126: Matthieu Rivart

‘If you want to succeed, you have to be curious.’

Matthieu Rivart is the consummate CFO (SA), this Frenchman’s passion for Africa has enabled him to adapt with agility to business on the continent and lead teams across seven countries in Africa as CFO for Brands Consumer Group.

CIARAN RYAN: Today’s podcast is sponsored by Draftworx, which provides automated drafting and working paper financial software to more than 8000 accounting and auditing firms and corporations. CFO Talks is a brand of the South African Institute of Business Accountants. What a pleasure it is today to welcome Matthieu Rivart, who is CFO at Brands Consumer Group, and that’s a position that involves leading teams across seven countries in Africa and providing strategic direction to the CEO and members of the executive management teams. Prior to this, Matthieu was finance director at L’Oreal South Africa’s consumer division, and that’s L’Oreal’s largest business unit responsible for gross sales of more than R2 billion. Before that he was finance director for L’Oreal Luxury in Africa and the Middle East. He has a master’s degree in executive management and entrepreneurship, as well as a master’s degree in urban planning and another one in civil engineering. First of all, welcome Matthieu, I think we’re talking to you from Johannesburg today, is that correct?

MATTHIEU RIVART: That is correct. Good morning.

CIARAN RYAN: Good to have you on, that’s an interesting background you’ve got. You’ve got master’s degrees in urban planning, civil engineering and, of course, executive management. It just reminds me that there was a recent study done out of Europe showing that most of the CFOs in Europe come from non-accounting backgrounds. Now, when you started your career, it seems that your plan was not to become an accountant. Am I correct in assuming that?

MATTHIEU RIVART: You’re absolutely correct, you gave a perfect summary of my academic background and it’s true that through my academic background I was to become a generalist. I was not deciding to work in the accounting field, and I would say it’s actually a matter of life that I started my career in finance, I’ve been enjoying it and I’ve been in the field for 14 years. But yes, through executive management, civil engineering and, as you were saying, urban planning, nothing was really leading me to work in the finance environment.

CIARAN RYAN: Okay, so how did you end up becoming an accountant? You swung from urban planning to being an accountant somehow, what was the change?

MATTHIEU RIVART: So I started as a civil engineer, actually. That’s what I studied first and then I moved to urban planning because I wanted to discover more, to link a very scientific mind with a more literate mine. So I got two master’s degrees and after that I thought that before I start working, it would be good for me to have a background within economics in executive management. That’s when I moved to a business school and then I was ready to work. The first opportunity I had actually was with a KPMG in Paris, in France. So that’s where I started my career and where my career in finance was launched.

CIARAN RYAN: Very interesting. Tell us about Brands Consumer Group, that’s where you are CFO at the moment. Tell us what it does and give us a sense of the size of the business, if you can, in terms of revenue, staff and so on.

MATTHIEU RIVART: Sure. Brands Consumer Group, we are one of the leading FMCG distributors in Southern Africa. So we’re doing pretty much US$50 million a year, that’s from a revenue point of view. We’ve got over 600 employees in seven different countries. So we basically distribute products from customers like Nivea, Procter & Gamble, Lindt and so on, throughout Southern Africa through our different subsidiaries.

CIARAN RYAN: Okay and in terms of size, can you tell us a little bit about that?

MATTHIEU RIVART: Yes, $50 million a year in revenue, that’s what we have as a projection for this year. As I mentioned 600 employees, so quite a big entity.

CIARAN RYAN: How many countries are you covering in Southern Africa?

MATTHIEU RIVART: We’ve got seven countries, from Namibia in the west, South Africa in the south and up to Malawi in the north.

CIARAN RYAN: These brands that you distribute, these are not your own brands. You’re just distributing them on behalf of other principals. Is that correct?

MATTHIEU RIVART: Yes, exactly. We’re doing distribution, we’re doing transport and freight for these brands and we are also doing some merchandising in the field.

CIARAN RYAN: Tell us a little bit about what sales have been like and business conditions generally during this time of Covid lockdowns?

MATTHIEU RIVART: It was tough, to be honest, because we had to face the closing of the borders. So we saw a drop in our volumes last year. But where we were lucky is that we work in the FMCG environment, so we were treated as a priority and essential provider. So we managed to keep running the business, we didn’t deliver as per the budget but still significant growth there since 2019, and we are back on track with growth again.

‘You need to be a business partner when you are a finance person, especially in Africa.’

CIARAN RYAN: You’ve had considerable success in improving the company’s margins and profits in these difficult times and also in institutionalising the finance culture across all functions. Just explain how that was done.

