With this in mind then, the direction of travel taken by Kher is perhaps not so unexpected after all. Indeed, it is his structured approach to his work, and his desire to learn, that has also seen him undertake a Masters in Finance at the London Business School, and the MCT Advanced Diploma of the Association of Corporate Treasurers that grants him Fellowship of that body.
However, it would be entirely justified to feel that the practice of treasury in financial services differs from that of industry. Kher concurs, noting that the main differentiator for the financial services industry is that it is more regulated that several other industries, resulting in “a greater level of constraints”.
However, he adds, across all businesses and industries, treasurers “must strike the right balance between security of funds, and manage liquidity risk whilst trying to maximise returns made by the business given a set of constraints”. Treasury, it seems, is in a permanent state of being what he refers to neatly as “constrained optimisation”.
With the mindset very much to the fore that challenges are in fact opportunities, Kher brought all his previous experience to bear when he undertook the newly created role of Group Treasurer at LMAX Exchange. The opportunity to scale up a treasury function and pivot it to the next stage at a fast growing fintech company was the kind of offer he could not resist. “What excited me about LMAX Exchange was the opportunity it provided to shape the role and make a mark in a fast-growing, innovative and successful company,” he says. “The high growth level of the business means the rate of change will be immense but I view this as an exciting challenge.”
With the work ongoing, he is currently focusing on automating a number of treasury processes to improve the quality of information, and how that information is communicated to management. This, he believes, will result in better-informed decision making and will also translate to greater visibility of cash and risks in the business, “bolstering our ability to manage the balance sheet”. There is more: “As our Asia Pacific offering continues to expand, we will continue to find new and innovative ways of handling clients’ funds in a frictionless way,” he adds.
It’s always an interesting decision as to why a company decides to hire a new Group Treasurer. Grant Pomeroy, LMAX Exchange’s CFO, says that ultimately it was the rapid growth in the business that led to this position being created.
“We have a growing pool of liquid cash, held in multiple currencies which needed more efficient management,” he explains. “Also, as the business matures and as the economy hopefully recovers from a long period of low interest rates, we will focus more effort on optimising returns from surplus funds.”
Skill, judgement and more
Barely a treasury article or conference presentation these days goes by without alluding in some way to the ‘strategic role of the treasurer’. Kher recognises the increasing level of importance the role has at the higher organisational level, but he is also deeply mindful of the ‘day job’.
Indeed, he notes that the strategic role of treasury in financial services can be particularly challenging due to the larger number of constraints imposed by the sector’s regulators. To this end, he suggests that a strong understanding of markets, economics and politics and how these affect cash, capital, costs and controls, is the key to success at LMAX Exchange, as it allows the company to manage its day-to-day financing and its FX risk, both of which are growing in tandem as the business expands.
It is therefore the role of the treasurer to look at the short- medium- and long-term risks “and come up with solutions on how we can maximise creation of value for the business”. This, for Kher, makes it both a strategic and very much hands-on position.