Choosing an Entity Management Solution: What you Need to Know to Manage and Protect your Subsidiaries
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Managing your subsidiaries doesn't have to be a tedious manual process. Our webinar will discuss how technology can help you streamline your processes. We'll explore the top 10 factors to consider when evaluating an entity management system. You'll see how CSC®'s integrated solution can dynamically transform the management of your entities. We'll help you identify essentials to look for when choosing the right solution for the job.
- The way to evaluate an entity management system to ensure it meets your needs
- Why an entity management system is critical for effective corporate governance and compliance
- How a system can help you organize and maximize your critical entity data and documents
- How an entity management system can automate generating reports, graphical organization charts, and locating documents
- How to integrate seamlessly with CSC's registered agent and transactional services
Anu: Hello, everyone and welcome to today's webinar, "Choosing an Entity Management Solution: What You Need to Know to Manage and Protect Your Subsidiaries." My name is Anu Shah and I will be your moderator. Joining us today are Jennifer Mailander and David Jefferis.
Jen Mailander is an Associate General Counsel and Director of Compliance and Privacy with CSC. Jen is a business and privacy attorney with extensive experience in negotiating commercial contracts, corporate governance, compliance, security and privacy. David is Senior Sales Engineer for Compliance and Governance Services at CSC. With CSC for over ten years, he has significant experience providing training, implementation and consultative services to CSC's entity management clients. With that, let's welcome Jen and David.
David: Great. Thanks, Anu. It's wonderful to be here today. We're both very excited for today's webinar.
Jen: Hello. I'm Jennifer. Thank you, Anu. It's a pleasure to be here with both you and David. So, I'll touch base just quickly on what we're going to discuss today. I'll start by providing a brief overview of CSC in case you're not familiar with our company. David will then jump into an exciting definition of what we mean when we're talking about entity management and why an organization might want to implement an entity management system.
Then we'll look at our top ten considerations for when you might be evaluating an entity management solution. We'll take any questions you may have throughout our presentation. If there's time at the end, David will be providing us with a brief demonstration of CSC entity management.
Okay. So, let's talk a little bit about who we are at CSC. So, we are the business behind business. We are a business, legal and financial services company providing knowledge-based solutions to our clients around the globe. We provide solutions for every phase of the business lifecycle, whether you are forming entities, maintaining compliance for those entities, working on any security transactions, supporting your real estate or M&A or other transactions.
We really effectively manage, promote and secure our clients very valuable brand assets against the threats of the online world and we offer a single tax and risk management platform helping our clients better manage that risk, achieving better automation and providing data transparency and ultimately staying in compliance. We offer a single tax and risk management platform, helping our clients better manage that risk.
We work with more than 180,000 business, including 90% of the Fortune 500. We support more than 10,000 law firms. We provide solutions to more than 3,000 financial institutions and we protect 60% of the 100 best global brands, including 8 of the top 10 and we have more than 2,500 employees in more than 15 countries and we're doing business in all 50 states.
David: Wonderful. So, certainly there are a suite of services that CSC offers, but really our primary focus today will be a discussion around entity management. So, really, to make sure we're all on the same page, we want to spend just a few moments talking about the definition of entity management. What do we mean when we say entity management?
So, I'm advancing the slide. There you go. What you should hopefully see in just a moment is a slide that says Entity Management System Definition. So, critically at its core, any entity management platform is designed to help you track information about your company, starting with basic things like entity names, entity types, the different jurisdictions where these companies are registered, when their annual filings are coming due.
But it quickly evolved beyond that. So, entity management platforms provide the opportunity to track custom information that would be unique to your organization, the ability to manage officer and director information. Now, we say director and officer, but that certainly could also encompass things like members and managers, partners, powers of attorney, authorized signers. There could be any number of capacities that you may need to track within that type of solution.
Entity management platforms also provide the means to track the source, what I'll call the source documents, so articles, bylaws, information documents, agreements, consents, resolutions–the documents that really fundamentally describe the entities that you're managing. The entity management solution that CSC offers and that you'll see perhaps a demonstration of later in our presentation is a very powerful graphical org chart capability, the opportunity to, with a click, see a graphical representation of your ownership structure.
