’s going on, people bring problems to your desk before they show up in the numbers. That’s what you want. You don’t want to find out post-event. That doesn’t drive the business forward, that’s damage control.” What finance needs is to move away from thinking purely finance to thinking business, Thobeka says. “Aveng Infraset groomed this thinking in me. Finance is your core discipline, but now you need to think business. This mindset allows you to be the finance person who can give a greater value add to the business. If you’re going to continuously report the past, you’re strictly a finance person. If you can look ahead and focus on what’s new, then you’re forward-thinking, and that’s what business needs.” l

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RISK

QUESTIONS FOR ANDREW MCMASTER Toni Muir chatted to Andrew McMaster, FD of Coca-Cola Peninsula Beverages (PenBev), and encountered a fascinating personality who wanted to be a chef, but became a finance boss who talks from the heart.

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How did you first get into finance? Was this always the plan?

“Hell no! (laughs) My father was very enlightened. I had a pretty chequered schooling career and visited the headmaster a little too often. I wasn’t sure what I could or wanted to do. My father said to go get a “proper” degree before I became a surfer or a beach bum. I had the opportunity to go to Australia on a Rotary exchange. By the time I came back, I had been accepted to do business science at UCT or architecture at Wits. To do architecture, I had to have a portfolio, which I didn’t have, so I chose business science.” “Finance wasn’t specifically my chosen career, and I fell into doing a CA the hard way – my dad pulled the financial plug on me and said good luck my boy. I had no choice but to get a job. I bought the cheapest, shiniest suit I could find, walked the streets of Cape Town and eventually found a job with one of the auditing firms. They sent me up to George and I started studying through UNISA. In truth, I probably would’ve liked to be a cook, but everything happens for a reason. Being a chef, that’s something that was never on the cards for my generation.”

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You’ve been with PenBev for close on 22 years. How different are things today from when you first started?

“I remember when I first came here, we had a culture of incredibly long service, and we celebrate this every year with a long service award ceremony. I used to sit there thinking, these people have been here longer than I’ve been alive. I thought they were crazy. But here I am 22 years later, and people are looking at me thinking the same thing!” “As much as things change, so they stay the same. I think what endures is the critical things that make a difference. Our culture is everything that we believe in here, and it has grown and evolved, without a doubt. It was a family-run business, and that has meant we are more inclusive and more empowering. Our business is about people, and this has remained intact.” “If you boil it down to the fundamentals, those have remained the same: people still want a refreshing cold drink, dealers still want to make a buck by selling our product. The customer is perhaps the one aspect that has changed. Likewise with the weighting of relationships, particularly with the growth of certain retail chains. However, if you stick to the fundamentals, those shouldn’t change too much.”

What do you consider your most noteworthy achievement over the years?

“I would like to believe that the biggest thing I’ve created is a team of people who have grown and developed while they’ve been here. I like to cultivate financial maturity across the business. This is something my team and I have developed over time, across the organisation, as opposed to us ensuring everyone is sticking to what they need to do. They’ve married their operational performance with their financial performance. That maturity has been quite good.” “I’ve also strengthened the planning process and taken that to another level, a world-class level. We execute our business planning cycle with excellence and this is something of which the team can be proud.” “With regards to our systems and processes, ensuring we have timeous, accurate and relevant IT systems has been very important to me. We put SAP in ten years ago and it’s made a huge difference. I think we’re a considerably better company for this because it gave us a great way of looking at our business. We’ve embraced it well.”

What is the most significant thing you have learnt over the past year, in your role as FD?

“We are very strong on culture and have done culture value assessments, as we really wanted to take this to the next level. So, as directors, we took a trip to America two years ago to go and look at culture. We found some incredible culture there. Philadelphia, for instance, has an incredible sense of community. In St Louis we met an engineering business, by the name of Barry Wehmiller, that comprises 70 smaller businesses from around the world. They started their own internal ‘university’. It was voluntary. We have, with them, started our own university here. We opened it earlier this year and I was lucky enough to be on the first course – ‘Listen like a leader’. Wow, what this course taught us about listening, empathy and understanding people, and being able to help people overcome their fears, has been the most powerful thing for me. Being able to let that flow out of me and embed it into the business is something I want to do.” “Also, one needs a serious challenge or headwinds to find out if your team’s fundamentals are well galvanised or a bit loose. It’s been incredible to see, with the sugar tax, how well the whole beverage industry can pull together and do the right thing. I think there will be some very positive things that come from this.”

