Geerte Hesen (Ferrovial): 'Stable frameworks are crucial'

On the walls of the Dutch headquarters are photos of Ferrovial's major construction projects, such as airports and smart highways, a system of managed lanes using a fluctuating toll system developed as a solution for improving traffic on congested urban routes. Plan, design, execution, financing, energy supply, security, maintenance - everything is done under the Ferrovial umbrella. 'In many cases we even provide roadside assistance similar to the Dutch ANWB,' says Geerte Hesen. 'To show that we are more than just a construction company. People often think of Ferrovial as a kind of Spanish BAM patrol vessel. That is partly true. It is just that we are much bigger. And much broader. We are a global player in infrastructure projects, active through four large, diverse divisions: toll roads, airports, construction, and energy.'
Geerte Hesen has been the chief legal & compliance officer and company secretary of Ferrovial since April 2024. A company—'I will be honest'—that she did not know much about when she was approached when still in her previous position at Lumicks. 'You do some Googling and research,' she admits. She has been in the role for more than six months now, has made a tour of the company's billion-dollar projects and seems to be settling in. 'The ambitions of this company and my personal ambitions are in good alignment.'

Could you relate something about your background, where you are from?
'I was born and raised outside the Netherlands. My father worked as an agricultural engineer in developing countries. I was born in Oman and then lived in Nicaragua and Guatemala, among other places, for several years. Growing up abroad, in countries where life was not always easy, has shaped me as a person. It has taught me to be flexible, for example. It gave me the ability to adapt, make connections, and build relationships in various environments time and time again. Perhaps that is why I see myself as a connector. In any case, it is a fact that an international environment has always attracted me, just like travel. I have always wanted to discover the world. That adventurous spirit is in my DNA.'

Why are you suited for the legal role? And how do you view this position?
'Even at college I was already unable and unwilling to choose between economics and law. I found both fields interesting. So, I combined them. I still have an economic mindset and a strong interest in business. I would not want to focus purely on the legal aspect. How can we move the business forward within all relevant legal frameworks? That is how I see the legal function.
Recently, someone told me that they consider me an atypical general counsel because of my broad perspective on the business. That surprised me because I truly believe that this is how the role should be performed – with that broad vision, and especially, in the role of enabler. Of course, we must comply with all relevant laws and regulations, but the most enjoyable part of this role is being involved in moving the company forward. That fits within the culture of this company. Ferrovial wants to be a frontrunner, innovator, and leader in everything. That is where the company's ambitions and my personal ambitions align, and why I feel at home.'

Why did Ferrovial choose you?
‘Before I joined the company, I was the general counsel of life sciences scale-up Lumicks. We had big ambitions and, like many scale-ups, dreamed of an eventual IPO. But unfortunately, the market came to a halt, and we had to adjust our growth ambitions and reorganize. A reorganization can be energizing too, but not necessarily the reason I was there for. Then Ferrovial approached me with exciting challenges. They just completed the listing in the Netherlands and wanted to pursue a US listing. That seemed interesting to me. What also attracted me was the international scope of the company and its breadth, which offered many different perspectives. It was also a great opportunity for me to be more broadly involved in strategic matters from within the legal role.’

And then suddenly you were part of a large Spanish multinational. How has the experience been up to now?
'I felt at home here from day one. The roots of this company are in Spain, but Ferrovial has been active worldwide for a long time. The company is very internationally oriented. For example, English is the working language. I have not felt excluded for a moment. Of course, there are differences in corporate culture. The Dutch corporate culture is flatter and more direct, the Spanish culture somewhat more hierarchical. But I have not encountered anything insurmountable. There is a unique culture within this company, with high standards of integrity, loads of commitment, and plenty of ambition. When a decision is made, the entire company unites in support.
I find it a fun company, and a special one. What appeals to me is that we work with a long-term perspective. It is always about the long term. The contract for the 407ETR— Toronto's ring road—spans a period of almost one hundred years. In the construction of managed lanes - the state-of-the-art highway network we developed - we conclude contracts that continue for decades. That is unique.’

What did you bring to the company, and what do you still want to bring?
'I think I added something to the international perspective. What I see as one of my most important tasks is to foster connection. Traditionally, the company operated very much from the various divisions. We want to collaborate more and share knowledge. That also falls within the scope of the legal department, especially since laws and regulations are becoming more numerous and complex. I also try to renew the function. Like many companies, we increasingly need to do more with less and need to comply with an increasing number of laws and regulations. So, within the legal function too, we are considering how legal tech and AI can support us. We also want to bring certain knowledge, for which we have been relying on external parties, more in-house.'

