Victor Anderson: Welcome to the 2021 buy-side technology awards, winners interviews. Now, IHS Markit won three categories in this year's awards, one of which was the best buy-side Corporate Actions platform. Its second such win in this category. Now I have with me today JD Singh, Managing Director and Global Head of Sales for pre- and post-trade solutions and corporate actions at IHS Markit. So, first up, welcome JD and thanks for spending a little bit of time to speak with me today.
JD Singh: Thank you, Victor. It's my pleasure being here.
Victor Anderson: Good, good. Okay. So, as I mentioned, at the top of this interview, IHS Markit's corporate extra solution was responsible for delivering the win for the firm in the best buy-side Corporate Actions platform category in this year's BST awards. Now, JD, can you talk me through the highlights of what IHS Markit has added to the platform over the last 12 months, because I gather it’s been a really busy and productive year for IHS Markit in this particular realm.
JD Singh: Sure, again, thank you for having us. And we're very pleased to win this award. I think if you look at where IHS Markit has come in the last number of years, we now offer industry leading end-to -end corporate actions, both data and processing solutions. And you're right, in the last 12 months alone, if we looked at some of the things that we've done, we've done a brand-new state of the art, low-code, configurable user experience - it was key for us to develop new risk and control dashboards. Again, you know, we have these offerings that transcend from large organizations’ hosted solutions, but also very scalable solutions for small hedge funds and asset managers. So, a new pre-configured standardized, hosted SaaS solution was key to what our customers were really demanding. So, allowing buy side and sell side firms to onboard as quickly as within four months, you know, really allowing them to realize benefits in a very short timeframe, and lower the total cost of ownership.
Victor Anderson: Yeah, I guess kind of the key message here is time-to-market. It’s something that certainly I'm hearing from a lot of players, a lot of end-users, buy-side firms especially, they're looking to get to market, they're looking to get up and running with any platform that they're implementing as soon as possible, because time is of the essence right?
JD Singh: Absolutely. I mean there are certain things are pushing them that way. So, some is driven by the fact that the COVID pandemic has shown people that we do need to have robust technology solutions that allow people to be able to onboard and work seamlessly. SRD II requirements for shareholder and disclosure, communication across meeting lifecycle is imperative. And having those integrated proxy solutions was key for some of our customers. So again, time to market was critical for customers, particularly some of these regulations moved fast, and that we've developed support for things like CSDR. You know, these are things that sometimes start slow, but then move very fast. And again, we at IHS Markit, and particularly in the world of Corporate Actions and Post-Trade Solutions are always focusing on how we can help our customers become optimally efficient and lower the overall cost of ownership.
Victor Anderson: Good. Okay. JD let's talk about the Corporate Actions market generally. And it's I think it's fair to say that it's dominated by a relatively small number of large, well established players. So how does IHS Markit differentiate itself in this particular marketplace? What do you typically hear from your clients that strikes a chord with them? And typically, why do they sign contracts and partnerships with IHS Markit?
JD Singh: That’s a great question. I think if you if you look at the landscape, you're right, there are some wellestablished names that people will always go to, and there are some new entrants in this space. I think what you have to look at is kind of where IHS Markit’s evolution has come from. If you go back about eight years ago, we started the journey in the world of corporate actions, really, with the acquisition of DTC's GCA business, which was a managed service for corporate actions data, right, and allowed us to capture data. So that was the first part. And so, we built that business, and we did a lot of transformation around that business to really bring it to where we think it really is optimally delivering high quality, full transparency, full audit trail, around the golden copy of golden record data that is required to process, so that's the first thing. Before you start talking about software, you have to get the data right. So, we focus very heavily at IHS Markit, on getting that absolutely critically done at the best in class, so we have that solution. And then with the acquisition of Information Mosaic a couple of years later, we really completed the end to end.
So today when customers are engaging with us, and are talking about the challenges we face, I mean, make no mistake, the corporate action complexities have only increased, the pandemic has done that I mean, a year ago, 98% of dividends were cancelled. And that was causing huge pain in the market. You know, when Disney and Fox merged together, you know, a simple merger, you would think of two of the biggest names in the US market caused huge issues for customers who were dealing with those securities. So, our data service, our Managed Data Service allowed our customers to be ahead of the game, and not dealing with the pain around getting the data correct. And then our processing solutions allows them to do the critical downstream processing. So that's the engagement that we have with our customers, we don't just say we're industry leading end to end solution, we actually show it. So, our solutions today use over 250 customers globally, across the largest buy side, sell side, small hedge fund, it doesn't matter. If you're in the space of financial institutions or managing holding securities, we provide the complete solution end to end. And when you look in the marketplace, there's one provider, one partner that can do both.