MATTHIEU RIVART: So it’s two different topics but actually, they are linked. I would say there’s no secret, when you want to improve margin, you’ve got four leverage [points], it’s your price, it’s the customer [unclear] that you’re giving to your customers, it’s your cost of sales and the mix of product. So you have to work on these four parameters and you have to be very agile, I would say especially in an African context, where you always have to be very aware of uncertainty, inflation, volatility, devaluation of the currencies. So you need to be a business partner when you are a finance person, especially in Africa, I would say, because you need to provide financial input, financial insight to all the different stakeholders, such as the sales people, the supply chain, commercial, but HR as well. This is why I came to the institutionalisation of the financial culture because today’s business is becoming more and more complex to manage. So it’s very difficult for people who are not experts in numbers to manage their own business. So the role of the finance population, whether it’s a CFO, whether it’s a controller, whether it’s an accountant, it’s actually to tell a story about the reality behind the numbers. So one of the big projects I led when I was in charge of the finance of the consumer division at L’Oreal South Africa was actually to provide training to the whole population so that every business owner, whether it’s a brand manager or key account manager, would be able to follow and track the finance performance of its own business.

It was a complete change of mentalities because today I think in many companies you see people still thinking in a silo, where salespeople are just responsible to sell. But actually, when you look at the sales you might make, you might lose money on some deals that you do with the customer. So it’s very important for everyone to have this financial culture and that’s the role of the finance population actually, to spread that culture across the whole company. So really see that the financial roles as business partners. There are two ways of seeing finance, either you see finance as a back-office, you see what you did with the invoices, you deal with the customers and suppliers in the background.

But I see finance in the forefront, you’re there with the customers, you’re there with your salespeople, with your supply chain, like you’re holding their hands. You’re not there to make the final decisions, but you’re here to give them the best input so that they can take the best decisions.

CIARAN RYAN: I get the sense when you talk about institutionalising the financial cultural across all functions, do you split up your brands into different business units within the company or are you talking about actually extending beyond your company to the clients that you service in these seven different countries?

MATTHIEU RIVART: As finance people, you have to meet with your customers because when it comes to trade agreements, it’s so complicated, there are so many implications behind those, where you need an expert in numbers coming with the salespeople. When we talk about back margin, it’s a concept that’s very complicated and which has an impact on your financial performance, which is not easy to understand, because you’ve got kind of a disconnection from a time, point of view, between the moment you sell the product and the moment you [unclear] in your [unclear]. So you really need an expert there when it comes to trade agreements.

CIARAN RYAN: We’re joined on the line by Nicolaas van Wyk, who is the CEO of the South African Institute of Business Accountants. Nicolaas, are you on the line?

NICOLAAS VAN WYK: Hello Ciaran, I am on the line.

CIARAN RYAN: Good to have you on, we’re talking to Matthieu Rivart, he has just raised a couple of very interesting points here. I think, first of all, the, the thing that struck me is his academic background. He’s got a master’s degrees in urban planning and civil engineering, as well as executive management. So he actually came to accounting from a completely different route. That’s the one thing which I think is quite interesting, I’d like to get your comment on that, first of all.

NICOLAAS VAN WYK: I’m happy that we can finally talk with Matthieu and his insight is so refreshing. There was this statistic recently that I saw in two different sources, they say that nine out of ten CFOs in Europe do not have an accounting qualification. We have seen a similar thing happen in the US. There was an article in The Wallstreet Journal saying that the percentages of CPAs being CFOs is diminishing, and in our world that’s the CA. So that’s only nowadays about 36% in the US of all CFOs. We saw this development a few years ago and started to think as a professional body how best we can respond to the new trend from employers to move away from a typical accounting qualification background, to more engineering or MBA type candidates. For that then we developed our own designation, CFO (SA), and we registered that with SAQA. Since then, we have met so many people like Matthieu and providing such deep business insights, as you’ve just explained, how he’s a business partner with the other business units, how he assists them in understanding the business better. That is so far away from what we have recently seen in South Africa with all these financial collapses and fraud and, in our view, that’s because accountants, if they become CFOs, tend to be technical accountants, so there’s a lot of focus on IFRS and that type of knowledge when, in fact, you need to drive business. Despite lockdown or Covid, you have to focus on your revenue, your pricing, your cost of sales and your product mix. That requires a unique set of skills, so I am so happy to talk to Matthieu about that.

‘In Africa, you really need to have this agility and think outside the box.’

CIARAN RYAN: Matthieu, maybe you can just respond to that. First of all, the comment about the non-traditional route to accounting that you took, I know you did address that, but a question I want to add on top of that is are there gaps in the traditional accounting curriculum that you feel you can only satisfy or fill by pursuing more general academic studies as you have done? So you’ve got a very broad academic background from a non-accounting tradition.

