There is a pressing industry need for automated corporate actions solutions rooted in high quality corporate actions data and technology infrastructure, according to a survey by SIX conducted among leading global asset managers, wealth managers, custodians, clearing houses and investment banks.
The survey - conducted from March until May 2021 across Europe, North America and APAC for the second consecutive year - showed that over three-quarters of respondents (78%) still process part of their corporate actions manually, with 40% processing more than half of their corporate actions in this way. Just under half of all respondents (49.1%) cited legacy technology as their greatest challenge standing in the way of them automating their corporate actions processing.
Despite the current lack of automation, nearly half of the respondents (47%) said they were looking for the near real-time delivery of corporate actions. There was a significant change, however, in the number of respondents looking for intraday delivery of corporate actions ― 30.9% in 2021, up from 12.9% in 2020. What these results show is that there is apparently new demand for corporate actions data delivered at various intervals during the day.
The increase in number wanting nearer to real-time delivery of corporate actions is in conjunction with important business drivers for increased automation of corporate actions processing, with respondents highlighting reduced operating costs and regulatory compliance as the two most important factors. In terms of asset class focus, market participants are looking for additional detail around their corporate actions, specifically when it comes to equities and fixed income.
Commenting on the results, Annelotte De Nanassy, Senior Product Manager, Financial Information at SIX said: “There has never been a more pressing need to process the corporate actions messages accurately and efficiently, but this can only be achieved through automation. Ultimately, firms need to integrate high quality data and timeliness in the provision of that data to maximize the automation of front and back-office operations. This will in turn free up staff for more complex tasks; including events that require constant back-and-forth between the team and the client, such as an IPO or M&A.”