Delve into the untapped potential and unique skill sets that internal auditors bring to the table in the seventh episode of Inside the Auditorium with our guest, Ivan Martinez, Chief Audit Executive for the Santander London branch.  

This episode explores: 

• Unlocking hidden potential: Ivan shares his perspective on how individuals transitioning from non-audit backgrounds often perceive internal audit as mere rule enforcers. However, he explains the evolving role of internal audit, transforming from traditional assurance work to becoming strategic advisors and essential business partners. 
• The internal auditor's breadth of perspective: Apart from the CEO, internal auditors possess a holistic understanding of an organisation's structure. The internal auditor’s role positions them as the CEO’s ally in managing a wide scope of risks and issues that otherwise may go unnoticed.  
• Embracing data analytics: Ivan advocates for incorporating more data analytics into Business as Usual (BAU) activities and stresses the importance of automating testing processes, such as reconciliations and independent business analysis, through embedding new tools. 

Tune in to gain valuable insights from Ivan as he challenges the stereotypes of internal audit as a "tick in the box" role and the increasing demand for internal auditors to be integral to decision-making processes. 

Enjoy! 

Note: The views expressed by Ivan are his own and do not necessarily reflect those of his employer. 

Hello, Ivan. Welcome very much to the show. I'm just really curious to understand. You've been working within Audit the whole of your career. And I noticed that you started as a private banker for Santander in the first year. Can you please explain to us what made you decide to get into internal audit?

So first, thank you for having me here and sharing my experience with all of you. So yes, when I finished my university studies and so on, I started in the financial industry, in private banking. To be honest, at that time I was young and...

eager to learn and I thought that internal auditing was going to provide me with a better background and a better overview of the whole industry. Obviously, at that time I didn't know exactly what an internal auditor does and what is this and I was super excited about it.

obviously traveling, knowing a lot of people, and also the dynamics of internal audit about learning in different areas and so on. So I will say the first impulse to move to internal audit was to learn more and having exposure to different areas, not just...

the sales activities and understanding better how a bank and the final industry works at the end.

Okay, because you've obviously, with working with the same bank throughout your career, what would you say then has been, I suppose, what's made you stay working for the same company?

So I had this question a lot of times and I would say that in a leasing in internal audience and you have challenges and you have a progression quite regularly so you are in the wheel of getting promoted, getting new challenges. It's true that in the global companies.

you have the opportunity to travel abroad and knowing more colleagues around the world, meeting new cultures and that is really exciting when you are young and you are really eager to learn and to know more about banking. And on the other side, I found internal audit as a place to be.

basically have a wider view of the organization. It's true that sometimes it looks like it's not super exciting, the internet world, but to be honest, I found it very dynamic because you are jumping from auditing, imagine market risking in Argentina to...

private banking in New York or Portugal. And three months later, just reviewing an event that has happened in the industry and see how this is impacting your company. So I would say this is the main thing. So usually in the organizations that I know, because I've got a lot of colleagues in the industry.

In technology, this is a career very dynamic and very rewarding in terms of progression because it's very structured and it's easy to progress and to get and to move on the next steps. And I think that is very rewarding and very important to continue in the same area.

And with regards to then climate change, ESG, with regards to, I know that when I started recruiting in the industry, travel for internal auditors was sort of around 70, 80 percent. And then sort of since COVID and with the new technologies that are coming out, it's almost as though not many people are traveling as much.

So would you say that this will travel will continue?

I think we'll continue but obviously with different intensity. Obviously for doing our work right we need the continuous relationship and physical relationship I would say having face to face meetings with the people and so on. Obviously the new technologies are helping us a lot in...

contacting people in other geographies instantly. So we've got at the click, we've got someone in our screen, but I would say that there is still an important factor of a human factor of having meetings face to face and resolving issues in a physical meeting, which is pretty much easier than through a screen, to be honest.

Sure. And obviously you're from Spain and you've moved to London, you know, through your job. Do you find that, does your company do quite a lot of training for foreign nationals in other countries as well? So they get to see how the other offices operate, especially with regards to the audit methodology?

No, totally. When there is a change, for instance, in the methodology, or we changed recently, well, recently, four years ago, we changed the system that we are using for audit execution and so on. So we tend to have this approach to travel to the geographies, to have on-site trainings.

to make sure that local teams are aware of these changes, while also to learn from all the geographies about what are their needs, is there any change or anything locally required that we need to adapt or adopt into our methodologies, and so on. So, oh yes, again, the intensity has changed because this is a...

Mm-hmm.