Another capability relevant to publicly traded companies is the ability through entity platforms to electronically submit filings directly with the SEC, referred to collectively as section 16 filings. Last but not least, something that we'll definitely speak to during the course of the presentation is the ability of an entity management platform to really automate the process of creating reports, the ability to, again, get lists of directors, officers, create a summary view of all the information that you're tracking for your company in another example. This really sets apart a solution versus those that are working in a manual environment.
So, to that end, you may recall, folks on the call, that there were a couple of registration questions that we posed when you initially registered for today's session. I did want to share the results of those polls, although we'll do a few more polls in just a moment.
The first poll that we had, the first question was, "Do you or do you not currently have an entity management platform in your organization?" Surprisingly, if we look at the results across the morning session that we did earlier today and session we're doing now, the results were fairly interesting where 60% of our respondents said that they, in fact, do have an entity management platform whereas 40% said they did not, which actually surprised Jen and I slightly because normally in the conversations that we have with prospects, the inverse is normally true where more folks that we speak to do not currently have a platform in place.
So, as we go through the considerations of what you should think through as you explore an entity management solution, we're really attempting to have that conversation from the properties of someone that does not have a platform in place as well as an organization that maybe does, but is potentially dissatisfied with the current solution and might be thinking about transitioning to another vendor solution. These questions would certainly apply to that audience as well.
The other question that we posed in the registration was, "How many entities do you currently manage?" It was an incredibly wide array of responses, from a client that says they manage a single entity to one of the responses that says over a thousand and certainly everything in between. So, hopefully what we'll look to discuss today is relevant to everyone within that spectrum, those that have a handful of companies to those that manage potentially thousands of entities within their organization.
Jen: And those numbers are actually reflective of our customer base as well. We have experience working with very small companies and very large companies.
David: That's a fantastic point. Now, before we go into the audience poll, we did want to talk about why organizations implement entity management solutions. So, one of the main reasons is that tracking information manually, and there are some examples that I hear day in and day out of organizations that track directors and officers in Excel spreadsheets, organizations that manage documents on shared drives, clients that use programs like PowerPoint or Excel or Visio to manually construct org charts is that it is a time-consuming, really thankless endeavor to do things in a manual process. There's no automation.
Collaboration is incredibly difficult and then reporting, which we touch on here, is not really an option. If someone were to come to you say, "I need a break down of directors and officers for a set of companies," without an entity management platform it becomes really daunting and incredibly time-consuming to try to produce that type of information.
The last point is something that I hear quite a bit as well, where, again, there are organizations that do things manually and then over time as they grow through acquisition or just natural growth of the number of companies they manage, things start to break down where I hear things like I used to be able to do this manually, but now it's just getting to the point where I'm struggling and I really recognize that I need a platform to assist me.
So, with that said–again, this was a part of the registration poll–but we wanted to hear this directly from the audience on this particular session. So, the question here is do you have an entity management system today? How do you manage your entities? Is it a vendor provided solution? Have you cooked up some sort of internal home-grown application or are you working in that manual environment that we described a moment ago? So, we'll give you a few moments to respond to the poll and then we'll share our poll results.
All right. So, let's go to the results. There we are. So, "I use a vendor-provided entity platform," so, 40% said that they do have a vendor solution, 8% have a home-grown application, so roughly equating to about 50% of the audience. And then 52% say that they do things in a manual environment. So, it's pretty much a clean split down the line of those that do have a solution and those that don't, which, again, is fairly consistent with what we encounter.
So, we appreciate you responding to that poll, but we do have one more question to ask before we move into the rest of the presentation. Do you have any of the following concerns with implementing an entity management application? And this, again, would be from the perspective of those that do not have a system currently or maybe from the perspective of those that may look to transition to a different a platform.
And this is a multi-select, so you can pick more than one option here. Do you have any concerns around security? Is cost a concern or the concept of getting your information into a system for the first time or transitioning data out of your current platform into another system? Do any of these considerations raise concern for you?
