S2E5: Leadership Lessons For Challenging Times: Fred Trinel, co-CEO, Ecovadis

Note: this transcript is automatically generated and only lightly neatened up. So this should be used  only to get the gist of the conversation and any transcription oddities should be ignored!

Richard Medcalf
Hello, my name is Richard Medcalf, founder of Xquadrant. I coach some of the world's top executives in management, helping them achieve bigger and more meaningful results than ever before. In this season, I'm speaking with C suite leaders from around the globe to find out what the COVID-19 pandemic has taught them, and what wisdom they have to share for other leaders. Welcome to leadership lessons for challenging times. This was an interesting conversation with Fred Trinel of Ecovadis. Ecovadis is a highly successful player in the sustainability space recently raised over $200 million and making great impact in the world. With Fred I really talk about not just the 2020 crisis with COVID but also the three or four different experiences he's had as an entrepreneur from 1997 onwards, and how he's navigated those, what his playbook is, and how you can play offence and defence at the same time, in order to better prepare your company for success and to manage the risks, so enjoy this conversation with Fred Trinel.

Hi, Fred.

Fred Trinel
Hi, Richard, how are you?

Richard Medcalf
I'm good. Thank you. Thanks for coming on the call. Thanks for inviting me. So, before we jump in, why don't we just ask you to give a two minute kind of elevator pitch on you know, who you are, what your background is, and what is Ecovadis for those who don't know.

Fred Trinel
Fred Trinel. So I'm Ecovadis co-founder and co-CEO. Ecovadis is a leading rating agency on corporate social responsibility. So what we do is effectively to rate company performance on environmental, social and business ethics and our main clients are large corporations using our solution for their procurement team to take the right decision and help their suppliers to improve. So that's what we do.

Richard Medcalf
So it's really about providing visibility across the supply chain of environmental impact and corporate social responsibility.

Fred Trinel
Absolutely all of those companies, they have several 10s of thousands of suppliers all over the world. It's extremely hard for them to understand, you know, what is the their exposure in terms of risk, what is the level of performance of each of those companies across the globe. So what we do at Ecovadis is effectively to assess each of them and give a rating so that the procurement team can take the right decision and it's for procurement but we also act in finance world was equity firms that want to understand what is the performance of their portfolio companies. So, it's effectively also helping those companies to improve by feeding them back with some data information benchmark on their own performance so that they can decide on how best to improve.

Richard Medcalf
Perfect, perfect. And yes, I know it's a high, highly successful company, you've just raised huge amounts of money. It's going really well. So thank you for taking time out of that high growth business for this call. And tell me a bit about your background Fred. Like how what was the journey that led you there? And I know, you're talking here about leadership in challenging times. I know you've had other challenging times, you know, before 2020 So tell me a little bit about, you know, your history.

Fred Trinel
So my background is entrepreneurship. Basically Ecovadis is my fifth company. I've only worked for myself. I started my first business 35 years ago in Asia, in Hong Kong. Where I lived for 10 years and my major is technology and finance. So usually when I start a new company, often with a partner business partner, and we need to with Ecovadis it's Francois Thaler who is focusing on the marketing and the sales side and I do the operations. So I do everything related to technology, to finance and in general the production and the operation of the organisation.

Richard Medcalf
Great. And so tell me about some challenges. So let's jump in to this actually, let's start right now. Right now, you know, as we're recording, this was still in lockdown, you know, here in France, with COVID-19. So, how have you had to adapt to that? Have you had you know, or have you had to do in Ecovadis, so you know, what's worked, you know, and perhaps what if you do it again, would there be anything you would do differently?

