Canadian Bank Note Company (CBN) has a long and illustrious history – dating back to 1897 – and has printed Canadian banknotes since 1935. It was acquired in the 1970s by the current owner, Doug Arends who, with his brother Ron, successfully transformed it into a diverse operation offering security print, identity, excise and lottery systems and solutions around the world.
Supporting both brothers in this transformation was Ron’s wife Marilou, who joined the company straight from university and worked her way up via the production route – a rarity for women even now in the industry, but virtually unheard of then. Following the death of Ron in 2021, she took on the role of Chief Operating Officer.
Currency News™ sat down with Marilou in one of CBN’s three manufacturing facilities in Ottawa to find out more about the company, its markets, its unique strengths, and how she is managing to continue the legacy of her husband and put culture and people at the heart of everything CBN does.
Q: Can you describe your career with CBN and how you got to where you are now?
A: I’ve been with the organization for 37 years. I joined right out of university and started in sales, then spent several years in finance, before moving into manufacturing as the executive assistant to our VP of Manufacturing at the time. I then moved into manufacturing analysis and from there became the first female Production Manager in the history of the company. In 2008 I was given the Bank of Canada account and became VP of Operations. When we restructured after my husband, Ron, passed, I became CBN’s Chief Operating Officer. And that’s where I am today.
Q: And if you could talk a little now about the history of the company itself?
A: Doug Arends purchased the company in the 1970s. At that time, we were just a small security printing company with a few hundred employees focused on the domestic market, producing stock certificates, travellers’ checks, bonus coupons, gift certificates, – anything that required intaglio. Sheet and web intaglio at the time. We were set up to deliver Commercial Security Printing, and Government Services. We produced passports and banknotes for Canada, sharing the contract for the latter with British American Bank Note up until a few years ago.
Doug was very entrepreneurial, and it was in the 1980s he started to think about systems, and how to integrate systems with products. So that became our strategy. And it clearly was a good one!
The early 1990s were a pivotal moment for us, as we designed and printed the first series of banknotes for the newly independent Ukraine, delivering 2 billion banknotes in less than two years. We were already inching our way into the export market and had supplied Romania and the Caribbean with other products prior to then, but this was our first major international banknote contract.
It was shortly after that that Doug called his brother Ron to come and join him. Ron was running an international company out of the US at the time. Both were engineers, and both had MBAs. Ron had a big personality and had been a football player with the Canadian Football League, whilst Doug was the entrepreneur and visionary. The two came together and they were quite a team. They truly complemented each other.
It was that point in time that we kicked off our multi-product approach, and we set up four business units, which are now seven. Together, Ron and Doug created what you see today, which is essentially a significant international player doing business in over 70 countries with over 2,300 employees worldwide.
Q: Sadly, Ron passed away in late 2021. How are things structured now?
A: Ron was our CEO. He was diagnosed with cancer during COVID, but continued working until shortly before he passed in October 2021. Doug owns the company and is Chairman of the Board, and our CEO is now Craig Bascombe. He was formerly the CFO and President of the Lottery division and had worked very closely with Ron for about 20 years. Gord McKechnie is our Executive President, and I am the Chief Operating Officer.
Aside from that, and most importantly, we’re supported by a very strong new executive team. It’s a very talented group of vice presidents. We are organized by market segments with each segment headed by a Vice President and General Manager, with a dedicated team supporting that segment.
Q: So, what are those segments?
A: In addition to Currency, they are Border Management, which covers passports and associated systems for border management; Civil Identity, including National Registries and Electoral Systems; Excise Control; Driver and Vehicle products and systems including mobile digital credentials; Government Lotteries; and Charitable Gaming.
Q: Given the spread of activities, if you were to name the company today, would it still be called Canadian Bank Note Company?
A: Absolutely. We’re very proud of our heritage.
Q: Can you provide any information on the financial performance of the company, international versus domestic sales and the revenue split between divisions?
A: Not as such, but I can say that we are growing at a very good rate across all our market segments and have a strong order backlog with long term customers and contracts.