How does Coca-Cola Peninsula Beverages fit into the Coca-Cola Beverages SA landscape?

“We cover the Northern Cape and a large chunk of the Western Cape. So yes, while we are a separate entity we are still a part of the broader Coca-Cola team in South Africa.” “In the Coca-Cola system, some of our pioneers were very interesting people, very colourful personalities. There’s a lot of history that goes back many years. What we are doing today is building on the incredible work that has been done by these legends. Whether we are one homogenous entity or a few separate parts, we’ve still got to work together. Being relatively small compared to Coca-Cola Beverages South Africa, we can do things differently and at times be more flexible. Things like innovation are easier for us.”

In your opinion, what is necessary for successful ‘big picture’ thinking?

“One has to have context of the environment that you’re in – the micro context, the macro, the world, brands, trends, etc. Part of this context is understanding what your own purpose and vision is. We have become very clear on what our purpose is in the world. As a finance person, I’ve always stayed clear of talking about profit. I talk around this. I think, if your purpose is talking to

something slightly greater than your day-to-day function, and greater than just making a profit, this drives you.” “Your vision has got to talk to this; you’ve got to experience the journey. If you know where you’re going, you can take diversions along the way, as long as you have the context of where you’re going to end up and what you’re going to encounter along the way. Also, having empathy is so important – for what you do, the people around you, other stakeholders. If you understand what they need, that helps you deliver the big picture.”

What makes you an effective leader?

“I run a team of around 65 people in the group, and look after finance, admin and IT. I have three direct line leaders who report to me (it used to be seven). Effectively, it’s better to have four to five at most. Then I’ve got about 150 people in the broader business who are involved in admin and information services. I don’t get daunted by the number of people because the focus is on how we structure things so that people understand what they need to do. The message to them is relatively clear.” “Being an effective leader, time is your gift or your enemy. If you can create time to be with people and to hear people, that is probably the essence of effective leadership.

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Using that time effectively is really important, as is being able to communicate clearly. Being able to get people to tell you what they need efficiently is important, and trust is a key component here. I like to believe that I look at life relatively simply and clearly. I like to boil things down to simple items; break things down into relatable ways.” “In my area, which is relatively compliance-oriented, l like to talk about keeping the castle strong. I have a picture of a castle that I share with everybody. It’s got five pillars. I basically talk about these all the time: firstly, the process, systems and controls, secondly, the reporting side and thirdly, decision support, and building this on teamwork and shared values.” “I also encourage people to do the right things and to do the basics brilliantly. If you do that, you get most things right and will generally come out winning more often than losing.”

How do you get the best out of your team?

“You need to have a bit of a whip, a bit of a carrot. I am quite tough. I like people to do things properly. I suppose I set very high standards. I’ve tried to instil pride in people, and a desire to be the best. I realised a few years ago that with my very high standards I probably hadn’t recognised this in the team – and you must recognise your people when they do stuff well. It’s amazing how trust builds confidence to grow and do better things. I wish I’d known this earlier on in my career – to trust people and show them

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that you trust them, because this allows them to go on and be the best that they can be.” “I encourage my team to get out there and get into the business; to talk to people. They’ve got to know what is needling people, and you only find this out by talking to people. So, I encourage them to get to the real root cause of the issue; to scratch below the surface.” “I find, when talking to people, you need a mantra, a sentence that you can build your story around. That’s fundamentally important. I use simple mantras with my team; for example, our role is to ensure ‘financial stability of the business by reducing risk’.” “I am also a serial planner. I drive my wife absolutely dilly, because I spend all my time planning. But I believe if you plan and understand what you need to do upfront, your chances of success are so much better. I also like change a lot. Every year I try to change the angle or the dynamic just a little bit. That drives me because I need change; I need that energy.”

Where do you see yourself five years from now?