Fred Trinel
So in Ecovadis in effect, we were we are pretty lucky because the company is quite distributed across the world. I mean, we have like 650 employees spread in 13 offices plus many people are working from home in an area where we don't have an office, and therefore, the organisation was pretty radio gear to be able to work from home, let's say. So on the operational side, we didn't suffer so much in the sense that the transition to work from home went really smoothly. Having said that, there is a number of things that we needed to do or we decided to do in order to make sure that we go through these crises in the best possible manner. As you mentioned earlier, this is not the first one. I mean, I went through the Hong Kong 97 the financial crises, you know, that triggers like massive collapse of the Asian economy, through the 2001 September 11. And so 2008 we just started Ecovadis, we started in 2007. So we were very small at that time. So I think very nimble, we survived this one. And now 2020 so those crises, help you shape you know, your experience, and understand what are the mistakes that we try not to do again in the future. So when you have so many behind you there are quite a few opportunity to make mistakes and we did certainly made mistakes in 2001. Just for the little story we raise fund, in fact, that we received on the bank account on the Friday, September 7 and, and I was flying to New York from London where I was leaving on Monday evening. That was the 10th of September and supposed to land in New York on the 11th at 10am. So that was quite quite a shock of course because the company was at that time we had eight offices, it was a SaaS business, 8 offices across Europe and the monthly burn rate of around 1 million. From the day to the other one day to the other the entire business stop and stop for like 18 months we didn't sign any single contract. And it took us probably, two years to recover and start again the business by that time.

Richard Medcalf
What did what did you do then? What did you do? I mean, that's, that's incredible.

Fred Trinel
That's exactly the point not the right thing. We didn't do the right thing. And let me share with you why we didn't do the right thing. I mean, there is no excuse, but what we learn from this. So when you think about it, there are different types of crises, obviously, pure financial crises, like the one in Asia in 97, and the one 2008. They have direct impact on the economy. And then you have the crisis like 2001. And in fact, this 2020, where it's not really the economy that is, you know, having an issue primary, it's an external factor. It's the September 11th towers I like and then the virus this time. And therefore, it's completely different crises, because when you have an external factor, we thought that that time that the economy was fine, and you will rebound and go back to normal in a couple of months. So what we didn't do, that we should have done was to slow down and to cut costs, or at least stop the bleeding and stop increasing our cost base, which is quite the contrary of what we did at that time. We were pushed actually by external members and investors, for instance, to continue to accelerate. And that's what we did. And I mean, it's our fault we should have slowed down and look at what happened and then be ready for the worst, we didn't. So that's a big learning for me, from the 2001 experience was to say, you have to be extremely proactive, to anticipate and to be ready for the worst until you are sure that the worst will not happen. And with the priority to obviously protect the company, and the employment and the people so so we didn't do it in 2001. And it cost us a lot because what happened is that we needed to raise additional funding in a very bad context, not very good at all for the for the entrepreneurs and for the historical Sheldon, as you can imagine. So we learned the hard way. And this is clearly something that we did very differently in 2020. 2008 Ecovadis was too small so we didn't have to face this kind of challenge. But now with a company of our size it's not a huge company, but still 650 people is significant. We immediately as soon as we identified that there is something extraordinary happening because it's, in fact, it's something extraordinary, you can expect that it's going to have extraordinary impact on your business, and unpredictable,

Richard Medcalf
Right. It's hard to know it's hard to know what's gonna happen, all the effect.

Fred Trinel
But one thing is sure is that I mean, one thing is sure is not sure, but you know that you're going to lose a quarter, you're going to lose a quarter when you have such a dramatic event happening whatever happened in the best case scenario, you're going to delete one quarter, your annual forecast. So already, when you're growing, we're growing like, say 35 to 40% a year, we are investing a lot. We have 200 openings. In February, we had 200 hirings going on, 80 of them already in either probation period, or, or just received an offer and ready to start. So the first action we took was to hiring freeze, I mean, very, in beginning of March, late February, to make sure that we contain the cost until we have more information on how things will go. So that's right. That's the first, that's the first the first step we took.

Richard Medcalf
The first thing was like real kind of like refocusing looking at priority thinking of costs making sure that you know, you're taking a conservative stance I guess.