MATTHIEU RIVART: Yes, completely, I was speaking about agility. If I take my own experience because I have been an internal audit manager when I was at L’Oreal. So in my whole career I have worked in 25 countries over the whole continent. I remember at L’Oreal when I was moving from one country to another I was always recognising and seeing the same patterns or the same identity. There was one exception, it was South Africa, and I understood that Africa was completely different from the rest of the world, from the rest of the group because of its environment. I was speaking about uncertainty, volatility, in Africa, you need to show a lot of agility. You can’t come with a framework that you think has worked somewhere else in the world and be very rigid about your framework and apply it in Africa. So in Africa, you really need to have this agility and think outside the box. I think the issue that Nicolaas was mentioning is that when you follow, I would say, a pure accounting academic background, you are forced to think inside the box, which I don’t think is the right way to tackle the business issues in Africa and in South Africa, because as I was saying before, as finance you must really be a business partner, you must help teams in creating value in institutionalising this financial culture. So, yes, I believe that the accounting studies should be strengthened by more general academic studies, but at the end, I really think that what matters is the personality of the finance person. As a personal example, in my career when we wanted to move forward with a significant project to improve the margin, and I used to work in a matrix organisation, where I would report to two different CFOs, and one CFO was asking me, okay, how much margin is the project going to bring, and how much can we reinvest in media to improve our sales. On the other side, we have another CFO who said, wait, we can’t move forward with the project yet, because I don’t know exactly which general accounts we’re going to use during these transactions. So it’s really a matter of mentality, where you want to sit as a finance person. I was saying before, do you want to sit in the foreground or do you want to sit in the background. So I think it’s very important for people who’ve got a pure accounting background to try to open to the business, understand the business and don’t stay, I would say, be blocked by the technical background. It’s very important, of course, to follow all the accounting rules, to be 100% compliant with audit requirements, accounting rules, IFRS and so on. But those rules are a guide, a guide and a way to measure the performance but I don’t think that these rules are driving the business decisions. All the decisions must be about creating value in an ethical and sustainable way, and then accounting is coming as a support function to help and monitor that performance.

CIARAN RYAN: All right. Just pick up this point about the fact that you’ve worked in 25 different countries, so that’s a lot of international experience. You’re now in South Africa for, I think about six years, how does South Africa compare to elsewhere in the world in terms of the professionalism in the accounting and business fields?

MATTHIEU RIVART: For me, honestly, I haven’t seen a big difference between South Africa and the different countries. I think there’s a very good academic system in South Africa. The finance population I have been working with have been very professional, very, very good people. So I think in terms of professionalism in South Africa, you can really compare it to the other countries. But, as I was saying, it’s a very different world to work in, it’s very unique, Africa is very unique and needs to have its own solutions. But I’m very confident that with the people we have in Africa and South Africa, we can tackle all the business issues we’re currently having.

CIARAN RYAN: Tell us a bit more about yourself and your background. You’re French, I guess that’s where you were born and grew up but tell us about that and where you went to school and how you ended up here.

MATTHIEU RIVART: So exactly, I’m French, I’m sure you can guess from the French accent. But yes, I was born in France 38 years ago, in the north of France, close to Belgium, and I grew up in a small city and I have always been passionate about culture and books. So I grew up with books, literature, art, culture, history, and I think that’s what really defined, and that’s why I always wanted to discover more and so that’s why I moved to Paris to these business and engineering schools. That’s how then I wanted to embrace an international career. Always wanting to discover more, always be passionate, always be curious, I think that’s what defined me the best.

CIARAN RYAN: So then you worked with KPMG and then L’Oreal, and now with Brands Consumer Group, right?

MATTHIEU RIVART: Yes, indeed.

CIARAN RYAN: Okay, that’s a very neat summary there. So how much of your working career has been spent outside of France?

MATTHIEU RIVART: Most of it actually, I started at KPMG for three years, which was based in France, and then I worked for L’Oreal for ten years. So I started as an internal audit manager. So technically based in Paris, but I was always on the move in different countries. Then I was definitely based in Paris for two years, where I was the finance director for the luxury division for Africa and the Middle East. So there again, it was based in Paris, but it involved a lot of travel to Dubai, Lebanon, South Africa, Morocco, Egypt and so on. Then since 2015, I’ve been based in South Africa. So I would say that yes, out of my 14 years of experience, I spent ten years abroad.

‘The finance role has to move toward sustainable finance.’