“I would hope to have in place the next generation of leadership in this business; to have ensured the business is in a good space to hand over. I will probably then be considering handing over and going into something more people and environment oriented.”

Tell us a bit about yourself outside of work.

“I once described my wife at one of her birthday parties as being someone who needed her crayons – her friends – around her because they add colour to her life. She said I’m the one who needs crayons. I do need people around me, but a variety of people – I thrive on people’s energy. Growing up, I had a fascinating mother and father. As a family, on holidays we’d sit around the dining room table with lots of different people popping in and out. We’d all sit and talk about all sorts of different things. I always had a voice at the table. So, debating things in life and having the ability to talk to people is important to me.” “I need my ‘me time’, and that’s where I use running on the mountain and exercise. Exercise is my time for me; the time where I get my own energy and my own flow. I also read a lot. I’m a terribly slow reader and a bad reader. Currently, I have ten books next to my bed. But I don’t read what everybody else is reading.” “Other than that, I love eating and cooking and sitting around a table talking to people. My two kids are at the point where they bring their friends home and I love talking to them and hearing what’s impacting their lives. I also enjoy travelling with friends – we have some friends that we travel with every year. We’ve done a few sailing trips. We like doing different things; getting out there and experiencing the world. I try not to be too much of a conformist.” l

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Justin Diedericks (Deloitte), Andrew McMaster, Angus Cornelius (both PenBev) and Kassie Karstens (Deloitte)

Andrew McMaster (PenBev), Ronel van Dijk (former Spur) and Reeza Isaacs (Woolworths)

CFOs discuss risk and reputation Do the right thing. That is the best way to enhance, manage and protect the reputation of your business, said award-winning Woolworths CFO Reeza Isaacs during a powerful CFO Summit discussion in Cape Town.

osted at Deloitte’s offices in Green Point and co-sponsored by Standard Bank, the well-attended event on 15 March 2018 brought together a select group of the Mother City’s most passionate finance decision-makers to share insight, learnings and concerns surrounding the event’s topic, Reputation: Why the CFO Matters Most.

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“Reputation management should be at the top of the list of a risk register now more than ever,” said Ronel van Dijk, outgoing CFO of Spur. She was a panel speaker at the event, along with Reeza and Andrew McMaster, CFO of Peninsula Beverages. Ronel said that social media has brought with it more opportunities for the public to tarnish a brand since users feel empowered to post about a com-

pany while hiding behind their tablets or computers. None of the panel members shied away from the elephants in the room, with Ronel giving insights in her role during last year’s violent ‘incident’ at a Spur franchise, Reeza illustrating the way Woolworths tackled issues around listeriosis and the David Jones acquisition, and Andrew talking openly about

Jennifer Devenish (Table By Cold Storage) and Mnwana Kambule (SizweNtsalubaGobodo)

Ruhan Neethling (Montagu Dried Fruit & Nuts), Lara Rabiu (African Leadership Academy) and Dan de Villiers (Fruitways)

the challenges and opportunities around the sugar tax and ever-increasing health concerns.

In good times… When opening the summit, Dr Tim London, senior lecturer at UCT’s Graduate School of Business, said there were two factors to proper reputation management: values and rigorous processes. Values, he said, should be aligned with what’s most important in an organisation. More importantly, he pointed out: “There’s a difference between the values you put up on the wall and those you live in an organisation. Every organisation has values but unless they are built into your organisation, it’s just a PR exercise.” He suggested they be built into an organisation through its structure, culture and people. Similarly, Tim said a company’s processes shouldn’t just be found in a handbook and presented for auditing purposes (formal) but should reflect what really happens on the ground (informal).

According to him, the easiest part of reputation management for a CFO was managing themselves. The biggest challenge was creating an environment in which everyone else knew what was important. According to Andrew, a company’s values should be reiterated and celebrated at every opportunity. “Our MD talks about what we do all the time. Good leaders repeat the values again and again,” he added.

And bad… Reeza referred to Warren Buffet’s sentiment that in a large corporation someone, somewhere was doing something they shouldn’t. “It’s incredibly difficult to manage everyone,” said the Woolworths CFO, who was elected CFO of the Year in 2016. Andrew said CFOs should be walking the talk for what they believed was right for the company for the ethics and values to be embedded in a business. This, he added, would have a filter-down effect.