Fred Trinel
Yes, everything that we could do again to protect the company to we know what's going on to protect the environment over existing employees and therefore also hiring freeze postponing every starter because basically, in this particular crises, we are in lockdown, so we cannot even welcome them in any way, so how to train them. Even if it's feasible. It's much harder. Definitely. So we postponed the new starter and we renew all probation trial period, to now to be ready for the worst in the way. So that's the first thing we need. The second thing we need was to and that's really thanks to the finance team and the CFO in place to increase the granularity of our reporting and the frequency of our reporting but big time, as mean today, we have a daily monitoring of all the operation on the T KPIs that are critical for defining how is our business, health, you know, on and where we are going are reported on a daily basis, are measured on a daily basis.

Richard Medcalf
That reminds me if I can interrupt that reminds me, it's a bit like if you're on I mean, I know you're a keen sailor. And if you're on a boat, and you got a great visibility, you know, you set your course and then you can just keep looking and it's quite easy to see and you've got confidence, but when the visibility closes in, when you've got fog, and whatever, you need to keep looking very often, right? You need to keep adjusting all the time. I guess that's what you're saying. When visibility is low, you need to increase the frequency of, you know, walking around the boat and seeing where you are right.

Fred Trinel
That's true. Even Better analogy, which is the flying, if you are in visual flight rules, you can look the horizon. If you go into the cloud, then you move to look at the instrument, you look at the reporting the data, to take decisions. So it's really, so you need to have the right data in each of the right data. And we are blessed to have an amazing team on the statistical and data analysis and the finance team to be able to produce so. So once you have these, you can have the lagging indicator, but also try to define what will be the leading indicators and how you're going to monitor them to understand how bad things are going or will be going and when will be the rebound so that you can reinvest. So that's the second thing we do so change the reporting frequency and granularity. The third thing we did was to set from the very beginning of the crisis very frequent communication forum with the team with the entire team, all hands I mean every fortnight every two weeks and all hands, with Q&A very transparent we have an organisation where we prone really transparency and so we answer question we try to reassure the staff on the fact that we are in control as much as we can be, but for the internal factors, we are in control of the situation with we we are lucky on the sense that we just raise capital not long ago, so we are pretty safe on the side however, we try to reassure the team, we try to make sure that the team is able to deliver is able to continue to work and if they have any question that we can address them, basically. So that's for the entire team. And we said, bi weekly meeting with the entire Excom to decide on what's the plan. We call it the COVID plan as probably everybody does. But we have a we have set up those meetings and quickly we decided to, to separate the meeting into group when meeting for offensive and when meeting for defensive action plan, because we thought that every time we were mixing both it wasn't that active.

Richard Medcalf
Expand on that because I know we've talked about this in the past, right. So the defensive, obviously, it's all the business continuity measures you taking, and the offensive is okay. How do we come out of this as fast as we can? How do we take advantage of this? You know, where's our needs and our customer base? Yes. How do we serve people more powerfully?

Fred Trinel
So we looked at it on the offensive plan. So how can we turn these crises in to an advantage for Ecovadis? And we look at it for like during the operational lockdown just during I mean how do you stay How do you remain resilient, you know to the crisis and how you get prepared for the rebound. And what will be the new normal so around those sectors, so we try to find idea and also around our main pillars, which are quite standout with the customer, the employees, the shareholder, and then the society, the community, planet and society. That's how we could so for each of those pillars, we try to find idea and in the end collect idea from the team opening, you know, like, idea books, email where anyone can send their recommendation or idea they have on the subject and really empower the team to monitor this plan and to extract content from the organisation and make sure that we use whatever spare time we may gain because of the slowdown in the activity to continue to create value for the organisation. So we did it again, offensive and defensive. In the defensive one, it was organised, organised by business unit, and it's quite, it's quite standard. So that's, that's what we've done.

