Board Director – Novacom
Currently based in Togo, award-winning chartered accountant, Christian Ayiku, will bring many years of diverse financial experience to his new position at Novacom.
CIARAN RYAN: This is CFO talks and what a pleasure it is today to be able to speak to Christian Ayiku, who is the former Chief Financial Officer with Ecobank, based out of Lome in Togo, where he served on the group Exco committee with a key responsibility for strategy. He previously worked in Barclays Africa as vice president for regional finance, corporate and commercial banking, and before that Barclays Bank Ghana as head of strategy, sales performance, and management information. But most recently he joined Novacom in Johannesburg as a board director with responsibility for finance. Now, Novacom is a recently formed telecoms conglomerate, which aims to consolidate the fragmented telco industry, starting in South Africa, but ultimately aims to become one of the top five telco players in Africa with a projected revenue of US$500 million within five years. First of all, Christian, welcome, how are you? You’re talking to us, of course, from Lome in Togo.
CHRISTIAN AYIKU: Yes, I’m very well, thanks for inviting me to this programme. I must say, it’s an honour, especially looking at the collaboration between SAIBA and myself in terms of my network because I believe the best way for improving oneself is giving back to society what has made you. In terms of doing so, the intention is not just to focus on colleagues in Togo but also across the continent. Given the fact that I have networks in over 36 countries in Africa, where I have experience as a result of working in the banking sector, as well as oil and gas. Having said that you could imagine the outcome, if this collaboration had been done ten years ago, issues like people giving petty excuses for their poor stewardship wouldn’t be so. For example, I was reading about a group of senior guys from the ANC joining the Minister of Defence on a SANDF plane to Zimbabwe to talk to ZANU-PF, only to give an excuse that the Minister of Defence was going to Zimbabwe, so they hopped on. Then all of a sudden, they said they were going to pay back for joining the flight. It doesn’t really bode well governance wise, at the end of the day as human beings, we need to understand that it’s more about stewardship and where stewardship is enhanced, the world is made a better place, and costs of living suddenly becomes within the reach of everyone. Look at the Covid-19 tender issues, where people have tried to rip governments and that sort of thing. It’s not just South Africa, it’s all across the continent. If people are schooled up well in the area of stewardship, things are going to pan out well. I believe that is the missing link in Africa and, hence, people having weak minds. Once you have a weak mind, when you are given a responsibility you will end up literally chopping the money.
CIARAN RYAN: Well, let me just introduce here, Nicolaas van Wyk because Nicolaas is also joining us. Nicolaas is the Chief Executive Officer of the South African Institute of Business Accountants, and he’s also the area president for Africa for IAFEI, that’s the International Association for Financial Executives Institutes. Hi, Nicolaas, how are you?
NICOLAAS VAN WYK: Hi Ciaran and hi Christian and thank you for the invite. Just from that comment that Christian just made, I totally support him and it’s also for that reason that we want to create a network of CFOs in Africa as a bulwark against corruption and the wrong decision making. I think with all these scandals that we see in corruption, and I also see it in Britain and the US lately, they said that of all the Covid money that was dished out in the stimulus packages, about 10% or 15% was stolen, and that’s first world countries But the question is what can we do as CFOs to prevent that from happening. I think the first step would be to organise and become part of a CFO network for Africa. But thank you for being here, I’m looking forward to your interview with Ciaran.
‘All my life I had wanted to be a pilot’
CIARAN RYAN: Christian, if we can just kickoff, people might not know you, you are Ghanaian. I worked in Ghana, we speak the same language, which is Twi. Well, I’m kidding, I speak a little bit of Twi. But tell us a bit about your background and you’ve now joined this organisation called Novacom, I’m very interested to hear about that.
CHRISTIAN AYIKU: So just to zoom into my background, yes, I did most of my education in Ghana, I am a Ghanaian. The interesting bit is that I moved into the world of finance as a result of adversity, and it’s rightly so because all my life I’d wanted to be a pilot. Probably because my father was mostly working outside of Ghana then, and each year the family had the opportunity of flying to visit him. He was working in Nigeria as a mathematics professor. Probably I got attracted by the uniform of the pilots, those were the days of Nigeria Airways. So somewhere somehow after finishing my form five GCE O-level exams I told my old man, who is now late, that I wanted to be a pilot, and the expression on his face was not so encouraging. He asked, why would I want to be an aeroplane driver, whereas I could be an aeroplane manufacturer [laughing]. That really sat in my mind for a very long time. I finished the university programme, I couldn’t cut it for the science programme, so I did business studies. When I came out, I still had that burning passion to change the subjects I had learnt to science, to enable me to enter into a pilot school. Somewhere somehow there was a big wall surrounding me, not allowing me to move into that. I also realised most of my mates from school were all moving forward, some had moved into the military, some had moved to the US to do whatever and I was just left there. It then dawned on me that if I were to just remain as such, I would remain a failure. So in the midst of that confusion, a neighbour of mine, actually I am one year senior to that person in school, introduced me to ACCA, the Association of Chartered Certified Accountants, programme. I then saw that as an opportunity to get out of Ghana and to move to the UK, where the opportunity would then open for me again to enter into pilot school. So I started the ACCA programme by long distance, learning on my own, buying the textbooks and learning on my own, and I was passing at each sitting. Each exam sitting was in six months.