In terms of export versus domestic sales, in any given year it can change – from 50:50 to 60:40 or vice versa. 2023, for example, is a very big one domestically for passports, as the new Canadian ePassport was launched earlier this year.
Q: Would you describe yourself as a systems integrator, project manager, manufacturer or all of the above?
A: All the above. The multiple roles are apparent in many of our solutions. We’ll take on everything from building and managing the project to purchasing the infrastructure required, designing and printing the document and developing the system to helping set up the right processes to position the customer for success.
Q: But in banknotes, it’s still about the piece of paper, or polymer. Is there anything that you offer above and beyond designing and printing banknotes?
A: We also offer consulting services, including market information and strategy around security features. Along with design consulting, proofing trials and being a research arm for central banks.
Q: What is your capacity, and your key target markets for banknotes?
A: We have two lines here in Ottawa and our target markets are North and South America, Africa, Asia Pacific.
Q: What do you see as your key assets and strengths in a marketplace dominated by state printers and large commercial printers?
A: There’s no question that we’re smaller, but one asset is our design talent. We have won several awards over the last five years or so in banknotes and polycarbonate secure documents. I’d say that we’ve truly worked on perfecting our approach to bringing design concepts through to central bank issuance in record time, and that’s something that we’re very proud of, along with our ability to turn around small orders in very quick time.
We also work very well within our industry. That’s because we are not a supplier of substrates or features, so we are welcomed and encouraged to test and collaborate with other industry partners. We really value those relationships.
A case in point is the work we did with the Reserve Bank of New Zealand for their new series, during which key leaders of our industry partners came to Ottawa along with our customer. This was one of the first times a new series had been approached in this way. Our common goal was to deliver the best solution. It was a case of wonderful teamwork with an award- winning outcome.
Moreover, as we are independent of substrate or feature production, we can provide central banks with a very neutral view on how they could satisfy their own requirements.
Q: When the current Canadian series was launched in 2011, it represented the first use of polymer in a major economy outside the traditional homeland of Australasia.
Can you comment on that series, and on your relationship with the Bank of Canada.
A: There were so many firsts with that series. We had to work very closely with the suppliers, and that’s where we really honed our approach to ensuring that we could achieve high quality on time, according to the very advanced technical specifications.
Moreover, we have a very strong, trusted, collaborative and transparent relationship with the Bank of Canada. We’ve been printing their banknotes since 1935. And over the years, it’s developed to the point today where it’s a team approach.
Q: In terms of investment, where are your development dollars going at the moment? And how are you investing for a more digital world?
A: In terms of our digital strategy, we have been thinking about systems and products since the 1980s, so digital solutions going hand in hand with printed products has always been there for us. But now it’s very much more apparent in our other markets.
A perfect case in point is the new Canadian ePassport – called the Four Seasons of Canada – which was launched earlier this year. It’s an excellent example of where technology design and innovation intersect, with traditional security printing techniques moving into security features that are working with the systems that we have developed.
The passport is considered to be the most secure in the world. We’ve developed the software systems, including biometrics and support entitlement. We do software support and are working with 30 issuance sites across the country, so it’s a very collaborative approach and a significant modernisation of the existing book.
Another example is our lottery business. Some people think we’re just printing tickets. We’re not. What we are doing is running national lotteries for eight countries and providing technology to two others, developing the platform for these, doing the marketing, and even coming up with the games. It is fully a systems and direct to consumer business and with it, we’re very proud that we help raise $150 million annually for good causes.
Q: You commented earlier that the company is growing. But what about banknotes? Are you prepared for a world without, or with fewer, banknotes?
A: We’re grateful for the fact that we’re diversified. We know we’ll stay strong. And we’ll always be prepared and ready to deliver world class banknotes to any of our customers.
Having said that, we leverage our assets, which enables us to stay current and available to print banknotes. But if we’re not printing banknotes, we’re printing many other beautiful documents with similar equipment.
Q: Turning now to the culture of the company, Canada is in the vanguard of countries in terms of corporate social responsibility and ESG (Environmental, Social and Governance) What is your policy in these areas and how are you going about it.