Richard Medcalf
So, so, that sounds great. But let me just play that back. Right just to summarise, so, you know, you froze costs, where possible, kept costs under control, accelerated the frequency of reporting, you accelerated the frequency of communication, and you actually accelerated the frequency of decision making with your executive team, offensive and defensive action. Pretty nice kind of summary, right? Of how in those when uncertainty comes in, you know, you need to kind of speed up the frequency of things and communicate more than ever. Yes, and if you say plan for the worst, you know, hope for the best plan for the worst. So let me ask how's have these difficult times and you say you've had several of them over the over the years? How have they forced you to grow as a leader? You know, what have you learned through those periods? Or how have you had to grow?

Fred Trinel
Well, I think you probably there is things that you learn, you don't even know that you learn, actually the behaviour that we have today. And it's quite nice to be managing a company with two co workers, your team because you have sometime the Yin and Yang, and my background make me extremely safe. And behave extremely in a safe manner in this context my co founder Pierre-Francois is more alright let's invest to be ready for when we come out of the crisis.

Richard Medcalf
So you're playing defence, you play defence and he's playing offence which brings both sides together which is nice.

Fred Trinel
That makes life much easier it solves your need to make the right direction. So you learn, so this is I mean the way we behave today's I behave today throughout this crisis is the clear result of the trauma of for instance 2001 but what we learned what I learned again, it's it's you need to be ready for the worse you need to anticipate in a proactive manner and in and personally I tell myself I really make sure I mean it's really hard to to turn down hirings, you know or maintain the hiring freeze when you know that people are overloaded sometime very busy, I mean ambitious targets. It's not it's hard. And if you look at it that every case by case, it's hard to take a decision to maintain the strategy that we've defined, which is to preserve to stay on the safe side say far from the road, basically. And I think what I learned is that you need to be firm on that. One thing that that for sure. You don't know especially in a crisis like this one, which is probably a potential Camelback crisis, meaning the main problem is not the economy. But the problem we are facing today may trigger a problem tomorrow. Which is probably what we can, we can think that it might happen this way. We'll tell we'll see in two months or three months time, how it goes. So we have to be extremely safe. So that's something I've learned. The communication, communication. I mean, over communicate. Let's not assume people understand whatever messaging you're pushing for them. That's, that's something that, open communication but to stream to two ways. Having people also asking asking their question. And one more thing I would add. I mean, you need to stay in control of the game is like when you fly or when you sail or when you drive. You need to be in control of the game and in a way what you certainly don't want to demotivate your entire team and to not make sure that they are really, you know, we are really pushing it and what we've been really communicating as a message internally is that I mean, there are external factors that we cannot control. But there are internal factors can certainly control and I and we keep telling the team because I really believe it's true. Is that the way we're going to get out of this situation and these crises, how well are we going to be able to get out, we'll be directly correlated in our ability to create momentum today and to, you know, do whatever needs to be done in order to go the extra mile. So that we can, you know, convince customer retain customer, make sure that the team is still performing and, and the mood, the overall mood and I mean, you know, little bit our company reach out, so the energy that we are able to maintain, it's extraordinary, and I hope, I hope that we're going to be able to get out all together from these crises, meaning we will have to go further than the cost reduction through the hiring freeze that we've designed with deciding but if it has to go this way, will be only once we will do it. Yes, that's another mistake that we made in 2001 is we didn't do one restructuration restructuring. Sorry. We went into something progressive, which is very complicated. Yes.

Richard Medcalf
Yes. So I know that focus on what, you know, what can you control there's a friend of mine called Kent Julian, he know he has a phrase e plus r equals O. Yes, events plus, your response to the events equals the outcome. You know, and so events, we can't control our response to the events we can control and it will create the outcome.

Fred Trinel
Yes. And, and just not less, more or less comment is again, if you imagine that so we have the financial health to be able to absorb part of the cost of this crisis without having to you know, restructure the company and fire people. But we do that on the basis that we trust the team is able to create value. Still. On the time that they don't have, you know, to take to be busy with the client or with support because there is less call or and and this is exactly the case. So it's really a time where we can refocus as well on what we need to strengthen intelligible so that we continue to have a solid foundation.