Excellent. So, now we'll move on to the responses. Again, it is a multi-select, so these percentages don't tally to 100 by design. So, a large majority of the audience says that security is a concern. Nearly half the respondents have that concern, which is something that Jen can speak to momentarily.
We see that cost is, and this was actually true in our morning session, that cost was the number one concern by quite a bit. That said, there's also a fair amount of the audience, well over 60% that worry about what it will take to ultimately implement their data and documents into entity management platform, so that transition is a concern, also something that we'll speak to as a part of our presentation.
Jen: And we'll definitely touch on cost towards the end of the presentation.
Jen: So, stay tuned.
David: So, now we're going to look at what we're calling the top ten entity management considerations, things that you should, again, be thinking through, questions you should be asking your vendors as you evaluate an entity management solution and we're going to kick it off with Jen talking about security.
Jen: So, security is near and dear to my heart. As you were evaluating potential providers of entity management systems, without a doubt, the first consideration that you should assess is the system security and the security practice of the company with who you would be working.
I happened to see an email that came across last night from the Association of Corporate Counsel or ACC and they have just released their ACC Global Trends Report based on a survey they did of their global membership. The top finding that they identified in my little email is one in three respondents noticed that their law department will direct resources and mandatory cyber security training for their employees. So, ACC membership obviously agrees that you need to be aware of cyber security and your security practices.
So, David, we heard from you a few minutes ago talking about, as you define what we mean by entity management and the type of data that's likely going to be maintained in an entity management system. So, that's officer and director information, potentially bank account information, all of that essential data that you and your company need to perform and function.
So, you really want to make sure that you're checking with your potential providers where will the data be stored. Is it going to be based on servers that are located in-house for you, so within your own facility or does the provider house the data on their own servers located in a different location? Or is it housed in a third-party systems in the cloud? So, all of that information is critical for you to understand and you very likely have legal obligations to understand that as well depending on the type of data that you're storing.
And then who has access to that data? You want to understand this from the perspective of your own company. We'll talk a little bit more about user access. But you also really want to understand it from the vendor perspective. Who within the vendor could potentially have access to your data?
And then how is the data protected? There are just a series of questions that you want to ask around this to validate the practices the company will take to protect your very valuable information. That includes things like whether or not the data is encrypted. When I talk about encryption, really we're talking about converting electronic data into another format, sometimes for just site protect so that it could not be easily understood if you come across this data and you would actually need a key to unlock the site protect so you can actually understand the data.
And you definitely want to make sure that your vendor has your data encrypted both at rest, meaning when it's sitting in the database, and when it's in transit, moving across where you're accessing something on the internet or you're sending an email. So, those are the two forms of encryption that we deem as essential.
Then what are the vendor security practices? For here, I really recommend that you work with your internal security team. Get the vocabulary from them so that you know the questions you should be asking and the types of reports and assessments that should be done.
Now, with CSC, which our sort of response to this area popped up on the right hand side there, security and protection of your data and documents is our number one priority. We handle our customers' information with the same level of care that we handle our own information with. At the technology level, all data and documents are maintained on CSC servers, networks, and our data storage systems.
Those are all located within a world class ISO 27001 certified and service organization or SOC-controlled audited colocation hosting facility located in Ashburn, Virginia with a secondary facility as a backup located in Springfield, Illinois. Access to the data is tightly controlled and only authorized personnel from a technology perspective have access to that. Then we also perform regularly scheduled vulnerability testing.
At the solution level itself–so, really what we're talking about here are the end users–the system is role and permission-based. So, we allow you to control who as access to your data and documents. You can even control who has access to certain types of data. So, maybe if I want someone to have access to basic entity data, I can then block them from not seeing, if I don't want them to have access to the officer and director information or perhaps the minute book.
So, David, clearly we take security very, very seriously.
