Mark Godfrey - CFO Spar Group: `Knowledge is quickly gained but wisdom takes time and experience`

“Personally, I believe that as financial professionals we have the real “story” of the business before us in the numbers.” Says Mark Godfrey, CFO of Spar Group since 2010. He calls himself ‘a classical accountant’ with a genuine interest in numbers, trends and relationships, and to analyze how these tell the story of the business.

He obtained a B.COM CTA from the University of Port Elizabeth, and then served articles with Ernst & Young. After qualifying as a CA(SA) at the end of that period, he was then seconded to the Dept of Finance (SARS) to serve his military service. At the conclusion of that period he was offered a permanent appointment and served a further three years handling tax investigations.

Mark was approached by The Spar Group who were looking for a financial manager for the newly opened distribution centre in Port Elizabeth, and was appointed to the position in early 1996. He spent 8 and ½ years with that division. It was mid-2004 when he accepted a transfer to the North Rand distribution centre situated in Midrand - the second biggest distribution centre within the Spar Southern African operation - as Financial Director. "The position was extremely satisfying - not only from a personal growth perspective - but also due to the foreign operations handled from there," recalls Mark. "It was also an operation that enjoyed very satisfying growth - to the extent that by the end of 2009, it was the largest operation within the Group".

In mid-2010 Mark was appointed Group Financial Director to succeed Rodney Coe who retired at the end of that financial year. He has held the Group CFO position from October 2010. Spar Group has been listed on JSE since 2004 and currently employs nearly 4000 people. Mark oversees the staff of the financial department, counting approximately 350 people.

1) What do you enjoy most about your job?
I'm a classical accountant - so have a real interest in the numbers, trends, relationships, and trying to understand how these tell the story of the business - and how to improve it. Since my CFO appointment, I have also enjoyed the interaction with the investor community.

2) How do you perceive the role of the CFO has changed in the last five to ten years?
I do not have a point of reference over that period - but my perception is that it has become increasingly more directed towards non-accounting matters such as risk, governance, compliance, and administrative areas.

3) How do you see the role of the CFO evolving in the next say five to ten years?
I suspect that it will continue alone a similar route - but I believe that we will move through this "compliance" stage into a more predictive, future-focused role - in which more emphasis will be placed on business sustainability aspects.

4) Would you say that accurate forecasting and budgeting is still feasible for a financial department in today's tumultuous financial markets? How do you deal with the volatility?
Yes, I do - but I believe that far more emphasis needs to be placed on the underlying assumptions that underpin budgets and these need to be flexible enough to change as circumstances change. This places far greater demands on financial reporting systems. Less time needs to be spent on the arithmetical budgeting exercise and more on the scenario agility of the outcomes.

5) What do you see as the greatest challenge for South African companies in the global economic situation and for your industry in particular?
We are still relatively sheltered from the global economy - but that is changing rapidly and in certain sectors quicker than others. One common thread in most sectors appears to be that of price competiveness and business is realising that input costs - especially labour - are a challenge. The volatility of our currency plays a further role in the development of our import/export attractiveness.

Our industry - FMCG wholesaling/retailing is faced with increasing competitive challenges as rival local retails increase the marketing fight to capture bigger shares of consumer spend - with the challenge of the international entrants potentially changing the game as we know it.

6) Which skill do you think a finance professional should master to be most successful in his work?
Personally, I believe that as financial professionals we have the real "story" of the business before us in the numbers - and as is often stated, knowledge is power. It is necessary to take the time to learn and understand the business through these numbers and to develop any appreciation for the financial relationships and trends that exist in the business - while at the same time using every opportunity to engage with colleagues and other members of the team to develop, test and refine your understanding of the business, its challenges and achievements. As you develop this expertise it is imperative that you actively - and vocally -contribute to team discussions - and as your do so, your credibility and value will grow. It is obviously important that you remain actively involved in these teams.

One of the real challenges facing business today is the rapidly changing environment - and what worked today, may well be redundant tomorrow. As such, and in line with comments earlier about the financial professional's ability to see relationships changing and trends developing, they are often the early warning that business is changing. Secondly, I also believe it to be within our role to be constantly challenging operations - usually from a cost/efficiency perspective, but also from the point of business decision making and with a view to long term sustainability.

7) Which achievement or project in your business career are you most proud of?
To me, that was being appointed as group CFO of Spar Group. Whilst Rodney Coe's retirement was speculated on, there was no definite time known. Similarly, as the most senior divisional finance professional, I definitely had aspirations for the position - but was well aware that it would not necessarily be restricted to internal candidates only, and no succession discussions had taken place. So it was a humbling surprise when I was offered the position as I was only too aware of the potential applicants.

The first 1,25 years have been extremely challenging from an adjustment perspective as it required a mindset change from operational to corporate (whilst still retaining an operational appreciation). It has been extremely interesting to be exposed to the boardroom discussions and to bring a newcomer's perspective to those meetings. But, one area that I have found very rewarding is the shareholder/investor community engagements and discussions - I find these very often challenging, but stimulating - yet at the same time extremely satisfying to share the company's story.

I have always driven myself to be the best I can be - so before I wish for anything more, my immediate focus is on becoming expert at what I currently have and the position I fill.

8) What three things must you do every single day to feel fulfilled in your work?

  1. Stay in touch with the divisions so I know what is happening in the business,
  2. Influence a business decision
  3. Make a positive contribution to the growth of the shareholder value

9) Who is your role model in life and why?
I have never identified a single individual as people all have inherent faults and failings, so I have rather tried to take the best characteristics and practices from a vast spectrum of people that crossed my path (either personally, or in readings)

10) What vital piece of advice would you give young ambitious finance professionals?
Build your career on a solid foundation - knowledge is quickly gained but wisdom in business takes time and experience.

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