As key players in the global financial community gather at numerous conferences, including SIBOS, in the last quarter of 2022, Proxymity reveals how technology is increasing shareholder democracy and engagement
Multi-million pound investment rounds in banking are commonplace. But a £52 million investment last December caught the attention of the investor community. It was not just the size of the investment but the identity of the stakeholders that followed Proxymity’s Series A investment, and the new additions that joined the consortium, that held the industry’s interest.
Not only does this consortium represent eight of the world’s largest asset servicing providers, but also companies that compete globally for market share.
As seven of the top ten global custodians, they hold over US$200 trillion in assets under custody. So who, and what, had persuaded them to join forces and openly collaborate as a consortium?
These financial giants have been brought together by Proxymity, the digital communications platform.
The brainchild of two experienced industry experts — Dean Little and Jonathan Smalley — Proxymity’s vision is to change the way the industry communicates.
Proxymity’s investor communication platform as a game-changer
Smalley, who worked for Citi for over 10 years before co-founding Proxymity, explains: “Our vision is to fundamentally change how investor communications works. In short, we felt that there was a need to create a more transparent and accurate digital ecosystem, which people would find quicker and easier to use.
“That is why our product, which delivers the benefits of innovative digital investor communications to everyone in the banking community, is backed by some of the most influential names in the sector.”
Take Deutsche Börse Group, one of the world’s largest market infrastructure providers. Samuel Riley, who heads Deutsche Börse’s Clearstream Securities Services, says: “Proxymity’s goal of efficient and transparent investor communication is fully in line with Deutsche Börse’s vision. Hence, this joint collaboration will significantly improve our client’s experiences throughout the securities life cycle.”
US multinational investor bank, J.P. Morgan, said it was equally excited to be part of Proxymity’s next stage of growth.
Hannah Elson, J.P. Morgan’s head of global custody, comments: “We continue to utilise the Proxymity platform, helping to ensure it achieves scale for digital communication throughout the industry ecosystem, benefiting clients and supporting corporate governance.”
Antiquated processes
Although technology is transforming the asset servicing landscape, Proxymity, with its network of intermediaries and issuers, is well placed to solve industry issues. However, it does require markets, and those that operate in them, to continue their trajectory of adoption.
Proxymity has made great progress in many markets, and most recently announced that more than 50 per cent of the FTSE 100 have now connected to the platform.
As Smalley outlines: “Many of us are linked to each other, but we are only as robust as the weakest analogue process. Our clients and investors understand this, and they are demanding more, driving change with us every day.”
Proxymity solutions
Proxymity provides digital proxy voting and real-time shareholder disclosure services, which enable banks to identify shareholders and automate shareholder ID requests using Proxymity’s digitally connected ecosystem. Its fully digital Proxymity Vote Connect technology allows meeting data, votes, and much more to be sent and received in real-time. Proxymity’s solutions enabled Computershare, an Australian-founded but globally operating issuer agent, and enhanced its services for its issuer clients.
“By working closely with Proxymity, Computershare can more effectively connect custodians, institutional owners, and issuers when voting takes place in the UK and Australian markets — and we expect this collaboration to progressively extend to markets elsewhere in the world, too,” comments Paul Conn, Computershare’s president of global capital markets.
However, for many in the industry, both products have offered liberation and empowerment. They have not only brought people closer to shareholders, but have enabled organisations to increase shareholder engagement, corporate governance, accountability, and transparency – which in turn promotes greater shareholder democracy.
Shareholder democracy
New technology allows better access, and thus, greater inclusion. Greater speed and transparency facilitates better understanding and more time to research those all-important investment decisions.
Technological advances also improve the reverse flow of the data — from shareholders back to companies. Knowing who they are enables better stakeholder engagement.
This makes it possible for clients to better grasp the challenges they are experiencing, and more broadly, gauge how major events outside of banking — such as the COVID-19 pandemic, and the cost-of-living crisis — can affect and influence behaviour.
Most importantly, however, closer engagement allows our clients to give shareholders what they want. Today, most want shareholder democracy.
They want to have a greater say on corporate governance — that means giving shareholders some influence on how an organisation operates.
Shareholder democracy is also about ensuring greater transparency as to who is elected, while making boards more accountable to shareholders.
For Dean Little and the consortium of ten investors, Proxymity’s products provide tangible evidence of the benefits that digital connections are bringing to the ecosystem and the industry as a whole.
Little affirms: “In the last two years, we have seen demand for our services rise inexorably. The deployment of Proxymity’s platform brings real and immediate benefits to the investor ecosystem.
“Our mission is not just to continue to provide transparency, speed, efficiency and quality to the market. We also see technology as a crucial tool to help those in the chain of custody to promote better visibility and governance. That represents an exciting step-change, and it is one that we are proud to facilitate.”
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