David: Absolutely. It is one of the first fundamental questions that you should be asking your vendors when you explore these solutions. So, with that said, the next consideration that we'll talk about is integration. Really in short, the question you should be asking your vendor as you explore a platform is am I looking at a standalone application or am I looking at a platform that offers some means of integration? Am I able to have data flow into this platform? Is this application able to share information as needed securely with other systems? Am I on an island or do I have some ability to have some interconnection is essentially the question here?
So, really, the CSC response is that we have tremendous levels of integration with our entity management platform. Fundamentally and what really sets our solution apart from the majority of the offerings on the market is that CSC entity management is built directly on top of the core data that we maintain as a registered agent.
So, when CSC is representing an organization, we have core vitals for the companies that automatically appear within our record, the names of those entities, their entity types, where they're doing business, dates of authorization, charter IDs, when their annual filings are coming due. That's true not only for US companies but as my colleague, Jen, will speak to on the next slide, CSC also offers global corporate secretarial services as well and we can offer integration with global data. Not to steal your thunder, but that's something that will speak to in a moment as well.
We also have points of integration within our entity management platform with Secretaries of State. So, dynamically we go out on a routine basis to pull in the current status of the companies at the Secretary of State level and to provide notifications via email alerts should the status of one of your companies ever change.
We have intelligent rules built into the solution that would automatically create visibility and notifications around when there are annual filings due, like annual reports that would impact the good planning status of your companies as well. We're not expecting you to know that. We have, again, the smarts built into the system to be able to predict and be able to tell you specifically when those filings are coming due. I say that because there are vendor platforms that lack that type of intelligence.
The last bullet point here on the right hand side about our integration capabilities talks about what's known as an API. That stands for application program interface. Really, this is the opportunity to take information and potentially documents that you're storing within our entity management platform and securely integrate them with another solution in your organization.
It could be that there are certain core entity details or certain core entity documents that you're maintaining in our platform that maybe there should also be a reference to in a tax program or an accounting program. So, the API, in short, is a technology that allows two systems to securely talk to one another. So, you can have data essentially that is in sync between two systems, in this case entity management and a third-party application of your choosing.
Jen: So, on that global perspective, clearly we live in a global economy. So, whether your company already dose business internationally or you hope to grow and expand your business, you really want to make sure that your entity management system can capture global information in a way that's meaningful in those jurisdictions and to the people that need access to that data.
So, we're talking about everything here from entity types to something as basic as address format. If you do business, say, for example, in Luxembourg, Germany and Singapore, does the system have the ability to support the different types of entities? I'm talking more than just an LLC or an incorporation, but an affiliate, a limited company, a GMBA or even the ability to capture custom entity types. Plus you want the flexibility to control, again, who had access to that data.
So, does the business manager for the Asia-Pac region see only data related to that particular region for business in her region? Or does the manager for Europe see only European-related entity data? Then you've got someone with the role of the corporate secretary who probably wants to see entities for all related entities.
So, from the CSC perspective, CSC Entity Management is designed to allow you to track and manage not only your US entities, but all of your international subsidiaries. There is an administrative role and you can have as many administrators as you need with the ability to control what user has access to what entities, whether it's by country, by region, by entity type so it can get very, very detailed and specific to meet your needs.
Plus the administrator can then control user edit rights. So, you may have a group of users who have viewing access only because perhaps they're business users and they just need to see your entity named and then have no editing rights. So, they can't impact or change the data.
For many of our customers, they actually outsource their corporate secretarial function to CSC. We refer to that as our global subsidiary management service and we offer this service, actually, throughout the world around about 120 different jurisdictions. Of course, we use CSC entity management to manage that data.
David: Just to add on to what my colleague Jen mentioned, there are certainly organizations that I've worked with over the years that will set up users that only see entities in certain regions or countries based on their responsibilities.
Also, though, I can recall working with a Fortune 500 that had different administrative users in different parts of the world. So, they specifically had a couple of administers in Europe and the way we setup their access was such that they could view every single company in the platform, which were hundreds of companies, but from an edit perspective, they only had the authority to edit information around the Europe portfolio. So, there's, again, tremendous granularity to make sure that people can sort of only see and update the types of information the admins are comfortable with.
