Technological Innovation, Shareholder Experience Top Priority List for Corporate Issuers, According to New AST Survey

Monday, June 11, 2018 - 08:17

AST announced the results of a survey designed to uncover corporate issuers’ needs, wants and concerns. Chief among the findings was that corporate issuers are embracing new technologies as never before and view them as the key to providing better service to their shareholders.

The survey respondents named shareholder experience as the number-one area of their business that would benefit from improved use of technology (31%), followed by documentation availability, website improvements and security (each at 19%). Respondents said they desire tech-enabled customer service that can offer seamless connections that enable them to more accurately understand and communicate with their shareholders.

“AST is committed to supporting the issuers of corporate securities with the strategic application of transformative technology and expert advisory services,” said Marty Flanigan, CEO of AST. “The insights we’ve gained from this study further inform our understanding of what corporate issuers desire to serve and communicate with their shareholders, helping us to innovate in a way that best meets their needs.”

Technology and the Shareholder Experience

AST’s study, which included both personal interviews and a questionnaire, queried industry leaders who are involved in providing services to their companies’ shareholders and who have responsibility for selecting their companies’ service providers. The study showed that these leaders envisioned interconnected computing power that removes obstacles to the flow of information from one system to another. In addition to a more accessible and user-friendly Internet presence from their providers, respondents also expressed their desire for greater robustness, speed and ease, increased self-administration and a better human interface.

The study homed in on the challenges to servicing shareholders posed by various applications and technologies. One specific priority named was the need for shareholders to be able to manage their accounts independently. As one respondent noted, “The Interface should be easy to navigate and options should be clear and succinct. Also, one of the biggest frustrations that we frequently hear from our shareholders when calling in is that they have to press too many buttons to get to a live representative.”

Respondents also believed that technology should be able to assist with mitigating improper escheatment of funds, communicating with service providers and providing automated email notification to shareholders when there is activity on their accounts.

Technology and the Corporate Issuer

When asked about technological solutions for themselves (on a scale of 1-5, with 1 being not at all important and 5 being very important), the corporate issuers surveyed emphasized the role of technology in improving accuracy (4.76) and reducing mistakes (4.71), accounting for the human element at every level. Across the board, respondents agreed that developing technology solutions is critical to enhancing the speed of accessing information (4.47) and the ease of providing information to shareholders (4.59). Internally, they desired smoother information flow between systems and people for greater self-service and information access. Issuers also said they want technology to help them stay abreast of regulatory changes.

The vast majority of respondents shared their belief that technology is a complex discipline that often requires a different skill set from that which they personally possess. Important to executives was the need to understand technology in layman’s terms (4.35). This conviction stems from their shared experience of needing to answer technological questions regularly and sometimes under pressure, even when the technologies in question will be many years in development. Respondents also said they believe that technology is an investment that providers should make to show their commitment to the executives’ businesses (4.24).

The study showed that executives desire to be kept more up-to-date with new developments in regard to data and analytics. Most believed that sharing data is imperative, but said they want providers to work out the details and regulations of data sharing first. When evaluating a list of potential data applications, respondents expressed interest in historical analysis of data, peer and trend analysis, predictive analytics and shareholder demographic analysis.

Data Safety and Security

While data safety and security were high-interest topics, many respondents believed that between their own in-house efforts and those of their providers, the technology protecting shareholders from hackers and criminals was in good shape.

Others, however, professed more uncertainty on the topic, citing particular worries about possible identity theft, especially in light of recent, highly publicized releases of information and privacy concerns surrounding consumer-centered businesses. Many issuers cited worries as to whether current technology can provide the necessary security for their shareholders.

Respondents were most supportive of service providers’ protections such as firewalls, encryptions and any technology that would protect shareholders information (4.53). Service provider secure storage solutions were also rated highly (4.24).

“What the study demonstrates is that industry participants see many areas in which technology can help them leverage readily available benefits. Corporate issuers are hungry for new ways to streamline and better integrate technology into their shareholder and data security,” added Chris Jutkiewicz, AST’s Chief Technology Officer. “AST values our partnership with the corporate issuer community and will continue to be a leader in using technology to forge the future of the industry.”

About the Study

The study was conducted for AST by Vincent McCabe, Inc. between January 15 and March 15, 2018. Thirty-nine individuals representing a cross-section of businesses and job titles participated in the study, including AST clients, non-clients and members of AST’s Executive Advisory Council. A two-phase process was employed: Phase 1, Investigative – personal interviews with both clients and non-client corporate issuers; Phase 2, Predictive – both personal interviews and a quantitative survey. All the executives who participated are actively involved with services to their shareholders and their corporations and have responsibility for the selection of service providers. Overall, the survey trended strongly with a high degree of concurrence among the participants. The study is statistically directional, providing descriptive analytics.