When I got to the final subjects, I said to myself, wow, is this what it’s all about. Just around then I got the opportunity to travel to the UK. I went for a programme at Oxford University, it was a programme for pricing for oil and gas products. Then I had a firsthand view of how some of my old schoolmates were living in the UK, which was literally on the edge of life. I said to myself, no, I think going to the UK to hustle it out to go to a pilot school was not the way out. I went back to Ghana, wrote the final exams and I passed. After a few years I was sent to South Korea for an exchange programme for close to a year. I came back to Ghana and then eventually went to the University of Warwick to do an MBA there.
That was really one of the key turning points in my life, where I saw things differently. Suddenly the obsession with going to pilot school went away. I realised I could do so many things with my life. I came back to Ghana again, this time moving into banking and I started off with Barclay’s Bank, where I was the head of sales performance, management information and strategy for the corporate and commercial banking business, Barclays Bank Ghana. I did that for a while, but I was getting itchy feet and wanted to move on… On the continent because there aren’t enough jobs as and when you want, and flexibility to do the things you want to do, there’s always the backdrop of wanting to move out of the country into the Northern Hemisphere, mostly to the Western world, Canada, the US, Germany, UK. I was thinking of going to Canada but be as it may, as I started entertaining those thoughts, I had an engagement with one of the finance directors at Barclays PLC, and it was more around the treatment of impaired assets, IAS 39I, and my argument to him was to prove why Barclays Ghana as at the time, that was a 2009, was reporting based on Basel I, not Basel II because the central bank was not focusing on Basel II. He enquired about my background and I said to him that I was a Fellow Chartered Accountant, and he was surprised that I was just doing strategy. He said, you have got lots of capabilities, I think your efforts are best spent helping the group, as opposed to sitting in a country. That’s Greg Davis. So he put my name down for me to join the group office in South Africa. By then he was leaving the bank because Absa had then bought into Barclays Africa.
So I joined Barclays Africa and initially started with setting up systems for client level profitability reporting to mirror ledger reporting. This was something I had already pioneered in Ghana. The objective of it was to help the business understand customers much better and also to derive relationship management productivity compared to client level activity. I did this within six to seven months and then handed it over to a team. At the time the numbers were 80% reconcilable to the general ledgers because the difference was mainly because of journals, which were being passed in between. In the UK they had gotten it accurately to 60%. So someone in the UK said, Chris, you are wasting your time trying to get 100%, you’ve materially gotten it right. So then I moved into a project team to work on splitting the retail and business banking business on the African continent separately into corporate banking and retail banking to enable alignment with the Absa business in South Africa, which was already in alignment with the UK. We reviewed and went to the markets in Barclays Africa, that’s on the continent, 12 countries, discovering similar themes running through. It was not an audit, but rather a complete end to end country business review starting with the country MD, all the way down to messengers and the drivers to have a view of what they thought about the bank, and felt the bank could do to turn around itself and to make it significant in its market. For me, that was one of the key highlights of my banking career.
African CFO Award
CIARAN RYAN: So this was at a time when Absa had taken over Barclays, right? You were going and you were doing a 12-country review. So just to jump ahead to Ecobank and how you came there and then Novacom.
CHRISTIAN AYIKU: So in terms of Ecobank, I had done banking work with Barclays for quite a while, I had also become a permanent resident in South Africa, and had bought property there, and I said, look, it’s now time to look for something interesting. At the time Citibank came up with something, HSBC also came up with something but the Ecobank one was very interesting. It was interesting because it was going to give me the opportunity to participate in group finance Exco, as well as group consumer banking management committee. In terms of structure, from my level, you go to the business or functional executive and from there to the group chief executive, that’s how the levels were. So I said, look, this was more sensible, Ecobank, but then I was a bit concerned about the African culture. Notwithstanding I said to myself, look, it’s more about getting to know the African culture and then using the opportunity to influence the right things from a stewardship perspective and also get the opportunity to learn about digitisation and transformation, which was then taking place in the bank. I stayed with Ecobank for close to 42 months and having done that and in the course of that I met Novacom. I met Novacom sometime last year, we’d been having a chat, it’s been on and off, on and off. Last year it was when I won an Africa CFO Award for financial innovation…
CIARAN RYAN: Oh, wow.