Jen: So, in terms of automation, which is our next consideration, this is really about the importance of automation and workflow. So, you want to look for a system that allows you to automate or streamline your work processes so that then you and your employees can focus on the more high-level, high-value work and you're not spending your time working on administrative tasks.
The two criteria that I think are the most critical for an entity management system really relate to searching and reporting. Searching gives you that ability to quickly get to that key data. Perhaps you want to see the entities that a particular director sits on. So, you've got the ability to quickly search and find that information.
David, you touched earlier on reporting. It's essential to get to that high level data that you need because we are overwhelmed with information in our world today. So, reporting and actually searching as well give you that ability to sort of hone down and get to the data that you need to see immediately.
So, let's start talking quickly related to CSC, CSC Entity Management's searching capabilities. We include a powerful search feature that allows you to search across any entity data within your platform. This includes like entity-related data or document attributes such as entity name, jurisdiction, entity status, officer, director, member names, titles, etc. Plus, there's a full text searching capability that lets you search for documents containing a specific word or phrase so you can easily locate documents with specific references to your activities, again, officer names or other details within the text.
That's critical. If you think of some of those companies with lots and lots of entities or subsidiaries, that means they've got lots and lots of minute books. I remember the days when I was an assistant secretary and I kept minute books in a filing cabinet and on top of the filing cabinet. So, just the ability to quickly get the data instead of going through volume after volume is essential.
David: Absolutely. Reporting is one that I would add in there too. So, this is an area where, again, as you evaluate a solution, this is where you might to not challenge your vendor, but really have them prove to you that the platform that you're exploring can meet your reporting requirements. There's certainly a lot of feedback that I've heard from prospects over the years that have worked in other vendors' platforms that everything seems fine and they're capturing their data and then when they go to run a report, they're either not able to get the information they're looking for or it's incredibly confusing and daunting to try to figure out how to actually generate a report.
So, this is where you want flexibility in terms of getting the data in the format you want to see it, but also simplicity in terms of the user interface. What steps do I take to run a report to give me the information that I'm looking for? So, I definitely would encourage, again, all the folks on the call to make sure that the system they explore meets their needs from a reporting standpoint.
The next thing that we'll talk about is collaboration. So, for the about 50% of you on the line that do not have an entity management platform in place, I can only imagine that collaboration is very challenging. Again, if you've got information on a spreadsheet, documents on a shared drive, charts that are being put together manually, it's probably difficult to permission people into and share that information across your organization.
So, the benefits of an entity management solution really is the opportunity to have that information not be solely locked into the confines of the legal department, where not that you'd want to, but you become a bit of a bottleneck where people have to keep coming to you for this type of information. Now you can really securely share that information across other parts of your organization, whether that's tax, finance, HR–again, the entire organization has the opportunity now to have visibility to your entity information.
Now, you certainly, as we mentioned before, have control over what parts of that data users would have access to. With the CSC entity management application specifically, we do not charge for users. There are many vendors that do charge for what they refer to as seat licenses, where you're paying for blocks of users. So, you might get one or two edit users and maybe seven or eight what they call browse users, people that can only view information.
Then unfortunately, if you want to extend beyond that, you're paying additional fees to have more users in the platform. I've even worked with clients that have intentionally limited their rollout of the platform across their organization because of concerns over the cost that they start to incur as they have more users within the solution. Thankfully, there's predictability here with our application where there is no fee for users and that doesn't impact the annual fee in any way.
The last bullet point which, as time allows, we might try to take a look at as a part of our demonstration, is the idea that you can also control what sections or parts of the platform a user would have edit rights to. So, for example, you could permission a colleague of yours from the tax organization into the tool and then only give them the authority to edit tax information.
Maybe there's someone in finance, accounting, that should have the ability to edit fields related to financial information. Our platform gives you that granular level of control to give edit rights to just the parts of the data that make sense to allow folks maybe outside of the legal department to be able to modify them.