Pardon Mutasa (Green Building Council SA)

Ronel agreed but added that on top of “walking the talk” leadership should also be unforgiving. “Anyone who’s not upholding the company’s values must go. That’s how you build a business community with the same values.” She said that, as gatekeepers of corporate governance and the like, CFOs had a responsibility to speak up and point out incidents in which things weren’t done correctly. Reeza said there was also a responsibility to shareholders to protect a company’s reputation, which was why it was vital for CFOs to raise concern should they encounter something that didn’t sit comfortably with them. Ronel added: “We’re in a unique position as we know the business best, second only to the CEO. We’re uniquely positioned to identify where there are issues. We don’t have to have sight of every little thing, but we have insight on everything.”l

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Why Deloitte’s Rushdi Solomons likes purple CFOs

Rethinking internal audit “The CFO has to rely on an internal audit function that is also tech-enabled, data-enabled, and business-savvy.” By Kate Ferreira

ushdi Solomons is a partner who heads up internal audit services for Deloitte Africa. Internal audit is a function that he believes can add immense value beyond the “tick box” reputation that perhaps still persists. But, he admits, that’s a view he also had to come around to over time. A CA by training, Rushdi took the “traditional route” at the start of his career. He quickly realised, however, that he wanted to contribute to more than the “financial bottom line”. He joined the Auditor-General (AG) of South Africa, where he was involved in a team that focused on value for money within the ser-

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vice delivery functions of broader government – essentially, how government can really make a difference and have real impact on the lives of citizens. From here, he was attracted by Deloitte because of their advisory focus in both private and public institutions driven by the purpose of “making an impact that matters”. He took the leap and joined Deloitte in the Risk Advisory business, quickly working his way up to heading the internal audit unit. The career shift came with some self-initiated training, including a Certified Internal Auditor qualifica-

tion. Here, the true definition of this function was really drilled home for him. “Internal audit is so misunderstood,” he says, “It is an independent objective assurance and consulting/ advisory activity, primarily designed to add value and improve an organisation's operations. We can advise businesses on how to improve their organisations – and that's the area in which internal audit can really prove its worth, but it's not used very often. Management and particularly boards default to just the assurance mandate. ”

Fixing the “broken” triangle Rushdi believes that the internal audit activity functions best as one point of a triangle, along with

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the CFO and the audit committee or board. “But the triangle is often a broken one,” he says, “and internal audit can be disempowered by a short-sighted committee or CFO. If you’re hindered in this role, with a directive to focus only on internal financial controls assurance and nothing to either side of that spectrum, it diminishes the value of the function.” When the triangle works best, Rushdi says, internal audit is able to balance the aspects of value protection and value creation. “This is the role that the internal audit of the future will be well placed to play. Internal audit will position themselves as the instrumental supporter of a ‘purple CFO’.”

Pure purple A so-called purple person – a concept defined by business intelligence thought leader Wayne Eckerson in 2010 – is one who possesses that in-demand mix of both business sense and technology skills. Rushdi believes that CFOs will increasingly need to be or become purple persons, and that internal audit functions should be shooting for that mix too. “Becoming this is a journey that the CFO should be on. And in that journey, the CFO has to rely on an internal audit function that is also tech-enabled, data-enabled, and business-savvy. With all the things a CFO has to deal with, this might not be top of the agenda, but it should be part of a plan for the future.”

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Rushdi says that tech is already fundamentally shifting both the day-to-day business and internal audit function. Machine learning, AI and data analytics mean that auditors can crunch through large sample sizes (even full populations), be more proactive in spotting inconsistencies that could point to risk, and essentially audit by exception. “With continuous controls monitoring and assurance, the internal audit function is more insightful and we are able not just to see trends but predict them and understand them. Spend analytics reveals the true behaviour of transactions in your business, beyond the processes that are designed to govern behaviour. Using data analytics quite extensively to support internal audit, the CFOs, and management teams are no longer ‘nice to haves’ but ‘table stakes’ for us. AI, robotics, machine learning, and other elements of the fourth industrial revolution including crowdsourcing, are also not ten years away, but are already implemented in part or as pilots.” In essence, he argues, this data boom is shifting internal audit beyond seeing control gaps and deficiencies, and towards being truly value-adding business advisors – in addition to the risk lens that it already applies to the business. With a solid relationship in place between internal audit and the CFO, this creates possibilities to be more agile, and to grow the business with full view of the value chain across the business.

