Streamlining Corporate Actions Data Management

In today's financial landscape, institutions face growing challenges in managing the ever-increasing volume and complexity of data. Corporate actions has emerged as a particularly thorny area, requiring sophisticated solutions to ensure accuracy, timeliness, and regulatory compliance.

The Corporate Actions Challenge

Financial services is getting increasingly data intensive with new data sources and new reporting requirements. Business processes are getting more data intensive and operations need to be streamlined to support data-driven strategies. Given the diversity of events and data sources, corporate actions has been a particularly challenging area for many institutions.

Regulations such as the revised Shareholder Rights Directive (SRD II) have introduced stricter demands on turnaround times between company announcements and client notifications. Meanwhile, departments beyond asset servicing—including research, middle and front office, and client reporting—require faster access to high-quality corporate actions data.

Corporate actions encompass a wide range of events: warrant issues, stock splits, mergers or acquisitions announcements, dividend announcements, and other capital distribution events. A prerequisite for effective management is tracking the relationships between issuers and issued instruments, including various listings and bonds.

The Cost of Fragmentation

A common inefficiency we observe across the industry is the duplication of efforts when different departments independently acquire and cleanse the same information. Global institutions particularly need a centralised data management facility to maintain this information consistently.

Another critical consideration is measuring how corporate actions data affects downstream applications such as portfolio management or index benchmarking. Events like stock splits and name changes often require manual intervention in these systems, creating operational risk. Ideally, business applications should automatically detect corporate actions data and apply the appropriate rules or formulae—reducing risk and improving efficiency.

A Structured Approach to Corporate Actions Data Quality

To address these challenges, a step-by-step approach to securing data quality is essential:

1. Preparing source data by determining the appropriate matching type, with criteria that vary by specific event type
2. Executing business rules based on matching criteria and available data sources
3. Aggregating data sets by linking corporate actions, securities, and legal entities to enable easy navigation and discovery

An effective corporate actions solution should offer:

• Complete event type coverage
• ISO15022/20022 compliance
• Robust data quality tracking
• Prebuilt multi-source integration supporting MT56X
• Comprehensive linking between corporate actions, issuers, and securities

The Business Benefits

Implementing a modern approach to corporate actions data management delivers significant advantages:

• Improved transparency of data demand and usage for optimal cost management
• Clear overview of the status of data sourcing, mastering, and distribution
• Exception handling processes and data quality metrics that optimise data management
• Data lineage ensures that source data and transformations are clearly captured
• Easy data access for optimal business user enablement
• Seamless integration between corporate actions data, issuer information, and financial instrument details

Moving Forward

As financial markets continue to evolve, the ability to efficiently manage corporate actions data becomes increasingly vital to operational excellence and competitive advantage. By centralising and automating these processes, institutions can reduce risk, improve compliance, and enable better decision-making across the organisation.