Jen: Okay. So, now let's talk about expertise and support. So, when you are evaluating systems again, make sure you understand what type of support the vendor provides. So, this includes support from the initial transition through the remainder of your agreement with that company. Make sure you understand what the costs are because there are many companies out there who actually end up making more money on the ongoing support component than the purchase of the actual underlying system.
Ask them to identify who the team is that'll be supporting you and understand how it is they will be supporting you. I think it's perfectly fine to ask for references. Find out what the process is that someone else in a similar situation went through to get onto this new system and ask them like what would you do differently, what lessons did you learn, what was the best experience, what was the worst part of the experience?
In my mind, service is either part of a company's culture or it's not. So, obviously in the world of CSC, if you could go to the next little thing there, service is critical to who we are. It's actually very much part of our culture. We are a service company. We maintain a toll-free phone number with a dedicated support staff as well as a dedicated email inbox so that you've got the ability to communicate in your style that meets your needs and you can obviously call or email. You can communicate in the way that you want.
The average tenure of our customer service team is more than 10 years. So, our team members truly are the experts in our systems and the requirements that have brought about your need to have us do filing for you and maintain those filings. And of course, we never offer legal advice, but we know our business very well. All training we provide is complementary and web-based, making accessible for users anywhere in the world. We've got an experienced team that works with our customers, especially as it relates to data and document migration and those projects.
That leads right into the next consideration, which is implementation. So, this slide is very much about understanding how it all happens. How do you get a new system implemented? Whether you're coming from an Excel spreadsheet and shared drives or using another system, you really, really want to understand what goes on when it's time to implement because what we're really talking about here is change.
Change is the norm for all of us, but it's never easy. So, you want an experienced team that can help you walk through the process, things like a project plan to understand the components about what is happening. Are you going to be responsible for the entry of all the data that your company, if it's over a certain number of years old, you probably have a lot of data? By the way, how long is that going to take?
If you're currently using another system, you want to make sure that you allow time between the two systems to coexist so that you know there's a smooth transition and that you have access to your critical data and documents should you need it. With any implementation, you've got responsibility yourself. So, don't assume that you're going to turn everything over to a third-party because you should be there in case there are questions that arise and then you should get regularly scheduled updates.
So, for CSC, if you ask me, in terms of one of our top three differentiators, David, it's what you discussed earlier. It's in our role as either registered agent or corporate secretary, it's our ability to then automatically integrate your entity data, your documents into the system as we file transactions for you. So, that differentiates us from any other competitor in the market, as far as I'm concerned.
We can absolutely assist with the transition. I think David, we talked about this before. We have an incredible team that is experienced in data conversions and goes through this process with many different competitors, right?
David: Right. Just to speak to that, certainly, we have years of experience transitioning clients from third-party vendor solutions as well as manual environments, where clients have, again, spreadsheets and information and don't have the time or resources to devote to doing that data entry up front.
So, as a part of that process, we definitely engage the customer to understand how they want to see their data and documents represented in our solution instead of just entering everything and hoping it meets the needs of the client, it's more of a consultative approach, where we'll enter information for a handful of companies, sit down, review it with the customer, make sure that it does meet their needs and if any changes are required, we are at that point in a position to do that.
Then once we have the green light, we can move forward with the remainder of the project. We also do a thorough audit to ensure that the information in our platform matches the information that was provided by the customer, but this really is where that engagement is critical. Jen, you mentioned that from the properties that the customer can't just sort of turn things over, there is some level of clarification that typically we may need to seek out from a customer. So, a client that is actively engaged in the implementation, those are the most successful ones that we have.
David: So, the next slide talks about customization. So, the question here, because no two organizations are identical–ultimately, entities are entities and directors/officers are directors/officers, but that kind of goes out the window pretty quickly, right? So, when you're in healthcare or you're in real estate, there are parts of your business that are certainly different, that are unique. So, you're hopefully looking for a solution that gives you that flexibility to track information that is unique to your organization.
Then the second question really becomes if we are able to uniquely configure the platform, is that a standard view that every single user sees or are we able to do customization that is user-specific? Can different individuals get different looks and feels within the solution itself? That's another kind of critical question to pose to your vendors.
