A Recipe For Success In Transformation Digital Proxy Voting Starts In South Africa

It’s reported that 70% of transformation programs fail. How can organizations defy the odds and undertake an automation and innovation discipline that delivers real business value? While every organization is different, there are a few common ingredients required in any transformation recipe.

People

Talent is one of the most critical ingredients to a successful transformation program. Identifying the right people to lead and support your transformation program, who are aligned on business value and accountable for meeting objectives, are essential first steps.

How to construct an effective transformation team:

1. Build a multi-disciplinary digital business team that sits horizontally across the organization. Their holistic vantage point across complex programs will ensure solutions are designed with maximum re-usability.

2. Appoint a dedicated IT team skilled in emerging technologies. This team should be creative and approach problem solving through a clear lens, using new and emerging technology solutions.

3. Align Subject Matter Experts (SMEs) who are responsible for achieving transformative outcomes as a primary responsibility. Automation and innovation should not be side gigs to existing operational duties. SMEs are vital in providing the business and industry knowledge that ensures the solutions achieve the intended results.

Technology

Intelligent automation platforms made up of microservices are accelerating transformation programs everywhere. Gone are the days of costly and timeconsuming overhauls and replacements of legacy enterprise solutions.

How to accelerate your transformation program:

1. People and Platform: Selecting the right technology platform is not enough. Automation platforms put capabilities into the hands of business users through a democratized approach, that together can quickly solve for shifting business dynamics, client demands and market practice. User configurable technologies bring innovative solutions closest to those who are best versed in the challenges that need to be solved.

2. Data: Underpinning your technology stack with a clear data strategy that is pragmatic and solves business challenges is key. Process and transformation teams need unfettered access to quality data to successfully deliver on automation strategies. Understanding where your data is coming from, its lineage, quality, and accuracy is critical.

3. Governance: Building a governance framework is an essential tool for evaluating when to leverage an automation platform versus other technology solutions. Bring together experts from Product, Systems, Data Management, Risk and Control to evaluate tool selection, data sourcing strategy, design, and scale through a repeatable and scientific governance program.

Measuring Success

Measuring productivity or reduction in FTE is often the default metric many transformation programs use to define program success. This output-based approach can be problematic. Instead, you should focus on an outcome-based approach that leads to longer term benefits such as new idea generation, improved client experience, and advanced analytics.

Important ROI measures:

• Enabled capacity

• Simplified architecture

• Reduced deployment costs

• Risk reduction

• Client experience

• Accelerate organizational placement

• Workforce upskilling

Once measures are agreed upon, progress and tracking should be highly transparent to the stakeholders and the organization.

The Takeaway

Transformation must start with an organization’s most important ingredient: its people. Layer in the right technology and focused measurement to defy the industry odds with a successful transformation project.

Catherine Dawson Senior Vice President, BBH Kevin Welch Principal, BBH

A combination of technology developments and Covid-19 proving AGMs don’t have to be physical, e-voting in Africa is making significant strides.

Palesa Banda, Head of Custody Product at Standard Bank South Africa explains how e-voting is taking shape in South Africa.

Proxy voting process in Africa has several challenges hindering its effectiveness and inclusivity. Weaknesses and inconsistencies are notable in the election and voting administration across the value chain, which may include inaccurate shareholder lists, delays and omissions in vote distribution and incomplete vote tabulation. These issues are an outcome of out-dated voting processes across Sub-Saharan Africa.

Move away from manual processes

The current proxy voting process in South Africa is largely manual. Votes are not all cast electronically and the dissemination of votes via intermediaries is still executed on spreadsheets. Embedded in the manual process are operational and market risks that ultimately impact the beneficial shareholder. To achieve operational efficiency and to mitigate risks of voting errors or missing response deadlines, a shift to electronic voting platforms and digitised voting means is warranted.

The SA market is shaped by a highly regulated environment, clients continue to seek increased transparency for shareholder governance and disclosure.

New systems and collaboration bring change

This is changing as new systems enable electronic voting, proxy delegation and better voting deadlines within the value chain. Investors are looking for faster and digital access to proxy announcement and a secure voting process which ensure inclusion of every vote and confirmation to shareholders. In addition, there are demands for a streamlined voting for multi-banked asset managers / owners on a single platform that provides real-time, transparent data with audited vote tracking.

Developments in the SA market

In 2019 the CSD, Strate, launched an electronic voting platform and hosted its first AGM via e-voting. Service providers such as Broadridge and Proximity are responding to the call to move to electronic voting as seen in the recent launch of electronic platforms and enhanced proxy voting processes. Standard Bank is a big advocator for fully digitising the voting environment and took the lead as the first custodian to partner with Strate to enable electronic voting for one of the largest asset managers in 2021. In 2022 Standard Bank partnered with Broadridge to successfully test proxy voting integration that will achieve an end-to-end processing to create a better voting experience and better voting deadlines for clients.

Key features of robust e-voting applications:

• Remote voting

• Voting rights delegation

• E-voting for certificated and uncertificated securities for local and foreign listed firms

• Support complex account structures

Investors embrace the change

It is with the Covid-19 pandemic that markets witnessed a shift towards more electronic means of exercising votes. In several African markets, we observed the relaxation of restrictions associated with physical meeting attendance and a greater inclination for virtual meetings. Domestic investors are seeing the possibilities of change and ready to adopt global best practices to bring higher level of shareholder participation resulting in better corporate governance in African markets.

Standard Bank is the leading custodian in Africa by assets under custody with experienced on-the-ground experts in 14 markets. The bank is leading several advocacy initiatives to improve proxy voting across its markets.

Palesa Banda Head of Custody Product at Standard Bank, South Africa