Yeah.

a trend in the, I would say not just in financial industry, I would say in the whole world about contacting through the IT tools, but that human touch will remain.

show.

Well, I think it's important as well because it makes people understand other countries' cultures and really how to, yeah, how to sort of communicate really. Okay, great stuff. So I suppose, you know, you've done lots of things with Santa Handaire. I would be very keen to understand what's your biggest achievement working for the bank.

Totally.

So I would say we always try to remember more what is closer to your current situation. But I would say that the achievement that makes me really proud of our work and our effort is the creation of the team in London responsible for investment banking in Sand

Six years ago I was landing here alone and with the effort of, obviously with the help of all my colleagues in headquarters here in London, we've created a fantastic team of now we are 28 people working for InterNoloD in Investment Banking in London and I think that is one of the achievements that...

makes me really proud of what we have learned in the journey, because this is not just about what we are now. The beauty of this is the journey of how you build everything, how you adapt the methodology, how you start interacting with regulators, getting feedback from everyone, navigating, obviously, as all the organizations, the cost challenges.

attrition in the team, which in London is very normal and all these kind of things. I think now I look to the past, to the last six years and I think what we achieved here is really remarkable.

Because you've got quite a diverse team as well, which I think is quite important to say and your team is quite a stable team as well. And you've done quite a lot of internal mobility as well. So what do you think then in terms of the people that you've employed maybe internally that's not...

that's been out of audit that's come into internal audit. What skill sets do you think that internal audit offer that they haven't realized what they can achieve, I suppose?

Yeah, I would say many people that are coming from non-internal audit background, they approach internal audit as obviously the first impression. Sometimes it's like you guys are the team ensuring that the rules are being complied and so on. But then they really understand.

what is our role, the current role in the organizations of internal audit, which literally has evolved from the old times of being the wrong name about the policy of the organizations and just purely assurance work to a more advice and being partner of the business and the areas.

which I think is very valued by the people approaching internally from other backgrounds. Also, they recognize the value that we add on this role and also the adaptation that we have to the different areas that we are auditing because, as I said, usually...

Unless there is a very specialized team, usually they come from auditing some compliance regulations, they go then to more, let's say, numerical reviews, or even other kinds of reviews, like culture reviews that we are doing as well. So this diverse environment of work and...

touching a lot of areas, I think it's something that they value a lot.

Do you think then that people don't realise how much is involved in terms that you can actually become quite a product specialist especially sort of within the markets area or retail banking?

Totally. I think, and again, it looks like I'm just selling the function. I do really think that an internal auditor with experience and having touched a lot of areas will add in the future a lot of value to those areas because especially, at least in my organization, we dig into the...

Yeah.

very detailed things and processes. So we replicate a lot of controls, a lot of processes. And at least in London, our team are becoming more or less specialists in several areas, which is really valuable then for the organization. So in Santander, we tend to...

to call it internally like an academy of the rest of the bank because our people usually they tend to go to other areas to take roles in second line, in first line as well or any support functions and they work really well.

So would you say then that in Santander, internal audit has been more of a gateway? Do you get more people that sort of move into the business from your teams? Or would you say that they make their careers within internal audit?

I think it depends on first the motivation of the people, obviously, and also how we try to create the environment for them to be secure and confident of moving to these areas and that they are going to do really well. So in that sense, we've got several cases internally of people.

moving to compliance roles, moving to risk roles, moving to some governance and strategy areas. Recently we had a person going to a business unit, like transaction banking. So, and I think in general, these movements are really successful. So they are really prepared.

Yeah.

to go there and deliver since the very beginning of the movement.

I always thought as well, I always liked the idea that working within internal audit, you've got the opportunity to audit the departments that you possibly might like to go and work in so you know exactly what the manager's like and exactly how good they are at their job, right?

Totally. I always say this and some people in senior management they don't buy this idea, but I always say that apart from the CEO of a company, the other person who really understands the whole structure of the organization is the internal auditor because they understand the weaknesses in second line, they understand what is happening in the business.

Okay.

Mm.

They understand also what the regulators are asking the organization to deliver. So they are on top of all the spectrum of risks and issues in the organization that I just can't see the CEO being on top of these kind of things. You know, because the other C-suite professionals are more focused on the area of expertise. So risk is very focused on the numbers and so on.

Yeah.

compliance on regulations, but this overall view of everything, I think the only one selling this with the CEO is the internal auditor.

I totally agree. I mean, I definitely noticed a lot of the C-suite roles that we see. You know, the favoured candidates are normally somebody who has done some sort of stint within internal audit that, you know, can communicate and deal with the regulators. It's very important now. Okay, great stuff. And then do you feel then that...