Now, in terms of how CSC matches that requirement, we would state that CSC is a highly configurable application. So, the term customization, if I can get into semantics just for a moment, the term customization when you're talking about applications and software really implies that the vendor is going to have to do some software development and some coding that could take weeks or months or beyond.
Whereas the term configuration or configurability implies that as the customer, you're able to make updates to modify the look and feel that really do not require any sort of involvement from the vendor or any lag time in terms of development from the vendor. So, again, we would state the case that our application is highly configurable.
In one example, administrative users can establish an unlimited number of custom fields. They also can establish custom sections on what we call the entity summary page, which is the very first screen that you see when you select a company within our platform. And then individual users have the ability to add, hide and rearrange the order of columns on every grid in our application, effectively every screen in the application and that is unique to their login.
So, for example, Jen, if you and I were working together within our entity management platform, on the main screen of companies, you may prefer to see 20 columns of information, the vast amount of information at your fingertips, whereas I may prefer to have a more streamline interface where maybe I see five or six pieces of basic information.
And in that example, you and I are not competing or conflicting with each other. The data in the platform is ultimately universal, but in terms of what you and I prefer to see, that could be vastly different. Again, it's configurable down to the individual user level.
Jen: And both levels of configuration you just described I can do. So, you do not need an IT degree to make this system work.
David: Absolutely. That's a fantastic point. Certainly, we have a robust service organization, as Jen spoke to, and we're more than happy to assist with helping you create fields and modify screens. But really these are all things that you can do really at your fingertips that are very intuitive and user friendly.
So, the next consideration, as we get towards the end of our top ten here, is the roadmap. So, before you dive in with any software solution, any platform, you want to make sure that the platform is secure, it's stable, it's something that the vendor is committed to and that there is a future for the applications. So, some questions would include, what are some of the recent upgrades that you performed within your solution? What do you have on your roadmap? What's on the horizon as far as upgrades are concerned?
I can say based on direct feedback that I've received from prospects that I've spoken with that there are a few entity management platforms in the market that are rather static, where if you look at the capabilities today, they're no different than they were two or three or four years ago, which begs the question is this platform evolving at any point into the future? So, again, as our needs evolve, as technology evolves, we want to make sure that the platform is doing that with us as well.
So, with that said, I want to spend a little bit of time before we get into our live demonstration of talking about the CSC Entity Management roadmap. I think you'll see that on your screen in just a moment.
So, first what I'll do is talk about some of the more recent enhancements we've launched within our platform. The first that I'll talk about is auto-indexing. In plain English, that means that when you upload documents into CSC Entity Management, those documents immediately become searchable. The text of those documents can be searched again. So, you could launch a search across all of your documents if that were to make sense and say, "When was this officer elected? When was that capital issued? When was that merger performed?" Any information in those documents instantly becomes searchable in the solution.
So, Jen, you mentioned that is sort of the modern age that we're in, no longer having to flip through binders and wonder where the documents are located, we can instantly find where those matches occur in a matter of moments in the solution.
Another notable upgrade that we've performed recently is what we're calling officer/director custom roles. So, in this context, a role is really synonymous with a capacity, officers being a capacity, directors being a capacity. The system does come pre-loaded with some standard choices for capacities, like officers, directors, members, managers, partners, powers of attorney, and committee members.
That said, I certainly have worked with folks that have capacities beyond the ones that I just mentioned. They might have authorized signers, supervisory board members. They made need to track things like trustees and beneficiaries. So, you're not stuck with the standard capacities in the platform, you're able to augment them in any way that you see fit. You also can establish an unlimited number of custom titles in the application as well as track any type so responsibilities or appointments within your organization. All of that flows directly into our reporting engine.
The last one that I'll mention in terms of recent upgrades is our integrated Section 16 filer. So, for those on the call that are working with publicly traded companies, this is something that you are, I'm sure, familiar with and maybe even responsible for, needing to perform filings with the SEC forms 3, 4 and 5 specifically when there are individuals often called insiders that are receiving or are moving shares of the organization. So, there's an integrated capability within our platform to interface directly with the SEC to submit those filings in real time.