CHRISTIAN AYIKU: Yes, the programme was held in South Africa, specifically at Monte Casino, where I was the chairman of the occasion as well.
CIARAN RYAN: So they came and they poached you at that moment that you won the award and they said, you’ll do, come and join our team.
CHRISTIAN AYIKU: Yes, we’ve been having the discussion since then. It’s been on and off, on and off. Quite apart from that I have been a regular keynote speaker on various platforms in collaboration with central banks across the continent, the South African Reserve Bank, Central Bank of Kenya, Central Bank of Nigeria, Bank of Ghana and that sort of thing.
Collaboration with other partners from the United Arab Emirates and all over, even in South Africa. So, yes, we’ve been having that discussion and then in October 2019 I was invited for an award of a doctorate degree by a British university, Commonwealth University, in finance and banking. Following on from all that and the work I was doing on the continent in terms of what could be done in banking to enhance it to the next level, where value is going towards and all that, Novacom and myself felt that it was more of an appropriate time for me to join them since they were focused more on consolidating the fragmented telco infrastructure business in South Africa, once complete they will be focusing on the rest of Africa continent.
CIARAN RYAN: Just hang on a second there, Christian, the fragmented telco industry, I paused at that when I heard you say that because what do you mean by that, you’ve got the cell companies here, you’ve got MTN, Vodacom and you’ve got Cell C. Where’s the fragmentation, maybe I am missing something?
CHRISTIAN AYIKU: So it was also a surprise to me when I initially read about that when we were doing the engagement, and the onboarding. But then as I got into it, I then had a better view of it. So the telco industry is an entire value chain, this is more around the infrastructure setup, and there are lots of fragmented businesses in the infrastructure aspect of the telco industry. People providing towers, people providing services on a small scale to farms like in the Northern Cape, some up around the Western Cape some around Mpumalanga, fibre and that sort of thing. Guys providing fibre to organisations within the republic and that sort of thing. So it’s more around those areas.
CIARAN RYAN: It’s more the backbone of the telco industry. Let’s get Nicolaas in here. Nicolaas, do you want to jump in here because I think we’d like to just steer the conversation a little bit towards CFOs. You have mentioned that both of you have been in discussion about building a network of CFOs across Africa and, Nicolaas, can you just talk about that for a minute?
A whole new world for the CFO
NICOLAAS VAN WYK: Yes, thank you, Ciaran. So it’s always interesting to listen to experienced CFOs and finance executives like Christian on CFO Talks. It’s so revealing to hear and understand how the role of the CFO has changed. It’s really starting off with a finance qualification is just the basics, and then over many, many years the candidates who we speak to develop a particular set of skills to be able to interpret the financial information for the rest of the executive team. Christian mentioned that he’s worked at the banks in developing systems, how he had to adjust on various cultural matters when working at Ecobank, he achieved these honourary awards, being recognised, so it’s a whole new world for the CFO. So because of that, we started with our partner, IAFEI, a competency framework for CFOs because we realised that the classical qualification of an accountant, where you study, get your three-year training and then you have your professional designation, that doesn’t really mean or provide proof that you are now a qualified and competent CFO. So we developed the CFO and we want to roll it out into Africa, the designation, and to do that we partnered with IAFEI, which is an international body for CFOs, establishing member countries for IAFEI, setting up a network of CFOs, and as Christian has said, we’ll definitely be using his extensive network. It’s just strange to me and a little bit funny how this whole profession has developed but we haven’t really provided a home for them. So that’s what we are trying to achieve now. I just also wanted to have Christian’s view on how we can better network CFOs in Africa.
CIARAN RYAN: Christian, do you want to jump in there and just talk about that. Your experience in Africa is quite fascinating. I think just to that point about the fact that CFOs have a different ethos and a different background and a different expectation. How are we going to challenge that? How are we going to not challenge it, but how are we going to accommodate that?