Okay.

in terms of people coming into internal audit, then do you think that sort of people are still tending to stay within internal audit or just use it as a bit of a stepping stone just in general?

Well, again, I think it's depending on profiles. But it's true that right now, at least, you tell me probably more than I can say on this. But I'm seeing a trending internal audit to start embracing profiles from many areas of expertise. So right now.

Yeah.

Yeah.

in internal audit is very important, the IT background, because there is a strong tendency in all internal audit fields of automating processes, creating tools for continuous monitoring the risk of the organizations, and for that, obviously we need experts, right? And the tendency will increase with the so-called

chat GPT and all AI tools that are coming for staying totally. We will need to adapt our way of work to these new tendencies. We will need these new profiles. I will say I want to see this as a way to attract these kind of people of this talent and stay here for longer because...

because they know that we are a partnership with the senior managers and senior leaders of the organizations and they are going to be asking and demanding from us more of this kind of work.

So it sounds to me then really then going forward you foresee that any sort of business audit role will be more hybrid in terms that they will need some...

you know, a knowledge of technology or data analytics. So as a company, what will you, what will you do in terms of, offer more training for that? Or will you sort of go to market to look for those sorts of skill sets?

Peace.

So we've got different lines of work on this. First, we are hiding some profiles like engineers, IT engineers, mathematicians, and so on, to build our own tools in-house. And then these are brought out across the globe to all the local teams.

Bye.

giving training to them to use this. And then, obviously, here in London as well, we are rolling out a training program of these new technologies, like delivering Power BI trainings, ensuring that they are involved in all these developments that we are making internally, and so on. The idea is.

to start bringing obviously talent that we don't have in the team and also upskilling the team with this approach of new technologies, incorporating new tools into the VAEU because I think it's the future.

Okay. And do you think, and so do you think sort of bringing on maybe sort of graduate training programs of, I suppose probably I'm keen to understand that if you had somebody in data analytics for an example or somebody that's...

doing market risk in terms of putting them onto a graduate scheme into internal audit, what do you think the sell is to entice them to come and to do their graduate scheme in internal audit?

So it's very interesting because in London it's a fight that I'm having with our HR and they are more open now to these kind of things because it's true that some years ago maybe internally it was not so attractive, so sexy for the graduates to come and embrace the change of coming to these kind of areas but

Yeah.

Yeah.

Now more and more they are seeing this tendency and they are seeing that internally this is a place where we are piloting a lot of innovative programs like as I said, developing tools for research dashboard monitorings, creating automated tools to test the whole population of...

contracts for instance where we need to review certain contracts and For that we need to start say up skilling the team in that sense and They are coming more and more Approaching internal audit more and more

So I feel that you're saying to me that next year really, that sort of everybody in their audit plans or you believe then that really still data analytics is gonna be a very big area for internal audit next year as well as culture.

Totally, totally. I think first, obviously, yesterday I was in another event as well and one of the topics was about this. We need to break the ice on this and start getting more data analytics in our VAU, not just as defining indicators and so on, but really automating testing.

that we do in internal audit, like reconciliations, like analysis of alerts, independent analysis from the business, and these kind of things. And for that, we need to continuously incorporating these tools and using it more and more. I think that the first stone for making the change, I think, is to try and...

Yeah.

start embedding all these new tools. Totally.

And why do you think then culture, to all the internal culture, is now becoming such a big topic? Do you believe sort of COVID's brought that on or mental health or, you know, the fact of what people working from home to ensure that they're doing their jobs efficiently?

Thanks.

Totally. I think that is one factor. The other factor is the social movement on having a more diverse representation in all the estimates of our life. Organizations, governments and so on. So here in the UK we've got the example of the latest paper from the FCA about D&I, which I think is a real...

advance on this topic. And from Interloaded, obviously as I said earlier, we are becoming more and more partners of the senior leaders of the organizations and they are asking us and demanding us more and more to cover all these aspects of the organization because they are really worried about, are we having a really diverse team? And these questions.

Thank you.

Obviously, the natural position to make the question is to the internal audit. Can you help me to know if we are working towards the correct objective and we've got the right culture in terms of selling products, in terms of internal frameworks? Are we fostering internally?

collaboration, diversity, thinking customer, and these kind of things. And they are really demanding us to cover all these aspects more and more.

Sure. And I think you've just hit the nail on the head there. You know, Long On has the myth about, you know, internal audits just about ticking boxes. It is definitely more of a consultative role now to be able to guide and, you know, make sure everybody gets to where they need to be, right?

