CFO of the Year: MTN’s problem-solving CFO

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CFO of the Year: MTN’s problem-solving CFOCFO of the Year: MTN’s problem-solving CFO

Two years into his role as MTN CFO, Ralph Mupita received four CFO Awards, including CFO of the Year, for the pivotal part he’s played in turning MTN around. CFO South Africa met with Ralph to learn more about the man behind the strategy and the awards. What emerged was a clear picture that this engineer has turned his mind to solving problems in telecommunications, finance and the African continent. By Georgina Guedes, CFO Magazine.

At the CFO Awards 2019, Sugentharen Perumal, executive: group finance operations at MTN, walked up to the stage to accept an award on behalf of Ralph Mupita, not once, but four times. He was accepting the awards because Ralph, MTN CFO, who was voted CFO of the Year, along with taking home the Strategy Execution, High-Performance Team and Finance Transformation awards, was unable to attend the awards ceremony. This was because he was in Nigeria, listing MTN Nigeria on the local stock exchange. This was a crucial step for the telecommunications giant, and also a significant contributor to the strategy that propelled Ralph to his CFO Awards success.

CFO of the Year: MTN’s problem-solving CFO

The Nigeria listing was the endpoint of a long-term plan to resolve some complex issues in the country. To say that MTN has had a difficult time in Nigeria in recent times is an understatement. Many of the issues were inherited when Ralph and CEO Rob Shuter took the helm two years ago, but it fell to them to resolve these various challenges, including a demand by the Central Bank of Nigeria for $8 billion of dividends to be repatriated to the country, a $2 billion tax demand by the Attorney General, and ensuring that the agreement related to the 2015 SIM registration fine of $1.6 billion is fully implemented. One of the conditions of the SIM registration fine was to list the business in Nigeria, which was achieved by 16 May 2019, the day after the CFO Awards.

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Coming in a very busy and complex week for Ralph, his awards recognition was uplifting news – and he was glad that his team was there. “I am very appreciative of the recognition. For me, it was really about my team. I’ve had a strong team working in the background supporting some of the listing activities. And some of those people were in the room for the awards. I’m glad they were there, even though I couldn’t be.” He added that he felt very humbled considering the “class acts” among the others who were nominated. “It couldn’t have been easy for the judges.” He does confess to a sense of relief that the two processes – the Nigeria listing and the “interesting” but intensive awards interview process – had come to an end.

The engineer in a finance role

 Ralph is an engineer by training. He went to UCT to study after completing schooling in his native Zimbabwe 30 years ago. “I worked on engineering and construction sites all around the Western Cape, then kind of drifted towards doing an MBA. In the middle of those studies, I realised I wanted to move away from engineering, and I ended up in financial services, working at Old Mutual for 17 years – even though I started with a one-year plan – and ultimately serving as the CEO of Old Mutual Emerging Markets.” Then, he received a call from Phuthuma Nhleko, the former CEO and non-executive chairman of MTN Group board. “Halfway through him drinking his tea, me drinking my coffee, he said, ‘How would you like to join MTN?’ Initially, I chuckled. Then I went home and asked my wife, Makole Maponya – who is a CA – what she thought of the proposition. I’d never worked in a CFO role. It took me all of two days to think about it. Having reflected, I felt I could take up the role and be part of a leadership team that would put the business into a stronger position to take advantage of the opportunities that digital and financial inclusion presented in Africa and the Middle East. MTN was looking for a CFO who could go beyond the traditional role of the CFO and add a few more things.”

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Ralph did some further research and was reassured to discover that many global CFOs are not CAs, and that in South Africa, somewhere between 20 and 30 percent of listed companies’ CFOs also do not hold the qualification. “Obviously you need someone who understands numbers. And I see numbers as a language that tell me why things are the way they are. Having trained as an engineer, I am very comfortable with numbers. I believe the most important thing about them is that they have integrity.” While the change from being a CEO to a CFO was an unusual one, Ralph was encouraged when he recalled that one of the people he had looked up to, Tidjane Thiam, CEO of Credit Suisse, was once a CEO before taking on the role of CFO. “It’s unusual, but it happens.” He also points out that while bringing a financial services CEO into a telecommunications company might not seem like the most obvious move, there’s a certain logic to it. “At MTN, we firmly believe that the future of financial services is on the phone, so my appointment isn’t as unusual as it might appear on the face of it.”