CIARAN RYAN: Very good, thanks for that. Would you agree that senior financial executives are required to perform in ways that are not necessarily covered in the traditional… I asked you this question before, but I’m asking this in a slightly different way. As a senior finance executive or CFO, there are some things that you’re only going to learn through experience. You’ve talked about one of your roles being communication, you’ve got to communicate these numbers, you’ve got to tell the story of the numbers. So that involves not just the communication, but it’s team leadership and strategy, and perhaps that’s the most important function of the modern finance executive. Would you agree with that?

MATTHIEU RIVART: Completely, 100%. I’m sure you’ve heard about the concept of a chief value officer and the way that the role of the CFO is moving step by step to this CVO role of chief value officer. The whole idea know for a CFO is to create value for all the shareholders, of course, meaning the investors, but it also means creating value for the employees, creating value for the customers, for the suppliers. In the past we really used to focus on the financial performance, which is how to be profitable, but more and more the CFO or the CVO is actually to [unclear] the non-financial performance, which is how to be sustainable. So you see with the world being more and more complex, I would say we realise that profitability is only one way and one KPI in how to measure the sustainability of your company, because you can make as much profit as you want, but what if all your talents are leaving? It’s not because we make a profit that in ten years we’ll still be there. Your company is not sustainable. So I think finance population, the finance role has to move toward sustainable finance, which is more and more about management and leadership. We can see today in our daily role a big transformation of the finance role, with technology and data. Where before the role of the CFO was, I would say, 100% technical, very focused on accounting. But today with technology, accounting is taking less and less time, and the value of the CFO and the finance population is more about the analytics, what input you can bring to the, to the other teams. And yes, you were saying, 10% of the CFOs in Europe don’t have an accounting background, and half of them actually don’t even have a financial background. I think this is what it is showing is that we’ve got a massive disruptive and very key change today in the function of finance, moving from a pure technical into a more value creation role.

CIARAN RYAN: Interesting. Nicolaas, why don’t you just jump in there, I’d like you to pick up on this point about the CVO, the chief value officer that Matthieu has just been talking about. This is something new and the fact that the technical skills are really being taken care of by computers these days, so what is the CFO or the CVO doing. He’s got to bring some deeper level value to the organisation. Can you just jump in there?

NICOLAAS VAN WYK: Yes, when we registered our designation, we had to do some research, and what Matthieu is now talking about also came out in many research papers, this new move for the new role of the CFO. He described it perfectly, I really can’t add anything, I think Matthieu is the consummate CFO (SA), he’s the ideal candidate and why we started the designation. As we discussed, there are economic implications if you get the role of the CFO wrong, they can’t just be a technical person. So he mentioned personality and he mentioned agility, he mentioned a deep understanding of finance. But what I love is that he said how well read he is, even from a young age he said he’s been exposed to different cultures and to books, and that has always been an interest to him. That is what we find is missing in how we approach the world these days, there’s very little attention on humanities, how the world actually works and how people think, and then we just train people on accounting, without any context. I think what Matthieu is now saying is that there’s context within that function. So our designation is built on four pillars, the steward and the operator role, which is more the back office role, but then there’s this catalyst and strategist role, and with those four pillars, which has been adopted and discussed by all of the big four firms and many universities overseas, we’re setting up a new executive education programme for CFOs because we really think that’s what South Africa needs. We think it’s a scarce skill and there should be a study route towards this designation. What Africa needs to get out of our economic issues is CFOs like Matthieu because they are the ones who want to pull the companies through, and all our economies depend on people like him.

‘You must stay creative, be a business partner and embrace change.’

CIARAN RYAN: Matthieu, so you want to respond to that?

MATTHIEU RIVART: I completely agree and I would say sometimes, because you’re speaking really specifically about the South African market and business environment, and I’m quite surprised when you look at the jobs offered, when you comes to CFO, I would say 95% of the job offers require the candidate to be a CA. But actually, as I was mentioning, I think the role of the CFO is really about leadership and management. I believe that accounting studies are teaching you how to evolve, I would say, in a perfect world, where for each problem, there is a predefined solution. But in the business world of today, especially in Africa, it’s all about managing the risk, uncertainty and volatility. So if I could give advice, I would say the finance population in South Africa, the recruiting environment in South Africa [needs] to learn to evolve. When you’ve been doing some accounting, you’ve learned how to evolve in a very procedural environment. So, as I was saying, when you’re a CFO you have to follow the rules, you have to be 100% compliant, but I think this background of accounting should not shape your personality. You must stay creative, be a business partner and embrace change. I was talking about thinking out of the box, and this is where I think the South African market must move to, be agile, don’t stay in a very predefined framework. Think out of the box, try new things, especially if they have worked somewhere else. But don’t be too rigid, you can’t be too rigid in Africa if you want to succeed.