A: It is such an important topic for us, and I am the executive sponsor of our EDI (Equality, Diversity and Inclusion) program that is driven by a magnificent team. CBN is dedicated to the well-being of our team, so with that we’re committed to listening, learning and evolving our practices to support our employees.
We understand that having engaged employees is not only essential to their individual growth; it’s also fundamental for us to achieving our objectives. So, we need to be ensuring that people feel welcome and heard and safe, even in the remote working environment.
We’ve just launched a project to support the evolution of our culture. We spent a great deal of time, effort and money to reach out and understand and hear where we are compared where we want to be. You’ll see our principles posted prominently throughout the buildings. We take them very seriously, but we felt it was time to do a check-in because we’re growing so rapidly.
In parallel we’ve set up a committee to identify changes and enhancements to address the needs of our people that are coming back to us through the enquiry.
We’re excited about this. It’s not just something on a piece of paper, or about being compliant, but about living and breathing the program and getting the best people into the best roles.
Q: You are one of the very few female leaders in the currency sector, particularly given that you came up through the manufacturing route. What percentage of your workforce are women? And what steps are you taking to encourage them?
A: We don’t just look at the percentage of workers. We look at percentages in different positions because that is key. Of course, it can be a lower number at the top than we’d like, but that’s starting to change. Probably around 16% of leadership roles are now occupied by women. We are actively seeking to diversify the workforce at all levels, but we will not compromise on ensuring that the people in each role have the skills to fulfil their function and the opportunity to grow.
Q: What is your personal view, having started out at a time when female participation in the workforce, particularly at managerial and senior levels, was minimal?
A: I grew up in this industry. I came in at 22 years old and was the first female production manager. I now spend a fair amount of my time coaching and mentoring women in leadership roles throughout the organization, particularly on how to be heard while being ourselves rather than trying to be something other people we think we need to be. Personally, I am very sensitive to the challenges and want to make sure that it’s an easier path for those coming after me.
I think women have so much to offer in this business, but we need to make sure that we remain authentic to ourselves and know that we can do this and still be women.
Q: Still talking about ESG, but now the E part, ie. the environment, what is CBN doing to become a good citizen for the planet?
A: One thing we’re very proud of is that we were the first in the world to introduce PVD coating for intaglio plates, around seven years ago. That allowed us to get away from using hexavalent chrome for chromium plates. That was a big step in the right direction.
Our manufacturing facilities are in dense urban environments that are predominantly residential, so we have worked very hard at reducing our noise footprint and ensuring that our emissions are at the absolute minimum and meet all urban environment standards.
Over the past several years our waste diversion programs have dramatically reduced our shipments to landfill and succeeded in diverting much of our waste to recycling. Our team of environmental scientists led by two driven women is empowered and determined to reduce our environmental impact.
More generally, we are of course ISO certified in terms of the environment, and we work passionately to set new objectives for ourselves, working closely with our customers. It’s front and centre for us and, as we go into 2024, we have some tremendous initiatives underway.
Q: You were by Ron’s side helping him and the team build CBN. How to you plan to continue his legacy?
A: There’s no question that during the last few years of Ron’s life, he was focused on people and culture. Because at the end of the day, you can have machines and you can have code, but there are people behind it. And how do we make sure that we are investing in our people?
We’re investing in our culture to make sure that our people are truly committed and passionate and understand purpose. And that’s a lot of hard work, which comes through leadership. It also comes back to our principles.
Ron was working solidly on management styles and behaviours. Specifically, how do you articulate that? What’s that look like? How do we make sure we’re consistent in terms of our management styles and held accountable for our behaviours?
Ron used to hold a leadership summit every year, and in his last year that he held it, he articulated his learnings and his best practices, which we recorded in a series of videos. They were well received, and we still use them today for new employees, and to remind ourselves what he meant and what he said. I think that’s part of his legacy.
Our future really depends on investing in our culture and in our people. It’s just who we are. We have very low turnover. People stay, they’re committed, they are proud and they’re passionate.
If we can continue to reach in, to instil passion in the hearts and minds of the people here at CBN, we’re going to continue to do great things. It’s an exciting time to be part of CBN!