Royal Smit & Zoon is a family-owned company that is a world leader in sustainable chemicals for leather production. Through three main brands, Smit, Codyeco and Nera, the company offers products and solutions for tanning, post-tanning and finishing processes.
1. Can you tell us more about your current strategy and the challenges in your role
Royal Smit & Zoon is a family business and has existed for more than 200 years. The family business has gone through several transformations over these past two centuries. The current global economic situation, along with the impact of COVID-19 and the sustainability transition, are creating challenges.
Our operations first started with selling salted cod, followed by trading in cod liver oil and later fish oil. It turned out that fish oil is an important raw material for the production of leather chemicals, and this business has become of great importance to our company over the past 50-60 years.
Our strategy focuses on the global market, considering that the leather market in the Netherlands is still limited. We face different markets, with some primarily focused on quality (especially in Italy) and others more on cost (Asia). To adapt to these different markets, we offer different product qualities and solutions. Over the past five years, we have increasingly focused on sustainability and promoting sustainable products throughout the leather industry value chain. We want to be a catalyst and an inspiration to transform the leather industry into a more sustainable industry.
We find that the industry is not yet ready for this change everywhere in the world. While we in Western Europe want to be at the forefront of sustainability, in other parts of the world the attitude is often: if it costs more money and laws/regulations do not enforce it, I am not yet willing to pay more for more sustainable products. It is similar with organic food. If you are not motivated to eat organic, why choose more expensive food?
Fortunately, we see that the transformation is improving in all parts of the world. However, a major challenge for our company is the increasing regulatory pressure in the industry regarding 'undesirable raw materials'. However, we also see this as an opportunity to make a difference by removing undesirable raw materials from our products earlier than necessary to gain a competitive advantage.
Our focus is also on accurately analysing different product groups and production phases. For example, for tanneries, the lowest price is very important, while big brands focus more on appearance and quality, and are therefore willing to pay a different price.
Another key challenge for our company is to make costs more flexible. This means exploring whether we can further automate processes and outsource tasks that are not part of our core business, and so on. As a family business, we still do almost everything ourselves, but in the future we will have to seriously consider other options.
2. Does the implementation of the ESG guidelines contribute to Royal Smit & Zoon's transformation into a sustainable industry and its reporting?
Absolutely! Royal Smit & Zoon has been paying attention to ESG for quite some time and for several years has employed an ESG director who focuses specifically on this topic. This person represents us in various bodies and tries to help the industry on its way to becoming more sustainable, while we also keep ourselves well informed about what is going on, what is going to be banned, and where we can sponsor. I think the implementation of the ESG guidelines certainly helps in these efforts, as it is now no longer optional, and we all need to be aware of our footprint and how to improve it throughout the chain. Of course, implementing the ESG guidelines is a huge challenge for everyone because all the information has to be collected and harmonised.
3. Royal Smit & Zoon has been around for 200 years. Is long-term vision important?
Definitely. Adhering to a long-term vision is of great importance to Royal Smit & Zoon. Our main value is to ensure that this company is passed on in a good state to the next generation. Marc Smit is already the seventh generation to run the company. Our goal is to not only pass the company on to the next generation, but also to improve it. Right now, sustainability is one of the biggest challenges for us. We are not aiming to become bigger as an organisation for the next generation, but rather to become better. That way, we lay a solid foundation for the future.
4. Why did you choose to work at Royal Smit & Zoon?
I had known the company for many years as I was the external auditor there for a long time. When I joined Royal Smit & Zoon, there was a challenging agenda including the integration of Codyeco, a major acquisition of a new business unit in Santa Croce sull'Arno, Italy – right in the middle of the leather area and close to all the major fashion houses. This brought us an expansion of our product portfolio in the high-end fashion industry. There was a need for someone who could support the family in finance, tax, IT and HR – which I now have responsibility for with my teams. It was an important step for the company, which had previously been mainly managed from the Netherlands.
Moreover, Royal Smit & Zoon had just bought a patent that showed promise in the field of developing a sustainable tanning agent. This boosted us tremendously and has since grown to become our innovative arm and startup called Nera. These aspects, combined with the strong focus on sustainability within the company, made it a great challenge for me. In addition, what a unique opportunity for me to join a fantastic family business.
5. Are there any lessons you learned during your time at KPMG that still influence the way you work and lead your team today?
I learned a lot at KPMG that still affects the way I work and lead my team today. As a young professional, I experienced huge development at KPMG, both professionally and as a person. The trainings on soft skills were very useful, with an emphasis on approaching things from your feelings and letting them weigh up. It is not just about the facts, but also about really looking and listening to what is going on around you and naming it. Showing empathy and feeling and seeing what is going on with people is SO important. By doing that, you start conversations about issues that might not otherwise have come up. Merely looking at the facts and checking them is not enough. If you don't talk to the person about why he or she is in a certain position and what concerns him or her, you will never get to the heart of the story
At KPMG, a lot of attention was paid to developing yourself as a person, especially in the transition from manager to partner. There were intensive training sessions with psychologists and role plays. These training sessions went deeper and deeper into who you are, what you can do and especially what you cannot do. When you learn to understand yourself and others better, you carry that with you for the rest of your life.
6. Do you have any tips for former and current colleagues at KPMG?
I value accountants who not only have business knowledge, but also have an eye for others, and are able to have a good conversation about complex issues and grey areas. Authenticity is also important here. It is essential to focus not only on the factual side of the balance sheet, but also on soft skills and the human aspect. So, my tip for KPMG colleagues and alumni is to always aim for a holistic approach and pay attention to both the hard facts and soft skills.
An example of something I found great at KPMG was the 'blitzing' – visiting clients without an agenda and without an appointment. This was great fun. An accountant who came by without an appointment and where it was not just about the figures, but also the personal contact with genuine attention to the relationship. Being more than just an accountant, but also a good listener with a critical eye. This kind of action really contributed to my development as a broad interlocutor.
Another tip I would like to give is to mingle at lunch with colleagues from departments other than just the finance department. You will then hear so much more about what is going on, what people are working on, and so on. That is really valuable.
Dennis Maas lives with his wife and three children, including twins, in Amsterdam. He started his career at KPMG in 1996 and became a partner there in 2010. In 2015, he moved to Deloitte, where he worked for almost three years. In 2018, he moved to Royal Smit & Zoon, where he started as an advisor to the Board of Management and where he was appointed CFO and member of the Board of Management in 2019.