Victor Anderson: Good. Okay. Now, you mentioned kind of challenges pertaining to the buy side. So, let's drill down into that for a moment. JD, what are your clients most struggling with right now, from a corporate actions perspective? And how is IHS Markit as a business helping them to address those challenges?
JD Singh: Yeah, so if you think about particularly the buy side, and particularly when you start thinking about the organization that traditionally have done things very manually, you know, it's a very manual process, a lot of it, believe it or not, was still done in Excel spreadsheets. But the challenge now for customers is that the volume and complexity of Corporate Actions has increased and is increasing on an annual basis, so innovation and automation have become key drivers to help improve that client experience. So, what we've done with our Corporate Actions SaaS solution is a highly automated cloud-based solution, which allows our customers to be up and running within a 16-to-20-week window. And what we realized from that, is they get an integrated data and software solution. So our managed Corporate Actions validated data service, which gives them access to over 4 million securities scrubbed, with over 200 sources, which is supported by our 350 global subject matter experts in the corporate action space - they get that along with a fully integrated dynamic risk management engine on corporate actions processing. So it's a complete solution that allows firms that were struggling and being challenged with the complexity around corporate actions to really be able to effectively do their business, because the challenges of doing things manually is at a point where it's at breaking point. Small firms that typically could put one or two bodies on the project have realized that they just cannot contain the severity of the volume that's coming through both on the data side, but then also on the financial side, being able to process election effectively, is a challenge and having workflow tools is important.
Victor Anderson: Clearly the situation is unsustainable, and you can't just keep throwing bodies at the problem, hoping that you're going to sort out the mess of ramp up and volumes of corporate actions messages, right?
JD Singh: Absolutely. And you made a really good point, and in the older days, and I say older days, you go back a few years, you may think you can throw bodies at the problem. Now, as we know, hiring staff training, staff retaining is a big challenge. The pandemic now has shown that people are much easier to move because they're working from home. You know, we are obviously an organization that have embraced the change, we have our people in all locations all around the world. But that's the other challenge, our customers are now saying we're losing a lot of those key subject matter experts. So they need to have the right solutions in place, because they can't just rely on a body anymore, either.
Victor Anderson: Good. Okay, JD, let's talk a little bit about the future now. And what can we expect from IHS Markit corporate actions over the next 12 or so months in terms of new features and functions? Are you in a position to comment on what's on the workbench so to speak right now, that your clients really ought to know about?
JD Singh: I mean, there are a number of things that we are looking at, and we always are. We always think it's very important that as a firm and as a business that you're always evolving because our customers’ needs are always changing. So again, we work very closely with our customers. I would say one of the big things about our business and again, why customers adopt IHS Markit solutions is that we have a monthly working group where we have all of our customers join, who take our corporate actions solution and we discuss with them all those types of challenges and upcoming challenges, in the future. So, whether they're data specific, or whether they’re processing specific, those are the things we will address and discuss and always be looking ahead to. We're always looking to enhance our post-trade platform to become a one stop platform for issue and digital asset custody, right, enabling the safekeeping and servicing of crypto assets. And that's a big thing now that our customers are looking into. We are already in talks with a number of key participants about how we're going to deal with that. So, you will probably hopefully, in the next four weeks or so, hear about what we're doing in this space, because we're going to hopefully come out and make an announcement in terms of our corporate actions solution and crypto assets.
Enhanced corporate actions data coverage, we know there’s a huge challenge with our customers with open funds in the US, UK, Ireland, Brazil, sourcing of this information is very difficult. So, we've gone direct to issuers and agents that we’re working on a whole process around that to improve and enhance that for our customers. We're expanding our post-trade platform to support institutional brokerage and more complex transactional processing and flows on equity derivatives. So that's a big piece that's coming up. We again, we're in the process of in the next six to twelve months. And again, you know, we do a fully managed outsource service, which allows us to bring in our customers custodian information, bearing that to our service, which is called agent validation. So, we're going a huge improvement in that area, allowing customers to entirely outsource those critical functions of corporate actions announcement capture and in scrubbing against the custodian data. So that is another part that we've done and more to come in the next few months.
Victor Anderson: Good, good. That's a great point to end our conversation on. JD that just leaves me to thank you very much for making yourself available to chat to us briefly. And also, let's not forget congratulations to you and of course to IHS Markit on this wind in the Best Buy side Corporate Actions processing category in this year's buy side technology awards. Congratulations.
JD Singh: Thank you, Victor. Appreciate it.