Walking together “Where I’ve seen this work best is with CFOs that have an appreciation for the full landscape of risk, and how the world has changed. They appreciate having as many individuals as possible having the necessary conversations, and looking out for the business. Once they see the scope and breadth of the internal audit function, they expect the internal auditors to walk that journey with them.” He continues: “Some CFOs actually say internal audit should be able to provide a return on their investment. Be it an in-house function or an outsourced function, they should be able to pay for themselves in perhaps how they help save the business money, or how they provided for operational efficiencies, or even how they enhance the way in which the business is doing things and unlocking opportunities. A typical example, Rushdi says, will be picking up deficiencies in the contract management system, and being able to engage with the CFO on what better systems there are in the market and what functions this needs to fulfil. Thereafter, however, it’s up to the business. Internal audit can’t make management decisions. “This means walking a clear but fine line, because you always need to be independent and objective. But you need to ensure that when you're doing reviews, you're doing it from the perspective of how you're going to help the business.” l

Loveness Khunou (Dow Chemicals)

Jurgen Prange (BBEnergy)

Marble restaurant

CFOs get energy-savvy Leading CFOs gathered for dinner at the exquisite Marble restaurant on 20 March 2018 to share insights and experience around the topic of energy efficiency.

“

Energy efficiency projects are absolutely worth it and can improve profitability and preserve scarce energy resources,” said SibanyeStillwater CFO Charl Keyter, one of South Africa’s most eminent finance leaders. “With the 12L incentive we have returned significant value to the business and the bottom line. It’s far from fuzzy maths in our world.” With leading energy services company BBEnergy as a sponsor, the Johannesburg dinner made for a high-quality and intimate conver-

sation between finance leaders. How can CFOs become more energy-savvy? How do businesses make sure they don’t leave money on the table? All these questions and more received attention over a scrumptious multi-course meal.

our electricity consumption by almost 20 percent through continuous improvement initiatives. Of course, global commodity cycles and Eskom’s reliability and cost challenges have forced this issue but it’s ingrained in our DNA as a business”

Improvement initiatives

With CFOs all at different stages in their energy efficiency evolutions, the conversation was dynamic and practical. Loveness Khunou, CFO of Dow Chemicals, was the first admit that they are in the early stages and asked the other guests about how to build cohesion towards these

After a 23-year career at SibanyeStillwater, there is very little CFO Charl hasn’t seen or experienced. “We’re a top-10 Eskom client and our business relies on increasing efficiency to ensure the best returns. Over the last decade we’ve reduced

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Tshego Sefolo (Agile Capital)

“Buy in at the very top is essential – without it you may as well not even start. This can’t be an effort driven by finance or engineering alone” noted Charl, when queried by CFO South Africa MD Graham Fehrsen, who hosted the dinner with the newly appointed CFO community manager Liezl Berry. With an impressive 18-year career at Afrisam, CFO Awards 2018 nominee Leon Serfontein was in full agreement, “We have multi-disciplinary teams that lead these projects and I stay close to all of them, but it has to become part of company culture”.

Consultants The conversation then turned to consultants – every CFO's bugbear – and risk-based engagement models. “This is a non-negotiable in our business, said Pushpender Singla, CFO of Vedanta Resources and another nominee for this year's CFO Awards. "Any consultant that has a proposed solution must be prepared to have skin in the game and back their expertise to move the needle on our baseline measures. Without this, we won’t even start an engagement.”

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Charl Keyter (Sibanye-Stillwater)

BBEnergy director Jurgen Prange and Tshego Sefolo, founding CEO of investor Agile Capital, brought their own unique insights into the discussion, with CFOs keen to get another expert perspective. “Once organisations see the benefits of the savings they tend to move towards pay per outcome or project models, probably feeling that they give too much away in pure risk/ return models,” said Jurgen. “Our experience shows that this often leads to a slippage in the efficiency and I’ve lost count of the number of times we’ve been brought back in to help reset some of the simple behavioural practices”.

