Unlike some spirits, cognac needs to be drunk slowly to appreciate the taste. “You don’t taste cognac in the moment that you first drink it. It is when the liquid passes down your throat and into your stomach that you taste it. It takes time,” Roman Lo CPA, Chief Financial Officer, Greater China Region, at Rémy Cointreau, says.
He likens working for Rémy Cointreau to drinking a good cognac. “It is a great company and has close to 300 years of history but you don’t feel the company culture when you first join it, it takes time before you feel the difference,” he says.
Rémy Cointreau is a family-owned French group that traces its origins back to 1724. It is one of the top cognac producers in the world and is home to brands such as Rémy Martin, Cointreau, The Botanist gin and St-Rémy brandy.
Lo explains that the barriers to entry to be a cognac producer are high, as it takes three to four years from the time grapes are harvested for them to mature in wooden barrels, while for the most prestigious brands of cognac, some ingredients are 100 years old. All the grapes used to produce cognac must be grown in the “fine champagne” or southwest region of France. “The production is limited, and it takes a long time, so it is difficult for a new company to enter the industry because no-one will put money into a company that won’t make any return for the first three to four years,” he says.
Lo says working for Rémy Cointreau, which has a prominent place in the spirits industry, is fascinating and has given him the opportunity to meet many interesting people within the sector, as well as the chance to try the group’s exclusive LOUIS XIII cognac, something only a small number of people in the world have the opportunity to experience. “The taste is really excellent and if I did not work for the company, I do not think I would have been able to try it,” he says.
Good with numbers
Lo describes his work as CFO as ensuring the financial integrity of Rémy Cointreau’s operations in Greater China, which is made up of Mainland China, Hong Kong, Taiwan and Macau. “Financial integrity includes both financial and operational controls for various aspects of the business, such as credit controls, advertising and promotion investment, people investment and cash flow,” he explains.
Lo is also involved in strategic discussions on both financial and non-financial matters. “People often seek my advice on whether certain operations or ideas make sense because I’m good with numbers, and from numbers, I’m good at logical thinking.”
The third part of his role involves participating in negotiations between Rémy Cointreau and its wholesalers in Greater China.
Lo has held the post for four years, and during this time he has helped the management team to become more data-driven, basing their decisions on facts rather than instincts. “I support the team by preparing scenarios and analyses and helping them understand the logic behind the assumptions of those scenarios,” he says. “My colleagues may have a lot of ideas, but they are not always able to put them into a logical sequence to present to our counterparts at the company’s headquarters or our trade partners. I support them with data to help them build up their argument.”
Lo adds that he is also able to help the management team focus on the big picture, rather than getting too caught up on small issues.
As Chief Financial Officer, Greater China Region, of Rémy Cointreau, Roman Lo CPA is in charge of ensuring the financial integrity of the company’s operations in Greater China, which is made up of Mainland China, Hong Kong, Taiwan and Macau.
“Sometimes things that you cannot predict just pop up. The challenge is to make a decision in a very short period of time. I’m often forced to make a decision in a few hours without being able to get all the information I need.”
Preparing for the unexpected
Lo says the most challenging aspect of his role is trying to foresee what will happen in the weeks ahead, and handling unexpected things when they arise. “Sometimes things that you cannot predict just pop up. The challenge is to make a decision in a very short period of time. I’m often forced to make a decision in a few hours without being able to get all the information I need, or I have too much information and that can distort my focus.”
He adds that while difficulties can happen without any prior notice, challenges one has spent a long time planning for may also not work out as had expected. “For both things, you have to understand why they happened in the way they did,” he says.
It is the challenges that keep the job interesting for Lo, and he likes looking back at what he has learned from them, whether it is a technical aspect of tax law, or something related to customs procedures. “Learn from your mistakes. Investigate them and question the decisions you made so that you know how to handle similar situations in the future,” he says.
New directions
During his four years with Rémy Cointreau, Lo has helped to plan and implement a number of changes at the company, working closely with the head office in Paris to change the sales channels in Greater China and restructure the way the company does business there.
The group has more than 10 brands, but not all of these are sold in China. “We have to select which products we are going to sell. If we have a unique product, we have to work with the headquarters team to develop a strategy for how we are going to introduce it. So if a few wholesalers do not like the idea, we may have to convince them.” He adds that the company sometimes has to let go of wholesalers, but this is not as simple as just dropping them, as they have to be compensated. “These are things we have to balance,” he says.
