This document summarizes challenges in the corporate actions lifecycle and opportunities for improvement. It outlines the key stages in the lifecycle and issues like increasing volume, complexity, and lack of automation. The top impediments to automation projects are difficulties building a business case and competing priorities. Without addressing these issues, firms may face losses, increased costs, and sub-optimal investment decisions. Regulatory changes are also creating new operational impacts. Overall, adopting standards and automation could streamline processing and improve data quality and timeliness, benefiting industry players.

1. Mitigating Risk in the Corporate Actions Lifecycle –
Challenges and Opportunities 2014 and Beyond
Kerry White
Managing Director
Brant Rock Advisory Services

2. Agenda
• The Corporate Actions Lifecycle and Issues We Face
• Factors Impeding Corporate Actions Automation Projects*
• Potential Consequences Of Not Addressing Issues
• Regulatory Impacts
• Conclusions
*Source: “Corporate Actions 2012: A Global Survey of the Corporate Actions Marketplace,“ Swift and CityIQ, 2012

3. Event
Management
Position
Management
Election
Management
Entitlement
Calculation
Posting
Issues At Hand
• Greater Volume
• Increasingly Complex Transactions
• Diverse Range Of Asset Classes
• Market-specific Nuances
• Lack Of Automation
• Multiple Platforms And Legacy Systems
• Financial Provisions To Protect Against Losses
The Corporate Actions Lifecycle

4. Factors Impeding Corporate Actions Automation Projects*
14%
11%
3%
3%
2%
10%
29%
9%
19%
Difficulty Building Business Case
Doubts About Attaining STP
Cost of SWIFT Messaging
No Impediments
We are Fully Automated
Lack of Management Buy-In
Competing Internal Priorities
Lack / Inadequacy of Solutions
Limited Return On Investment
*Source: “Corporate Actions 2012: A Global Survey of the Corporate Actions Marketplace,“ Swift and CityIQ, 2012

5. Potential Consequences Of Not Addressing Issues
• Missed Investment Opportunities
• Losses Due To Incorrect Instructions And Valuations
• Increased Costs And Reduced Profits
• Sub-optimal Investment Decisions Based On Incorrect Data
• Reduced Investment Performance

6. Regulatory Impacts
• Regulatory change is a global phenomenon
• Firms will be significantly impacted by a rapidly changing environment with multiple
changes to operational processes
• There is no shortage of initiatives:
• LEI
• MIFID2
• EMIR
• AIFMD
• CSD
• T2S

7. Conclusion
• Adoption Of Common Messaging Standards And Automation Will Streamline Corporate
Actions Processing
• Outcome Will Be Improved Quality And Timeliness Of Data
• There Are Still Challenges To Overcome
• Success Requires Greater Collaboration Among Industry Players
• Genuine Engagement With The Securities Issuer Community Would Also Help
• Increased Profits And Improved Investment Performance Should Accrue

8. Brant Rock
Advisory Services
Investment Operations and Financial
Services Experts