Alternative energy With the 12L rebate window expiring in 2020, there was some debate about whether there would be an extension. Much will depend on whether Eskom’s additional supply will come online soon, which the experts around the table agreed would probably be the main factor in the extension.

Either way, there is no time to wait. If your organisation is making a move towards improved efficiency and alternative energy sources, it is only a matter of time before global pricing parity comes to bear on Eskom’s pricing and adds even greater costs to business. All the CFOs admitted that their organisations were looking at alternative energy sources to bolster their consumption. l

Leon Serfontein (Afrisam)

Pushpender Singla (Vedanta Zinc International)

TIPS

for energy saving from Sibanye-Stillwater CFO Charl Keyter

Get your executive team to understand the strategic importance of energy efficiency rather than seeing it as a project.

Take your first step as soon as you can.

Partner with reputable organisations and share risk. You’ll never have enough knowledge or capital to do it all yourself.

Keep the payback and implementation periods as short as possible, maximum two to three years. You’ll keep everyone honest and help your organisation make significant strides.

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CFO career paths off the beaten track

CA(SA)? NOT the only way In the CFO world, it’s no longer a case of “CA or the highway”. In fact, a number of other qualifications are preparing professionals for the role just as well, if not better. By Georgina Guedes

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Jonathan Murphy (Big Concerts)

Lars Fischer (Michael Page)

“

South Africa is a little too CA focused,” says Roy Clark, the managing director of Clarkhouse Capital. “The world is changing and there’s such a migration in finance as well – data analytics, MI, big data and AI are going to become such key components – reporting on numbers will be almost 100 percent automated in future.” Roy says that the technical aspects of finance will be looked after by systems and processes. “Finance teams will be reduced, and the management function will be more about partnering with the business. You don’t need a CA for that.” He believes that quants and actuaries are the people that organisations should be recruiting for their finance areas or for the CFO role. “And CIMA and ACCA are good – they add a different perspective.”

ing that South Africa is still very fond of the CA qualification. “It’s a great entry into the finance sector in general, because employers know that candidates with a CA qualification have been through the necessary tests and exams and have had the right exposure. But it’s only an entry into the sector and everything else happens from there onwards.”

their CV and is further established in the conversations that we have with them as recruiters and then share with our clients.”

Five out of 14 In the last 15 months, Lars' firm has placed 14 CFOs or finance executives, and out of those, they placed candidates without a CA title in five positions. He says that the remainder had honours or masters in accountancy or held CIMA or ACCA qualifications.

“CIMA and ACCA are good – they add a different perspective.”

Lars Fischer, the operating director at recruitment company Michael Page SA, echoes Roy’s view, say-

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He says that those who go on to become CFOs work their way through the ranks of the finance organisation, usually from being financial or management accountants or finance controllers to finance managers to heads of finance and then CFOs. “It’s more about the exposure finance professionals have had during their career and how they adapt to challenges. This usually reflects on

Georgina Barrick, managing director of Cassel & Co, points out that there is no specific requirement that states that a CFO must be any kind of accountant at all. “It really depends on the size of the business and the role requirements,” she says. “Listed companies want a CA to sign off on financials, but in Pty Ltds, it is not necessarily essential.” She explains that if the role is highly strategic, supporting the board and the CEO, a CA would

appointed to his current position. He says his actuarial background has benefited him significantly in his current role. “The actuarial syllabus is obviously a broad one that includes at least basic courses in accounting, economics, finance, law, strategy and marketing, so it shares a lot of fundamentals with going the CA route,” he says. “Obviously the more advanced courses on accounting and finance are replaced with mathematics and statistics, but at least the basics are there.” After obtaining his actuarial qualification, he also

“The irony of my route is that I find a lot of the things easy that other CFOs struggle to get involved in.” Roy Clark (Clarkhouse Human Capital)

probably be preferred, but if the role is more operational, organisations could employ the services of a non-CA. She says that while most of her recruiting clients request a CA qualification, they often don’t know the difference between the different types of qualification, whereas generally speaking, a B.Com, B.Compt or MBA, or ACCA or CIMA registration will do just as well. Among South African CFOs, it is not unusual to also encounter LLB or actuarial qualifications.