Totally. I mean, I think who thinks that internal audit is just a tick in the box role and we are just with sit papers and saying these are the controls I want to review is totally all-facial. Right now, the organizations demand us to be in the decision-making process, so they want us to be in the process of designing new...

Mm.

new activities or new compliance frameworks or new teams and they are asking us to be involved in these kind of things and to be involved from the beginning, not when everything has finished. They want us to be in the project committees, they want us to be in the process of...

of design for telling them guys you are missing this part or as per our experience we've seen this not working in this other area let's try this other way and they are really valuing this value that we are adding in this process.

And how do you think that's changed? Because you know, there was a very, especially sort of years ago, it was nobody really wanted to work in internal audit because there was no buy-in. Everybody used to see internal audit as the place. And do you think that that's just come from sort of CEO broke down to sort of change people's minds?

I would like to say that yes, that this is coming from the top, but I also, and this is just between you and me, I also think they were forced to involve us because the period of changes that we've experienced in the last 10 years, 15 years is incredibly huge in the industry and obviously they need...

Mm.

We've lived periods of uncertainty, and they want some certainty, some assurance that everybody was aligned to the strategies that they were setting up, and the things were progressing adequately. And again, the natural area to make these questions at that moment was internal audit. So it was like, again, I'm not saying that...

they were not thinking ahead of this, but they were a little bit forced for involving us on all these kind of things. And I think we did really well on answering these questions and attending these demands. So in general, they are very happy with the internal departments in many of the organizations that I've got colleagues in. And this is obviously increasing the...

Yeah.

the trust in our department and increasing the demand. So now we are seeing the race of the bar of the expectations from them on internal audit.

Yeah.

Sure, okay, that's great. Well, look, I suppose just to finish off, I won't keep you too much longer. We can have a quick fire. I've got five quick fire questions to ask you. So if you're ready. So tell me, what's one piece of technology you can't live without?

Okay. Yeah, go ahead.

I would say now is my mobile, my phone, and the iPad is, I take them even before the kiss of my house. So it's the first thing that you do.

And tell me, what are you reading right now then?

So at the moment I'm reading writing of the police investigations because I'm really very curious about these kind of things. And I'm always looking for new books about these kind of things. So it's really, really good. Yeah.

Hmm?

And tell me if you wasn't working for Santander is there a company or you know doesn't necessarily have to be a bank but a company that you admire quite a lot?

Well, right now I think everybody would say any tech company, which are right now the big players in the world. But I would also like to say some companies who are really doing things to have a better world for everybody and taking care of climate change and trying to...

to make the world the more sustainable that we can.

Sure, sure. And what's the best thing about working in internal audit?

Knowing people. I think probably when you are, I understand, when you are on the other side of the fence, you know, when an internal auditor is approaching you, maybe some people they don't like a lot, but I think it's important to have a positive attitude with them and making them aware that we are here to help. So meeting people and having...

Thanks for watching!

So.

good relationship with everyone, I think is the best of our role.

Yeah, yeah, well, that's all right. When an internal auditor approaches me, long as they're the first one at the bar with their wallet out, I don't really mind. And tell me, is there one question you wish I asked you?

Yeah. That is very safe.

So, yes, where do you see the market in the next years and how do you see it's going to be won apart from the, obviously, the financial backgrounds or whatever. The main characteristic that you think is going to be very valuable in the market.

So you're asking me. I think that from what I'm understanding is that data analytics, climate change, ESG and credit, especially on the counterparty credit side, is going to be busy next year. I think there's quite a lot of uncertainty in the market, especially around, I know everybody's talking about data analytics.

Hmm.

continuous monitoring has been going on for quite some time now. But really in terms of where that does lead the audit career, I personally believe that we're always going to need internal auditors because you're going to need to have the human side more than what a robot can do. But I think over the next year, it's going to be a lot of business as usual, just to see sort of...

how, what happens with our government and the world and yeah, business as usual.

Yeah, totally. Totally agree. I think sometimes I, at least in my team, I call this like data analytics 2.0 in internal audit because it's true, as you say. Some years ago, all these things started, but now we are seeing the second wave of this and more detail on what we are implementing and what we are looking for. Totally.

Yeah.

Yeah, well, I also think as well, it's about how you place yourself in the market and what you do to, you know, how you train, how you, how that company helps you to train. But it's like everything, you know, in my career, you always see internal audit sort of go up and down and new things happen and that's just life. It's how you keep on top of things, I suppose. But

Yeah.

Okay, well look, thank you very much for your time today. It's been great to have you as a guest and I'll speak to you very soon. All right, all the best, thank you.

Thank you.

Fantastic. Thank you very much.