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The other experience Ralph had gained in financial services that were now becoming increasingly important was capital allocation and a focus on returns.

A curious mind

Ralph says that his curious mind has served him well as he’s shifted industries twice in his career. “I’ve always had the view that you must be constantly learning and have a mindset that says when you get into new situations, you should immerse yourself and become the situation you are in. I’m blessed that I am always curious and always able to adapt.”

He’s found mentors to support him in his learning and growth journey. “When I moved from engineering to finance, one of my mentors told me that there were five things that I needed to understand the industry and its value chain, and then those things each branch into another five things. It was a useful way to get a real grasp of the sector.”

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He says that always being a bit of an outsider has helped him to ask interesting questions that deliver new insights. “Coming into financial services, the learning curve was pretty steep. There’s always a year to 18 months that’s difficult, and during which time I was learning every day.” He went through the knowledge acquisition process all over again when he joined MTN. “I’m still learning and will continue learning. There’s always that first 18 months of the steep learning curve, but then I get more comfortable and start picking things up almost intuitively rather than learning them.”

The other transition, that of moving from being the CEO to a CFO, also took some adjusting. “The CEO is where the buck stops, but a CFO needs to be an advisor, not only to the CEO but also to the company. It’s a strong advisory role. Also, the CFO is there to provide balance to decisions – to provide strategic thinking and highlight the financial effects of decisions. Or at least that’s how I work with Rob – providing balance, giving a risk-based view, providing clear options and working through the consequences of those options, and testing their soundness based on the data, instinct and history.”

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He adds that he’d been fortunate to work with Rob before when Rob was at Nedbank and Ralph was at Old Mutual, which was helpful in the transition. “I must also commend Rob for helping me on the learning journey because he had also made the transition from financial services to working in telecommunications, working for two years as a CFO at Vodacom, before becoming a regional CEO there.”

He says that he has to credit Phuthuma Nhleko for his support. The opportunity to work with Phuthuma was one of the benefits of joining MTN, as far as Ralph was concerned. Phuthuma, like Tidjane Thiam, has been a role model over the last two decades for Ralph. “He’s another engineer MBA, and engaging with him has helped me to learn a lot about the industry and business more generally. Between Phuthuma and Rob, I’ve learnt a lot.”

MTN culture and values

Aside from the change in industry and role, working in any new organisation comes with a cultural adjustment. “What was very helpful coming into MTN just over two years ago was that the values deep within the company are my own personal values – having a can-do attitude, teamwork is key, believing that everyone deserves the benefits of a modern, connected life, where digital connectivity and financial inclusion is critical. And as I have already mentioned, we’re making a difference in the African continent, which I am passionate about.” His engineering background means that he likes to solve problems. MTN presented him with the opportunity to do just this. “It’s in my DNA, my make-up to solve problems. And the more complex they are, the better. When I came to MTN in 2017, I was very mindful of the challenges the company was going through.

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I was very clear, coming into the situation, that there was a need to make some changes, working with Rob and the broader team, to put the business in a more stable position. It has an industrial strength finance organisation and risk organisation, and I knew I was coming in with those key things.”

He says that when he came into the business, he had a list of three-year goals. The first was building a world-class finance function, and he has been making the necessary changes and will continue to do so. The second priority was capital allocation. “I had the benefit of my financial services experience to see what happens when margins really come under pressure. So we had to reposition the business in a lower margin environment. We had to prioritise putting capital where the returns are going to be. We now have set out a very clear capital allocation process.”

His third priority was to enhance the risk control environment. And the final goal was to build a culture of excellence. “A culture of excellence never gets to its destination. It’s always improving.”

Read the full article here: https://cfo.co.za/magazines

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