An actuary, actually… Risto Ketola, the CFO of listed financial services group MMI Holdings, and a fellow of the Institute of Actuaries and CFA Charterholder, describes his journey towards becoming a CFO as an “unusual one”. He started out in “quite a traditional actuarial manner” – first in life insurance product development, then involved in structured products or derivatives, followed by asset-liability modelling. He then made a change and became a sell-side equity analyst, and spent 15 years analysing insurance companies, which he says gave him an excellent view of the broader insurance industry and enabled him to develop a broad network of contacts across the industry. He hadn’t really considered becoming a CFO as his intended outcome, and only really started to think about the possibility a few months before getting

became a CFA Charterholder, which he says is useful for some of the required skills, such as corporate finance and risk management. “Still, the ability to operate at the level of accounting knowledge that is required for the role was pretty much all self-taught as a requirement to be able to function successfully as an equity analyst. I actually enjoy the purer accounting roles in my job – for example, staying close to the current IFRS 17 project.” IFRS 17 is the international financial reporting standard that was issued by the International Accounting Standards Board in May 2018. It will replace IFRS 4 on accounting for insurance contracts, and will be effective from 1 January 2021. When asked if he felt that his CFA was a necessity for someone working in his role in a financial services company, Risto answered that he believes it is more important to immerse yourself in the industry you are working in as a CFO. “It is important that the business units feel that the CFO understands the daily issues that the business deals with. It is also important to create the culture that the CFO understands the daily issues that the business deals with. It is also important to create the culture that Group Finance is in the ‘same foxhole’ as the operating entities. None of that us-and-them thinking!” As a non-CA CFO, he doesn’t see not having a CA as a massive handicap. “Obviously, I have to make sure that I have excellent accounting professionals in my team to complement the reality that my technical account-

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ACCOUNTING ing knowledge is not great. The irony of my route is that I find a lot of the things easy that other CFOs struggle to get involved in – group strategy, balance sheet management, investor relations, M&A – but then still have to rely a lot on other people’s skills in the more nutsand-bolts areas of my function – accounts payable, expense management, finance and IT – which I have never worked in.”

Seeing more CIMAs Webster Fanadzo is the acting Group CFO at parastatal PetroSA (although at the time of writing he was ending his tenure there) and is a qualified Chartered Management Accountant. He says that he opted for the CIMA route because it was more appropriate for his working environment.

while the CA route is more auditing and technical focused. I find that if one is working in business, there is more alignment from the CIMA route.” Webster also holds an MBA, which he says has broadened his business acumen. “The MBA expands one’s understanding of how business works, and enhances one’s interactions with the rest of the company,” he says. He has applied this insight into the various management roles he has held and initiatives he has led at PetroSA, including heading up the “Billion Plus” cost optimisation project.

audit stream, I’d be able to successfully navigate in an organisation, understand the auditors’ approach and speak the same language.” He says that the flexibility was also important to him, as ACCA is extremely highly regarded in the UK and globally, but that it was a benefit that he could work in a relevant role in any organisation, and didn’t have to spend time at an auditing firm. He then moved on to EDF Energy in a management reporting accountant role, giving him his first taste of working in a massive corporate. After nearly eight years in London, he returned to South Africa where he worked at Steenberg Accounting Services, an accounting and management consulting services company that served a number of countries in Africa. He looked after their Angolan operations in the FMCG space.

“Technology has brought on rapid change in all industries, so being adaptable and responsive to changes is crucial.”