CIARAN RYAN: Totally agree. What a fascinating discussion. I’ve got a couple of quick questions for you now as we wrap this up. What do you do in your downtime? How do you relax? You’ve mentioned that you had this fascination with reading and arts and culture, but what else do you do?

MATTHIEU RIVART: I do a lot of photography, a lot of I would say quite ethnic or cultural photography. So I spend my free time traveling around the world in very remote places to capture the beauty of diversity in human culture. So that’s why I love Africa so much and that’s why I love Asia as well, so much. So yes, I would go and spend weeks with…we call them tribes or traditional cultures, trying to understand how they live and capturing their beauty. So, yeah, it takes a lot of my free time. I’ve had the opportunity to be published by National Geographic. So sometimes it sounds a bit weird that you’ve got someone who is a CFO, who is supposed to be very strict or very rigid, very scientific mind, but at the same time, has a lot of creativity. I think both combine very well when it comes to my daily life at work.

CIARAN RYAN: It’s astonishing. You’ve been published in National Geographic. When was that and what photographs were published?

MATTHIEU RIVART: It happened a few times actually, but the first time it happened was in 2015, if I remember correctly, just when I had arrived in South Africa. It was a portrait of an Indian woman who I photographed in Jodhpur. It was a great achievement. When I have time, I try to organise some photo exhibitions, but it’s been quiet lately with Covid. So I hope I can have the opportunity to share the beauty of human diversity soon with the public.

CIARAN RYAN: Do you publish any of your photography online?

MATTHIEU RIVART: Yes, I’ve got my own website www.matthieurivart.com

CIARAN RYAN: That’s fascinating. Are there any books that you would recommend?

MATTHIEU RIVART: Yes, I guess we could speak for an hour about books, but I could recommend two books. One really changed my life, it’s a book about philosophy, so it’s not easy reading, but if you want to make the effort, I think it’s really worth it. It’s called Being and Nothingness by Jean-Paul Sartre, who is a French philosopher, and it’s all about freedom, awareness and consciousness. I think that once you’ve read the book, you understand that everywhere you look, you will find situations imbued with meanings, which bear the stamp of existence. So it’s very deep, but it completely changed the way I look at the world today, since I read that book. Otherwise for something a bit lighter, a novel that I would recommend is The Temple of the Golden Pavilion by Yukio Mishima, who was a Japanese writer. It’s about a temple in Kyoto, so it’s based on a true story, it’s a story about a monk who was getting completely obsessed by beauty, by the beauty of this temple, where he is working, to the point where he’s not enjoying life anymore, because anything he does or anything he sees, cannot come to the level of the beauty of this temple. So the whole book is about his mind being tortured, how to live with being pressured by so much beauty around him. So you wonder how he’s going to cope with the situation, and he actually comes to a disastrous decision, which is to destroy and burn the temple. So it’s really a deep book about beauty, about aesthetics and about absolute.

CIARAN RYAN: Very deep, very deep but I’m sure that’s part of the making of every being, it’s part of thinking outside the box and developing tastes in very, very different and diverse areas.

MATTHIEU RIVART: Exactly and if it will help you, if you are passionate about art, about history, there are things that you can always use in your working environment. If you want to succeed, you have to be curious, you have to have the will to improve every day, to discover new things, to question yourself. I think you can only do that through general knowledge and having an open mind.

CIARAN RYAN: Great, okay, we are going to end off there. Nicolaas, was there any final comment that you wanted to make?

NICOLAAS VAN WYK: No, just I’m very much amazed about those books that Matthieu referred to because that thinking is exactly why we need to change the accounting profession and the CFO profession. You need to understand beauty, you need to understand the irony in life, and you need to understand how things integrate with each other. Although we are working with figures, that represents reality and how we shaped them can shape reality. So thank you very much for those books, I’m definitely going to get them.

CIARAN RYAN: Yes, me too. I guess Jean-Paul Sartre I think you can probably get that as a free PDF online. Great stuff, Matthieu, thank you so much for your time today and sharing those insights, it’s been really fascinating. Please stay in touch, come back and share with us how the year is going and what new adventures you’ve encountered along the way in terms of your photography and your reading and your extramural pursuits.

MATTHIEU RIVART: Sure, thank you, it was an absolute pleasure to have this conversation and I’m looking forward to give you more insight in the future.

CIARAN RYAN: We certainly look forward to that. Thank you once again, and also thank you Nicolaas van Wyk for joining us today on CFO Talks.

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