Battling Inertia In Corporate Actions
![michael-shashoua-waters michael-shashoua-waters](/sites/default/files/styles/landscape_750_463/public/import/IMG/317/167317/michael-shashoua-waters.JPG.webp?h=acfe3244&itok=ceJMABf4)
Reflecting on the corporate actions webcast conducted last month, we saw ongoing concern about some of the same automation issues that have been at the forefront of the discussion for months and possibly years.
That similarity extends right down to the responses to a poll question from a March webcast that was re-asked in this event, concerning what parts of the corporate actions lifecycle firms have automated. In both instances, we allowed respondents to choose more than one response, and still the percentages of the responses were nearly the same:
• Event management—July, 46%; March, 55%
• Position management—July 41%; March, 39%
• Election management—July 26.5%; March, 25.5%
• Entitlement calculation & posting—July 25%; March, 24%
• No parts of the process—July 32.5%; March, 29%
The repetition is reminiscent of a memorable moment from the 1990s US television series "Homicide," a critical and personal favorite. Its very last episode, "Forgive Us Our Trespasses," began with a montage of Detective Bayliss, played by Kyle Secor, repeatedly going to the courthouse for several attempts to begin a murder trial, thwarted by the lack of one resource or another—the first time, no courtroom is available; the second time, the prison doesn't send the defendant over; and on the third and final try, the district attorney is tied up and can't attend.
As with Bayliss' courthouse odyssey, corporate actions processing has several pieces and steps that all have to fall into place to proceed. If any one of these is missing, the defendant goes free or the corporate action won't get processed correctly. In large institutions, it's a challenge to find some way to correct the problem short of—spoiler alert—going vigilante as Bayliss does.
In this latest webcast, SunGard XSP's Daniel Retzer coined a "Next Two Years Effect" title for the inertia of firms' pushing back plans to automate corporate actions processing. Barclays Capital analyst Selvaraman Ponniah, speaking about messaging standards issues in corporate actions processing, said regulatory or industry pressure is needed to spur change. This could be true for automating all the other aforementioned parts of the corporate actions process.
While a financial services function like corporate actions processing is unlikely to get a vigilante that would be effective in forcing improvements, it's become apparent that momentum must be built and propelled from somewhere, by somebody.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@waterstechnology.com or view our subscription options here: http://subscriptions.waterstechnology.com/subscribe
You are currently unable to print this content. Please contact info@waterstechnology.com to find out more.
You are currently unable to copy this content. Please contact info@waterstechnology.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@waterstechnology.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@waterstechnology.com
More on Trading Tech
BlackRock to integrate Aladdin and Preqin to create new private markets platform
CEO Larry Fink calls combining the two platforms “maybe the biggest opportunity in 10 years.”
Ace high or busted flush? Digital Asset’s mixed fortunes mirror DLT adversity
The vendor hoped to remodel post-trade using blockchain technology—and it still might—but its bumpy progress raises questions over the future of DLT in finance.
This Week: BlackRock/Preqin, Trading Technologies, FIA Tech and more
A summary of some of the past week’s financial technology news.
Adaptive’s Aeron goes live on Microsoft Azure Marketplace
The messaging software used for building bespoke trading platforms is now available on Microsoft’s marketplace, making it accessible through major cloud providers.
Bloomberg, industry bodies push back on Cboe’s proposed OEMS rule change
Some industry bodies disagree with the options exchange’s proposal to carve its Silexx OEMS out of the SEC’s definition of an exchange facility and place it into a separate business line.
Waters Wrap: CME, Google and the pursuit of ultra-low-latency trading
CME Group and Google have announced Aurora, Illinois, as the location for the exchange’s new co-location facility. Anthony explains why this is more than just the next phase of the two companies’ originally announced project.
WatersTechnology latest edition
Check out our latest edition, plus more than 12 years of our best content.
Natixis refines in-house interoperability model
The French asset manager has refined its canonical data model over the last decade, as the interoperability movement continues to evolve.