CHRISTIAN AYIKU: Yes, there’s a need to harmonise or bring together CFOs of today into some kind of formal association. The bulk of the CFOs on the continent are chartered accountants who have basically had accountancy training. I am purely a business-oriented CFO, having spent a bit of time in the business development space and strategy space to really understand the practical aspects of things. Example, having gone to Lusaka, Beira, Kazungula in Zambia, Mozambique, and Botswana to do deals. So what I’d like to say is that most of the CFOs today are technical accountants in the sense that they regurgitate what the IFRS speaks, and that’s it. They are not able to add on that practical flare to businesses in terms of showing where and how to make the money or perhaps even stepping into the role of the business head to run the business comfortably. There are a few organisations that have woken up to this realisation and are currently bringing in people with varied backgrounds, such as engineers, doctors, doctors in terms of medical doctors and that sort of thing to run the CFO agenda aspect of things. The CFO term in itself, chief financial officer, is also evolving to what I call the chief futuristic officer. That was something I did a speaking event on recently. Chief futuristic officer because it needs to align with the changing working environment. For example, Covid has shown that you cannot just have an offshore office where you store all your stuff there because when there’s Covid or the pandemic strikes, even those in the offshore office or the war room are also going to be staying home because they could also become sick. So they start exploring things like the cloud, the ability to access systems, as and when. Even having said that, you’re done then look at how do you reorientate yourself to align with what is happening in terms of the new normal. Then again, from the chief futuristic officer, there are other senior colleagues, for example, Professor Mervyn King, who did some work on this aspect with IFAC (International Federation of Accountants), who has also come up with the chief value officer, which I agree with. Chief value officer because the person running the finance at a top of the pyramid needs to be on top of his game in terms of understanding everything, right from law, HR, operations, finance itself, running the business and so on. I agree with Nicolaas, in terms of the conversation we had initially when we met. The content of the CFO in terms of the tools, the toolkit that the CFO needs to excel has changed. It’s no more what we talk about bean counting, get into the work environment, pick up some experience and then become the CFO.
CIARAN RYAN: Can I just ask Nicolaas to comment on that. Nicolaas, the point that Christian has brought up there is that the role and then maybe even the term needs to be looked at. But talk about the CFO designation because it is really aimed at this multidisciplinary kind of role that the CFO has to play. We talked about law, we’ve talked about human resources and all that kind of thing, and is this where it’s going in the future?
‘A technical person won’t have any defence against unscrupulous businesspeople’
NICOLAAS VAN WYK: Yes, we wanted to plot how CFOs develop over many, many years and then draft that into a practical document that aspiring CFOs can use as a roadmap to say, okay, I’m a qualified accountant at the moment, how do I go from here to get to the top finance position in the company. So we develop these 34 competencies and they talk to all the points Christian has mentioned from operations, strategy, HR, technology and obviously the foundation, finance. Then we show aspiring CFOs the steps they need to take to achieve these, we are busy developing with the University of Stellenbosch an executive development programme to talk to these 34 competencies and deliver competent CFOs. I think that has also largely contributed to the fact that we have technical CFOs who are not business focused CFOs, as Christian mentioned, and this has contributed to many of the financial scandals that we’ve seen of late. A technical person won’t have any defence against unscrupulous businesspeople or strong-arm tactics from government. So you have to have a lot of business acumen in this role. So we welcome this new emphasis on the chief value officer and we believe that is the future of the CFOs. The question then would be how do you provide evidence that you’ve achieved these competencies and that’s how we then developed the CFO designation, CFO (SA), which we have registered with our education department in SA and working with universities to change their academic criteria to better suit this new modern CFO. So we’re very excited about that and hopefully with the support of IAFEI, we’ll be able to get this going internationally, as it provides objective proof that the person is now competent in this new role.
CIARAN RYAN: If I can just ask you both very quickly, because we are running out of time here, but Christian, do you think the academic background, you’re a CA and I think a lot of people who end up in the CFO position, they take that route, is there a different academic emphasis that’s needed? You’ve already spoken about some of these other disciplines that are not really covered. You come with an accounting background, it’s not enough, is it? You need to have other disciplines.
