How well are you managing investor data?  


Investing 4 years ago
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The true cost of poor business admin

Compliance is a boring but necessary part of financial services and, for both public and private companies, maintaining a share register is part of that administration.

But managed the right way, stakeholder registers can deliver far more than meeting legal requirements; they can help you to build more profitable investor relationships.

The legalities of managing investor data

In most countries, financial organisations are required by law to keep a record of shareholder data, so you know who owns your company at any given point in time. A database also makes it easier to contact investors in the event of an Annual Grant Meeting (AGM) or company vote, or arranging dividend payments.

Many companies create a list or register to manage this information, which needs to include investors’ names and addresses, the amount paid on their shares, how many shares they hold and what class, and the date that they became an investor. In some countries there are additional requirements; the length of ownership is a particularly important detail to record in France, Italy and Spain for instance, as loyal investors receive additional rights.

For publicly owned companies there is a further requirement, as it must be declared on record if anyone with voting rights acquires an interest in your shares. To manage these administrative requirements, most public companies turn to a registrar or Central Securities Deposit (CDS) to outsource the job, but this often results in high fees and slow updates, as many such custodians are using legacy technology.

On the other hand, private companies tend to manage investor data in-house via an excel spreadsheet or word document, but this makes it difficult to ensure there is a single accurate copy of the list at all times, and that everybody is updating the same document. Sometimes these spreadsheets aren’t password protected either, leaving them vulnerable to unauthorised changes.

Getting legally-required information into a central list might be the end of the exercise for many businesses, but with this approach you are missing the opportunity to nurture the value of your investor base. By migrating to an online share register, however, you can do so much more with the data you are collecting.

  • Business management
  • Investor data
  • Compliance
  • Big data
  • Investor relations