Richard Medcalf
Yes, lay the foundations. Absolutely. Yes, it's time to double down to get it ready to grow. Yes. There are a couple of quick questions threads before we before we started to be really helpful. I just love those, you know, those five kind of key pillars we discussed and offence and defence. The advantages of having 2 CEOs and the number of great topics we've talked about. Let me just ask you a few kind of personal questions and put you on the spot with rapid fire rapid fire questions. So Do you have a favourite book?

Fred Trinel
Well, I, yes, no, I don't read much. But clearly the user manuals are my favourites. I love user manuals, that complex one, like, operating on boots. Okay, I don't know. But but but on the business book for sure. One thing that one book that I really recommend is the innovators dilemma. I love this book, because it's so incredible to see how we can be blinded by success. And, to take the wrong decision. Sorry, and how do you manage innovation within an organisation? I really recommend this book because it has amazing insights.

Richard Medcalf
No, it's a great book. And it's really about how companies make the right decisions at every stage, but it ends up being the wrong decision, right. It's really great. How about how about your kind of top productivity tip? You know, what do you do to keep yourself productive? Obviously, you've got like you're juggling a lot of things, what's been really helpful for you?

Fred Trinel
Wow. But clearly the routine there is a kind of routine. I try to, I try to block spots. But I mean, it's not breakthrough and not very original, but I really try to block spot in my calendar and condense, meeting, you know, so that it's really high focus. During all those meeting that goes, you know, the whole day, and then have other day where I can think on how to prepare and you know how to prepare this meeting. I learned these from I used to live in the US where I just moved back recently. And, in fact, because the team is spread all over the world, but many people are in Europe. We were extremely busy in the morning. A lot of time in the afternoon because on the west of the US, you go back to days to go to go to Hong Kong or Asia where they are sleeping during the afternoon in New York. So, so that's that's a productivity.

Richard Medcalf
Right here. But back to yes, batching your time, right, bringing things together if it's great as well, I agree. Otherwise, you end up with a Swiss cheese kind of diary where, you know, you've always been just, you know. Who's who's the leader that inspires you?

Fred Trinel
Well, quite a few actually, but of course, the traditional one and I'm totally amazed by Steve Jobs, for sure. Even though yes, it's a it's quite standard. No, that's it. I don't have an edge. I don't have many, actually.

Richard Medcalf
Okay, what about what about a childhood hero, who was a hero for you as a child who inspired you or excited you as a child?

Fred Trinel
I don't even dare to tell you the hero was called Fantomette.

Richard Medcalf
My wife, my wife is a fan. I have to I'm probably throwing her under the bus now.

Fred Trinel
Yes, you know her?

Richard Medcalf
Okay, so anybody who doesn't know who Fantomette is you can go into you know, Google, find out. Do you have a favourite quote or motto?

Fred Trinel
Yes, well, no, the motto is that we is the one we use at Ecovadis. Work smart, have fun and make the difference. And that's, that's what we say. It's a yes, I think really work smart is extremely important. We came from a world where people were working hard. I think we really have to mean we love the shift to be working smart.

Richard Medcalf
Great. Well, hey, that was all I wanted to ask you, Fred. Before we leave, where can people find out more about you or about Ecovadis? Where should they go?

Fred Trinel
Okay about me they're not going to find anything. So I grew up in an environment where VIP stay hidden. But about the company ecovadis.com clearly they find everything online. And yes, we're saving the world. So happy to have more supporter everywhere.

Richard Medcalf
Great. Well, thanks again, Fred. Great for you to join us today and look forward to continuing our conversations.

Fred Trinel
Okay. Thanks, Richard bye.

Richard Medcalf
Bye now, and I hope you enjoyed this conversation. Now, let's turn to you. If you're a top performer, who's already accomplished great things, and yet knows that there's a whole new level of impact and potential open to you. Why don't we get on the phone and strategize on how to get you there. Head over to patreon.com forward slash speak, to find out more. Until next time, be bold and be purposeful.