CHRISTIAN AYIKU: Yes, I totally agree with you. So in my varsity days I did a Bachelor of Arts Honours, a combined major in accounting and psychology. I initially started with sociology but then dropped it and then continued and majored in both accounting and psychology. Psychology really helped me because it enabled me to appreciate the human aspect of things and, believe it or not, on this journey you really need to be very heavy on the human aspect of things because people behave in all manner of ways, from trying to get your attention for the wrong reasons and that sort of thing. It’s like having a kid at home who’s having a tantrum and wants attention because of attention deficit, and that’s where all the politics and stuff comes in. It also enables you understand how to influence all the people you are meeting for a greater impact. It also enables you to understand that being a CFO is not a clothing that you wear as being your property but it’s an opportunity to influence people and the environment in the right direction so that there is an outcome. I look at things from the perspective of a system in that whatever we do in life is all about input, process and then there’s an output. Most people tend to be happy when there’s an output but I discovered over the years that you don’t stop at outputs, you need to have a feedback loop back into the process so that as you take the critique into the factory or into yourself as a human being, you are then able to improve and innovate yourself. As you innovate, you end up landing in delivering efficiency and as you deliver efficiency over X period of time, it opens the door to excellence, where you become a market leader.
Just to add to all this, I believe one of the missing aspects as well is for people to be well grounded in the area of values because my last ten working years has been successful as a result of values. My value system is in the mnemonic INSPIRE-S…I standing for intentional, everything I do is intentional. The S stands for service, everything I do is a service to the other person. So if the other person doesn’t see it as a service, I have not delivered. The P stands for partnership, everything you do, you need to partner with people, otherwise you are not going to get end results. If you want to run fast, you run on your own, the chances are that you’ll get into an accident. But if you want to arrive, you move with people. The I stands for integrity, credibility is everything in life, once you lose credibility that’s it. If for any reason you can’t deliver on your promise, get to the other party and let that party understand. The R stands for respect, respect in the sense that, the fact that people are talking nonsense doesn’t mean they are shallow minded, it’s because their worldview is shortened, rather you use the value of partnership to enable them to have a broader worldview. The E stands for excellence, I like to leave things better than I found them. The last S stands stewardship, I like to be responsible in what I do, and this is more around how I go about my life. There’s also the how, the how is more like the channel through which I deliver the values simply called FOCUS, F for first things first, O for other things second, C for cutout unimportant things, U understand what you are doing, and the last S is for stay the focus so far as evidence shows you should stay the focus. So my career has been shaped broadly around the what and then the how.
I believe that’s one of the key ingredients, which needs to be imbibed into the CFO curriculum because even at this level, you speak to some finance directors and CFOs, CEOs, you speak to them and they don’t seem to have a clear clue about what their vision or value system is made up of. It really worries me because if you meet such a person, you tend to wonder how is that person running the organisation. It’s like flying in the air without the avionics.
‘I read more than I watch TV’
CIARAN RYAN: Okay, Christian, we’re going to have to wrap it up there but what a fascinating discussion about the changing role of the CFO. Just as a final question, we ask everybody this, what books would you recommend?
CHRISTIAN AYIKU: I’ve been reading lots of books. I tell people that I read more than I watch TV but most of my stuff is from the internet. There are two books that I would recommend, the one is Fit for Growth: A Guide to Strategic Cost Cutting, Restructuring, and Renewal by Deniz Caglar, John Plansky, and Vinay Couto. That’s what the CFO is going to be faced with most of the time. It really gives you ideas around how to go about cost cutting, restructuring and getting the business back onto growth, providing examples of what has happened in other organisatons. The second one I would want to recommend is Deep Survival by Laurence Gonzales, it talks more about who lives, who dies and why. These are two key books I would recommend for up and coming CFOs, as well as already practicing CFOs and, of course, they should keep reading about entrepreneurial books to make them a bit more flexible in their approach to advising the business for value creation.
CIARAN RYAN: Some good recommendations there, one sounds like it’s quite technical and the other one sounds like it’s probably a little bit more of a lighter read.
CHRISTIAN AYIKU: Yes, the second one is more of a reflection about what you are delivering to society, who you are as a person. There’s a third book about the Roman Empire, how it ruled and how it fell, I would recommend that as well. That gives you ideas around corporate governance.
CIARAN RYAN: You’re not talking about Edward Gibbon’s Decline and Fall of the Roman Empire, is that the one you’re recommending?
CHRISTIAN AYIKU: Yes.
CIARAN RYAN: Okay, well, that’s available free online because it was written I think in the late 1600s. Right. Okay, Christian, lovely to speak to you, let’s leave it at that and when the lockdown lifts and you come to Johannesburg, we’ll treat you to a lunch, how about that?
CHRISTIAN AYIKU: That would be awesome.
CIARAN RYAN: Great. Nicolaas, thank you very much as well for that very stimulating, fascinating discussion about the changing role of the CFO.
NICOLAAS VAN WYK: Thank you very much.
CHRISTIAN AYIKU: Thank you very much.
