My Life in Treasury
Alex Ashby, Head of Risk, Tesco PLC
Alex Ashby, Tescoâ€™s risk manager, has developed a wealth of experience and expertise in treasury and risk management in only eight years since starting out in treasury. Now as a senior treasury professional in one of the worldâ€™s most respected treasury functions, Alex shares his story so far, and offers advice to those embarking on a treasury career.
How did you come into treasury and what attracted you to the profession?
I finished my studies at the time of the global financial crisis, which was an interesting time to be looking for roles in the financial sector. As a maths graduate, I looked at a variety of different opportunities, which included the graduate recruitment scheme in marketing and trading at Gazprom. During my time at Gazprom, the treasury department was looking for maths skills, which is how I first became involved in treasury. Iâ€™ve never looked back since.
How did your career progress through to the role that you hold today?
I spent just over five years at Gazprom in a number of different roles across front, middle and back office, and ended up focusing more on middle office, including long-term forecasting and planning. During my time there, I started looking at risks in areas such as futures trading, and cash margin calls, and ultimately developed the treasury risk function. This involved working with senior management, building a treasury planning model, and developing the use of third party systems, including Openlink and SAP. Building a risk function was particularly challenging at that time given the rapid rate of growth. As a result, we were quickly outgrowing systems and processes, which gave the project considerable urgency and management focus.
I was approached by a recruitment consultant on behalf of Tesco, which was looking to set up a risk function. This was a fantastic opportunity, so I joined the business in 2014 â€“ at a challenging time for the company. Since then, I have built up a specialist team, and taken over the energy risk team that was previously part of the procurement function. The risk function is now quite substantial, with an enterprise-wide approach to global risk. I have also been involved in areas such as forecasting and governance, and about a year ago, I was appointed to head up a treasury transformation project with a view to overhauling our governance, systems and processes.
How have demands and needs in terms of treasury changed over the course of your career, and what particular skills does it now require?
The regulatory environment has become far more complicated since I joined treasury in 2009, and it continues to change fast. Furthermore, banks are at different stages of implementation: for example, some banks are now using up to nine different ways of valuing an interest rate swap, while others are only starting to implement now. Treasurers therefore need a strong regulatory mindset, with the ability and willingness to grasp complex implications, that may differ across market participants, and embrace a rapid pace of change.
Corporations have also become more aware of risk, and are becoming more motivated to manage it effectively. In particular, treasury professionals are looking to identify risks inherent in their business model, and embed risk awareness into the wider business. Â
Technology also continues to develop. We have used SWIFT for bank connectivity for some years, and this is becoming standard amongst large corporations, but there are a number of new innovations emerging. Blockchain, for example, may create opportunities for banks to work differently in the future, with an implication across the financial value chain, such as eInvoicing. With lots of different initiatives in progress, it is important to stay actively involved, or you can lose track quite quickly.
What qualities do you look for when you are recruiting for your department?
One of the first questions we consider when recruiting for a role is whether applicants need treasury experience or not. In fact, most of my team are not from a treasury background. As we have been inventing something new, bringing together experience from diverse disciplines such as insurance, energy, banking etc. can be very valuable. Depending on the role, people joining the team typically need an interest in the financial markets, and a relevant skill such as analytics, economics or maths; however, there are now lots of different roles in treasury, so diverse skills are often very valuable. People also need to be keen to learn: increasingly, treasury needs â€˜thinkersâ€™ rather than â€˜codersâ€™: a few years ago, for example, advanced Excel skills were often essential: today, this shouldnâ€™t be necessary and in fact, relying on spreadsheets and self-developed tools can create risks. Instead, people need to be able to understand, interpret and act on results, rather than simply producing them.
How important do you think a formal treasury education is, as opposed to (or as well as) more general finance or accountancy qualifications?
I studied ACCA and AMCT, and found them very valuable, and we have a wide range of different professional qualifications across the team. Treasury qualifications can be a useful addition to the CV, but much of the experience treasury professionals need is gained â€˜on the jobâ€™.Â