Achieving Regulatory Compliance Through Innovation

SIX is currently on a winning streak in the corporate actions category. How does it defend its position year after year?

Corporate actions is the core strength of the company. For us, corporate actions is not a side business, but our core business. The better you get in this field the more customers rely on you, and the more feedback and opportunities you get to improve the service. Especially over the past few years, we have created services on top of our corporate actions offering, which allows us to learn more about our own product too.

Why did SIX decide to strengthen corporate actions for funds in the past year?

Previously, customers had to combine data from SIX, fund manufacturers and different specialist companies, and this data would come in different feeds in different formats. We decided to help customers by partnering with some of those firms and augmenting the data with direct sourcing from some companies. This also helped with our offering for the revised Markets in Financial Instruments Directive (Mifid II) because some of that data was required for compliance.

One of the initiatives SIX has been celebrated for in this year’s awards was the launch of the Regulatory Hub. What problem does this initiative help solve?

We saw new regulation coming in the form of Packaged Retail and Insurance-based Investment Products, Key Information Documents and Mifid II, and these initiatives required a system for connecting distributors to manufacturers. The regulation came before the infrastructure to connect the buy side to the sell side—interactively and with a digital audit trail—was established.

What challenges did SIX have to overcome to launch the Regulatory Hub?

The biggest challenge was putting the data into a normalized format that customers could consume. The only way to integrate the data is if it is consolidated and normalized, and we had to do that in a way that was auditable and in real time. We’re up to 20 million documents now and, since January, we’ve been adding around a million documents a week.

SIX also won an award for its work on tax data. What made the Inland Revenue Service’s 871(m) data service release stand out?

We worked very collaboratively with customers because this is very detailed and complex regulation. We deliver it to the client as a plug-and-play service, and this has been extremely well received in the market, as European wealth and asset managers have been making sure they are compliant. 

This was an opportunity for SIX to shine; it really plays to our strengths. We’ve been getting into the weeds of the regulation and the details of derived instruments to deliver a comprehensive utility service so clients don’t have to do it themselves or worry about what they are missing.

What other areas within tax regulation can SIX provide similar services for?

We’re looking at broadening our tax data services and have more than 30 tax services to date. SIX is very well known in Europe for tax compliance data, and we’re expanding in this segment. As tax has a bigger impact on clients’ returns, we’re looking at what we can do for clients as an industrial utility service that allows them to focus on their core business, serving their customers with comprehensive and transparent information.

What can clients expect from SIX in the coming year?

One of the big developments for SIX in the past year was the introduction of corporate actions available in a new self-service data delivery system, SIX Flex. Customers are increasingly focused on the cost of ownership of data, and don’t want the burden of managing complex technical implementations. In Switzerland, most take data via our Valordata Feed, but the new system, launched in November 2017, gives us an opportunity to offer a plug-and-play solution with little to no technical integration work required. Clients can determine how often they want the data, and we make it very easy for a non-technical person to focus on the fields that they want to get and determine the way they want to receive it. We decided to start with corporate actions, which is becoming increasingly vital and more complicated every day. Over the course of this year and next we will continue to expand the content services available via Flex to help ease the technical burden of data management for our clients, and to help them serve their own customers more effectively, with high‑value information.

 

Read more about the IMD/IRD Awards 2018 winners

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