“It adequately prepared me. I am not at all regretful about the route I took,” he says. “The distinction is that the CIMA qualification tends to be more commercial and business operations oriented,

Risto Ketola (MMI)

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ACCA gaining recognition Jonathan Murphy, CFO of Big Concerts, completed a B.Com at UCT, before moving to England without being sure exactly what his career aspirations were. He took on the role of accounts assistant at East Limited, a family-owned women’s clothing chain, but soon moved up the ranks to an assistant management accountant role. His manager suggested he do further qualifications, and after looking into CIMA and ACCA, he settled on ACCA because of the auditing exposure that it offered. “I didn’t want to limit myself out of audit, even though it wasn’t my ambition to work in that area,” he says. “I felt that with ACCA’s

After three years, he moved into the food division, and relocated to that division’s trading office in Malta for another three years. He spent his time there looking after entities in the territories, ensuring good controls and bank management. “At that stage, we’d been travelling for six years, so we started looking to come back to Cape Town and start a family. We took a chance and moved back with no jobs,” he says. He consulted while interviewing, and then took up a role at 24.com as head of finance and operations for a travel startup in the tech space, but after the departure of the general manager, he ended up taking on more and more of his departed colleague’s responsibilities. “I didn’t feel that I had completed my finance journey so I started looking to get back into finance,” he says.

Embracing change. Shaping futures. The ACCA Qualification – the future We’ve been building on our reputation of innovation and have developed a ground‑breaking design for our Professional level qualification. The result? The ACCA Qualification – the future. Our new revolutionary Strategic Professional level, combined with the innovations we’ve implemented over the past two years to the ACCA Qualification, ensures ACCA will continue to develop the strategic, forward-thinking professional accountants the world needs.

To learn more about the changes, benefits and updates to the qualification please contact us on:

E-mail: infoza@accagobal.com or Telephone: 011 459 1912

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In May 2016, he was appointed as the CFO of Big Concerts, which had recently been acquired by Live Nation Entertainment, a US-listed entity. The company, which had been a family-owned business for 25 years, was moving towards becoming more corporate and compliant with group policy for a US-listed entity. “Given my corporate experience, they thought I would be good enough to come in and set it all up for them,” he says. He spent his first year looking at compliance, getting the business in line with the group best practices, and says that since then, his role has evolved to a more strategic one. He is now also helping the CEO and chairman identify oppor-

tunities where the business can diversify. He says that not having a CA has not held him back in his career, but that he has found in South Africa that there is less of an awareness of the qualification, which is a slight drawback. “Most job requirements say ‘CA(SA) with five years of post-article experience’. But that’s changing. ACCA and CIMA have both done very well at raising awareness and now we’re seeing more job specs saying, ‘CA(SA) or equivalent.’

According to Roy, the most important skill CEOs should have is curiosity. “If you are not curious around efficiencies, effectiveness, forecasting and analytics, then that’s a skill or trait that’s going to be sorely missed in your portfolio. You can’t have the same, traditional thinking of the CFO, day in and day out. You have to have curiosity to be a future-fit CFO.”

Other qualities

According to Georgina, the strategic nature of the role makes certain demands on the CFO.

Of course, being CFO isn’t all in the accounting, and there are many skills and qualities that a successful professional in this role should have. Jonathan says that technical accounting ability is not the most crucial aspect of a candidate. “Long gone are the days when being a good accountant in terms of technical ability meant being a good CFO. In the modern environment, CFOs are relied on more and more to be business partners supporting the CEO or board in strategic decisions.” He believes that adaptability is now a vital trait given the current rate of change playing out in the payments environment, AI and accounting software. “Technology has brought on rapid change in all industries, so being adaptable and responsive to change is crucial.”

Georgina Barrick (Cassel & Co)

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so being able to communicate well really gives you a great advantage,” says Jonathan.

Good communication is another vital skill that CFOs need. “In leadership in business, you have to be able to communicate well, not just upwards, but downwards and laterally. CFOs are in a unique position where they have exposure to all parts of the business, and are working with all the departments,

“CFOs need to have good interpersonal skills, emotional intelligence and business acumen,” she says. “These skills are crucial for the success of the business, as the CFO connects with stakeholders, the executive team, project leaders and other staff members. The CFO acts as a trusted advisor to the executive leadership team, working as a sounding board where key decisions are to be made. They also need to be self-driven and have strong commercial acumen.” While CA(SA) is still the most natural starting point for a South African CFO, the range of alternative professions and institutes that prepare individuals for this job is wide – and rather than being a poor second place, many of these alternatives now offer skills that prepare a CFO as well – if not better – for the future chief financial role. l