AST, a leading provider of transfer agent, proxy solicitation and governance services, today announced that it will introduce a blockchain-enabled system for proxy vote tabulation by the start of the 2018 proxy season.
The new solution will be the first in a forthcoming suite of offerings based on distributed ledger technology (DLT) that AST plans to bring to market in the coming years.
In collaboration with NuArca, a blockchain-focused solution provider, AST is accelerating the rollout of its offerings based on blockchain technology and exploring how it can leverage the technology to enhance its client-facing solutions, including proxy voting and recordkeeping. Under the leadership of President and Chief Executive Officer Brian J. Longe, AST has been testing various applications of DLT and has already developed a working prototype that demonstrates the capability and value of blockchain as an underlying technology.
AST and NuArca will work together to pioneer advances in proxy analytics and reporting that utilize immutable blockchain results and real-time facts to support issuers in the creation and execution of successful proxy campaign strategies. This solution will facilitate greater transparency and confidence in data handling, allowing issuers to make more informed decisions and strategy adjustments. It will also allow AST’s proxy solicitation experts to access advanced predictive analytics to guide complex proxy solicitations.
“AST recognized early on the value and efficiency that blockchain can bring to our business and to the industry as a whole,” Longe says. “As we look to the future, we plan to leverage internally-developed DLT as well as best-in-class third party blockchain solutions to enhance our core services, ultimately improving shareholder experience and engagement.”
Each year, AST acts as agent and/or tabulator for annual general meetings for approximately 20 percent of U.S. issuers. D.F. King & Co., Inc., an AST company and a leading proxy solicitation firm, provides in-depth analysis and governance to guide issuers in structuring proposals and campaigns that achieve management objectives. AST is also a leading mutual fund proxy solicitation agent. The company views proxy voting, which requires immutability and transparency above all, as a great use case for its first blockchain solution.
“While there is plenty of buzz in the industry about blockchain’s potential, few firms have been able to move from the ideation and development stage into the launch of real-world applications,” says Todd Cooper, Managing Director and Co-founder of NuArca. “The blockchain-based proxy voting solution that we are developing with AST will result in a targeted solution that will deliver real value in the coming year.”
“NuArca shares our vision of deploying new technologies to improve business processes,” adds Chris Jutkiewicz, AST’s Chief Technology Officer. “As we continue to advance all AST platform capabilities, especially those that provide value directly to our clients, blockchain will serve as a critical element of our architecture, certainly for proxy and as a foundation for other solutions.”
AST’s collaboration with NuArca reflects one of many new initiatives for the company under Longe, who was named CEO in January 2016. This March, AST announced an enterprise-wide rebrand and organizational alignment that demonstrate its investment in resources and infrastructure designed to optimize access to services for its clients and partners. Late last year, the company’s Canadian arm, CST Trust Company (CST), launched a Structured Financial Services unit, allowing CST to bring its proprietary technological innovations to Canada’s mortgage custody industry. Looking forward, AST is exploring additional uses for technologies like DLT, including in areas such as Ownership Intelligence as well as user interfaces of its client-facing systems.