Lo has also overseen the expansion of Rémy Cointreau’s e-commerce channel in Greater China. He explains that the group started e-commerce in the region in 2015, which only accounted for less than 1 percent of sales at the beginning. It started to expand the channel when he joined in 2017, and it now accounts for a significant percentage of our business.
Lo remembers that it was difficult to decide which products to sell online and which ones to continue to sell through wholesalers. “At the time we started the online business, we didn’t know if we should sell the same products as through our wholesalers or different ones. The customers for e-commerce and the traditional business are different, but we didn’t know this when we started to grow the business. It is this kind of strategy that we had to align.”
He adds that the group now knows that e-commerce customers tend to be younger and prefer smaller bottles. As a result, it has some products that it sells exclusively online, such as its Rémy Martin Club 35cl bottle, which has been very successful. “It has been an interesting experience for the group, and for us in China. If you don’t try new things, you will never know,” he says.
A varied career
Lo studied accounting at the Hong Kong Polytechnic University and says he was attracted to the subject by the good career prospects it offered. He started his career as an auditor at KPMG, where he stayed for three years. He says qualifying as an accountant not only provided him with technical skills but it also taught him about time management, handling pressure and ensuring he produced high quality work. He adds that being a member of the Hong Kong Institute of CPAs made him proud to be an accountant.
After leaving KPMG, he spent just over two years working for a company in Singapore and one in Beijing, before the opportunity came up for him to join beer producer San Miguel Corporation as assistant financial controller in 1997.
He explains that the market in Mainland China was booming at the time, but despite being a well-known brand, it was challenging to gain a foothold in the market. “In China, every province has its own locally produced beer, which the local people are proud of. As a result, it can be difficult to gain market penetration as a foreign brand. I had to learn a lot,” he says.
He left San Miguel to become financial controller at Nokia, before holding positions at BMW Group, International SOS, education group Pearson and Wolters Kluwer, and then joining Rémy Cointreau in 2017.
Lo says the biggest difference between working at KPMG and his experience in the commercial sector is that you have to look at numbers from a different angle. “As an auditor, your concern is whether the numbers give a true view of the company or whether it has made sufficient provisions for accounts receivable,” he says. “When you are in the commercial sector you are more interested in the day-to-day operations of the company. Together with the management team, you are also building something beyond the numbers. That is the interesting part.”
Lo began his career as an auditor at KPMG after graduating from Hong Kong Polytechnic University with a degree in accounting. He then worked in Singapore and has since spent more than 25 years working in Mainland China.
“When you are in the commercial sector you are more interested in the day-to-day operations of the company. Together with the management team, you are also building something beyond the numbers. That is the interesting part.”
The story behind the numbers
Lo advises Institute members who are interested in becoming financial controllers or CFOs to learn to see the story behind the numbers. “Accounting trains you to look at things in a logical way. One number leads to another number and you learn how to draw conclusions from data,” he says. When you become a financial controller or CFO in the commercial field, you have to be able to get more from the numbers and understand the story behind them. It is not just about whether you are meeting the budget or not meeting the budget, you have to be able to identify what has gone right and what has gone wrong.”
He gives the example that if sales has gone up, this could have nothing to do with good salesmen, but rather that better credit terms had been offered during the period.
He adds that CPAs who want to become financial controllers or CFOs must also be prepared to make difficult decisions under time pressure and be able to identify what information is most important. “I have to make difficult decisions, and sometimes I have to select from several options that are all bad.”
Finally, he says they should not be afraid to take on responsibility, and to keep going even if things do not work out as they expected. “If things do not go in the direction you wanted, it does not mean failure, it just prepares you for another task. Things happen. Learn from them and move on.”
Unwinding with family… and a drink
When he is not working, Lo likes to spend time with his wife and two sons, who are 17 and 25. “I try to have at least an hour every day to talk to my family. We are all busy but it is not just about how many hours you spend together, but having an hour to talk and to really communicate – that is important. That is how I strike a work-life balance.”
He also enjoys photography and taking road trips with his family. He explains that when they travel around Mainland China, they often intentionally do not take a flight, but opt to drive instead, even if it involves driving more than 1,000 kilometres to reach the destination.
Lo, unsurprisingly, also likes to unwind with a drink. His favourite is a gin and tonic, with cognac coming in second place. “We have a gin called The Botanist. It is extremely good,” he says.
Rémy Cointreau is a family-owned French group that traces its origins back to 1724. It is one of only three large cognac producers in the world and is home to brands such as Rémy Martin, Cointreau, The Botanist gin and St-Rémy brandy.