Before you joined Ferrovial, there was considerable disgruntlement about the move of the headquarters to the Netherlands. What was your experience with that?
'Ferrovial was listed on the main index of the Spanish stock exchange but wanted to move to the Netherlands because we have here a more international and open market. It was also intended to facilitate an IPO in the US, as this was not possible directly from Spain. The US is an important market for us because several of our largest infrastructure projects are in North America. We aim to expand our investor base with American investors. The Netherlands was a logical springboard to the US market. Of course, it was a sensitive issue in Spain, but the decision formed part of Ferrovial's expansion strategy and vision. We now have a larger international presence. Fortunately, I did not experience the most heated debates. By the time I arrived, all the dust had settled. Ferrovial has now successfully completed the US listing, in addition to the listings in the Netherlands and Spain. The relationships within the company between Spain and the Netherlands are excellent.'

You are also the company's first head of legal in the Netherlands…
'My predecessor was based in Spain. He was general counsel and company secretary. He had been with the company for quite a long time and went into retirement. They then reviewed the position. I got the compliance part added, with the result that it has become a quite substantial role. But that makes it interesting. Our team of more than one hundred lawyers is active worldwide. We have many people with broad experience in construction contracts, project financing, and project management. We have teams at central and divisional levels, as well as teams that are part of investment projects, such as at the 407ETR. It is quite complex. But I like complexity. It should not be too simple.’

What do you find the most important in governance?
‘That we do the right thing. That we ensure we know what is happening and operate in accordance with applicable legal frameworks and governance codes. This company has a high standard in terms of governance and integrity. That makes it satisfying to work here because integrity is also to me a critically important value.'

ESG will also be an important issue for the company, yet I noticed there is no ESG committee. Why is that?
'That was also one of my questions when I joined the company. The reason is that sustainability has been an integral part of the company for a long time. We have, for example, been in the Dow Jones Sustainability Index for more than twenty years. The reason we do not have a separate committee is that Ferrovial sees sustainability as every employee’s responsibility and does not want too many layers. We want to remain agile. The sustainability policy is the responsibility of the entire board. We did not see the direct added value of a separate ESG committee.'

And shareholders are not asking for it either?
'No, I think our shareholders are quite comfortable with how we perform in terms of ESG. We are also ready to comply with European regulations and the CSRD reporting, and we are working hard on CSDDD. As we have been focusing on sustainability for many years, we find it relatively easy to start working on these issues. There is a heated debate in the Netherlands about the sustainability strategy and whether a binding vote on sustainability reporting should be required for large companies. Such an obligation goes too far for me. But at the same time, we submit our climate strategy report, with our plan for reducing our CO2 emissions, to our shareholders. In that, I think we are unique in the Netherlands.'

You are not, then, dealing with activist shareholders?
'Because we have a clear long-term vision, we also have a fairly stable shareholder base. I think investors with a long-term perspective find us attractive because of our clear course. They do not jump in and out. Shareholder activism is something we always keep an eye on, of course, as to adhere to corporate governance principles, we need to be aware of what is happening. But in general, we have a good and healthy dialogue with our major shareholders.'

Is diversity an important topic?
'Yes, it certainly is. We meet the diversity targets set for boards of directors and supervisory boards, and we are on track for those of the management team. We have set ambitious goals at the senior and executive levels. But there is always room for improvement. Because we have a strong focus on engineering, men are unfortunately still somewhat over-represented. But we have clear targets, and the percentages are increasing. Incidentally, it is not only about gender ratios. In this context, the diversity discussion in North America is interesting. There the debate is already one step further. The discussion there is not about women's quotas alone but also about underrepresented gender or underrepresented diversity. That is how we generally look at it.'

What is your leadership style?
'I would call it a connective leadership style. I find it important to connect the different layers and divisions. I think the legal function is a connecting function anyway, as we have exposure to much that is happening in the company, and we are involved in many projects. Another priority is to build a diverse team and bring different perspectives to the table. Furthermore, I love innovation and find it extremely important. How can you truly improve the function? I also find it essential that you, as a lawyer, are a business partner who understands what the business is about. This is also something I want to grow in my position. I also travel considerably, to personally see our projects, to know what we are doing and where the challenges are. Otherwise, in my view, you cannot advise the company at a top level.'

What keeps you up at night?|
‘I do not lose sleep easily. I am an optimist and tend to think that there is always a solution to be found. We are currently working on taking the next step with the listing in the US and to further build the investor base there, and of course we are always looking for new infrastructure projects. This is complex, as we need to be aware of an ever-increasing number of laws and regulations we need to adhere to, especially because we are active in multiple countries and trade blocks. The different standards being imposed are quite a challenge for international companies. Stable and clear legal frameworks and good governance are crucial. We must ensure that an increasingly complex landscape of laws and regulations does not become an obstacle to competitiveness and sustainable growth, and thus to the ability to conduct business, especially on an international scale.'

This interview was published in Management Scope 10 2024.