We recently spoke to Nishan Kodituwakku, Deputy Treasurer at ABC Refinery, about his finance journey in Australia’s gold industry and gold’s value in protecting wealth during times of uncertainty.
What inspired you to join the industry?
I studied accounting and finance at university many years ago (so long ago, that “online” was not even a term). My dream from a young age was to be a commodities trader but such roles were very rare.
After I graduated, I became an accountant and got all my post-grad qualifications, waiting for an opportunity to break into the trading industry. That opportunity came along over 20 years ago when a precious metals refinery was looking for a Trader’s Assistant. It was a very junior role, but no better way to get in the door and learn.
I loved the fact that trading commodities was global with so many variables involved. Trading precious metals was also perfect given the influence Western Australia has as a leading global gold producing State.
Tell us about the Pallion Group?
My first impression was that this organisation is more a family than a group. This term of “family” is often used, but never have I felt it more. And that’s after many years working in government and investment banking.
Pallion, ABC Refinery’s parent company, is involved in so many different aspects of the industry from minting and casting to retail and investment. It is a truly integrated organisation, from mine to market.
Our flat structure also ensures we are perfectly placed to meet changing conditions and seize opportunities. The lack of bureaucracy whilst giving employees the ability to operate autonomously, using their initiative, is a huge advantage and very refreshing.
What does your day-to-day work involve?
Given the diversity of the Pallion family, I am lucky that no one day is ever the same. I could be exposed to any of the different business areas where my input is needed. Pallion have a very collaborative approach with the fundamental aim of looking after our clients and growing the business.
Working as the Deputy Treasurer of ABC Refinery, we refine over 40% of Australasia’s gold and silver. My main aim is to ensure that our clients are looked after and be the one point of contact for whatever they need, 24/7.
With the role comes the responsibility of servicing clients with their post-refining needs, such as pricing. Given how volatile the markets have been, our clients trust us to ensure they receive the best possible price. The price received is one of the most important aspects along with maximising the ounces received from refining (where my colleagues in refining excel), as it is the financial reward for all our clients’ hard work in producing the gold and has a flow-through effect for every mining company.
The other hat I wear is that of a trader. My colleagues and I are constantly watching the markets at all hours and making decisions on buying and selling metal and currency.
I could also be speaking with an array of potential new clients, chatting with our finance team on investment strategies or meeting with marketing on proposed plans. Such interaction is not only essential in a diversified group, but also encouraged.
What drives you in your role?
I am grateful to do something for which I have a true passion among similar, like-minded colleagues and clients. This drives me to always do the best I can.
What has been your biggest learning curve or challenge so far in the industry?
No one day is ever the same and you are always learning. This applies even after 20 years in this industry. The current situation with COVID-19 would be the biggest challenge everyone has faced to date. This applies not only to the gold industry, but globally across all industries.
Aside from protecting everyone’s health and safety, as a refinery with so many clients, we also need to ensure we continue to do our jobs to keep the “wheels in motion”. For example, ABC Refinery has a client whose mine operations in that region contributed to over 50% of jobs in the community, directly and indirectly.
Given the shutdown of airlines, everyone at ABC Refinery worked together in getting their gold shipped to Sydney. This included that country’s army, who provided an escort for a chartered private jet to transport the gold to Sydney. If the client had not received the funds for that gold, it would have had a huge impact on that community.
What gets you excited about gold?
Gold has been used and valued for thousands of years, and to be involved with this precious metal today is both a privilege and challenge.
Gold’s status as a ‘safe haven’ asset has never been more obvious than with the current COVID-19 situation. With all the uncertainty and wealth destruction in many other asset classes, gold has had a stellar performance. If Pallion can play a small part in ensuring those who seek access to this metal are able to do so, that really gives myself and my colleagues much pride.
Our retail and investment arm, ABC Bullion, has seen unprecedented demand for gold in both physical and investment forms. Working together with gold producers, we have ensured there is supply into ABC Refinery to produce these much sought after bars and coins.
Why is gold important right now?
In this current global crisis, it is one of the few commodities that has seen a rally in prices compared to others. Gold’s role in delivering value in this climate to the Australian economy cannot be underestimated, as we are the largest producer after China - employing tens of thousands directly and indirectly while generating billions for our country.
On a personal level, having exposure to gold allows individuals to diversify their portfolio and protect their hard-earned wealth. The term wealth does not apply only to your savings but also, for example, your superannuation. As mentioned before, gold as a safe haven asset has never been more considered than now.
This does not mean that you put all your eggs into the one basket that is gold. However, there is a reason why this metal has stood the test of time. There are no other assets where this applies and there is a reason for that.
What advice would you give to those studying a trading discipline or to someone who wants to join the precious metal industry?
To anyone wanting to do anything in life, I always say do it because you have a true passion for it. When you do, you never “work” a day in your life.
I was lucky to join at the ground level and had some amazing mentors, which continues to this day. I also had and have great colleagues and clients who I learn from every day. It will not always be easy, but to join an industry with such an impact locally and globally is unique and will be well worth it if that is your passion.