Now the stuff that I get really excited about are the enhancements that are in the pipeline. A couple of these, the first two, are upgrades that I would call eminent. I think we'll see these in the next month or two within our entity management solution. So, additional org chart customization–today in our org chart platform, which we'll actually show you in the demo in just a moment, you do have the ability to control quite a bit of the graphic org chart.
You can decide what fields of information you want to see included in the boxes along with the names of your companies. You can even modify shapes and colors, "I want LLCs to look different than for profits. I want global companies to look different than US companies." There's any number of ways to create that visual differentiation.
That said, we've got some pretty consistent feedback from tax organizations that want to see a few more tax-friendly shapes that have a meaning in the tax world that would instantly become recognizable to a tax user that, "Okay, that's a disregarded entity or an S-corp, for example." So, there are more shapes on the way.
The big upgrade that will occur probably in a month and a half, two months' timeframe is what we're calling folder-level security. Now, to be clear, within the CSC Entity Management application as an administrative user, you do have a great degree of control to make sure that only the right people should be seeing documents. So, you can have an entire class of users that when they log in are not able to get to your minute books by design.
That said, today, if I were to permission a user into a minute book, it ultimately means they can see every document in the minute book, not just documents like articles and bylaws and state documents like qualifications and withdraws, which are pretty harmless documents but they also can see what can be more sensitive documents like a consent or a resolution of a board meeting.
So, for that reason, we're about to launch what's called folder-level security, where down to the folder level, you're able to determine what documents someone should or shouldn't see. So, in that example that I just shared, you can establish a user that is able to see some of the more harmless folders, as I'm describing them, like articles and bylaws, but at the same time, disable their ability to even view the minutes folder and the associated documents in that particular area, really getting down to the document level in terms of what someone can or can't see within the solution.
The org chart key reports is also, I think, a pretty exciting upgrade, where one of the challenges that a lot of organizations face that have larger org charts that in some cases could have dozens, hundreds or thousands of entities is how in the world do we print this thing? So, again, it can be quite challenging.
So, the org chart will allow you to download data in such a way that if you then have a third-party program like Visio or OrgPlus, you can actually import that information into one of those org chart programs and have complete control over which entities are represented on which pages. So, it's going to put a much greater degree of control in the hands of the customer to really create large org charts that can then be printed legibly as you get to kind of break them out in a way that you see fit.
My Entity Workspace represents really a suite of development that we'll be working on. To put it succinctly, one of the more notable parts of that work will be the ability to have a different look and feel for different types of companies. So, for example, if I click on a US LLC, there might be a certain series of fields that I feel are relevant to have visibility to, whereas if I'm clicking on maybe a GMBH in Germany, I may feel that there is a completely different series of fields that are relevant to see.
Now, our application does currently facilitate that type of ability, but to be forthright, it could be more seamless. That's really the whole point of this upgrade is to make it much more dynamic, much more user friendly, to have those different looks and feels for different types of companies. So, that's the main thing that I would reference from that particular upgrade.
The next thing, and it's our final consideration before we dive into the demo, is cost, which was mentioned as one of the top–I think it was the top concern of our audience–what is this going to cost me?
Jen: And how did we know? We are psychic because we knew that this would be a key question, as it should be because we understand that it's a critical factor. So, questions you want to ask is what is the fee structure? Is it based on the number of users, those seat licenses? Is it based on document storage? Is it based on the number of entities or potentially some combination of all of those?
What's included in that fee? Does that include the data conversion or document conversion from your existing system or lack of system to the new system? Are upgrades included? So, if new enhancements are released, do those get included or is there a charge for that?
From a CSC perspective, if I talk about our role as registered agent, we look at our pricing structures based on the number of entities that you manage. It's an annual subscription. So, we work with you and recognize that sometimes you add entities, sometimes you take away entities and we can work obviously with folks about fixed terms so that our goal isn't to increase your price every year. So, we can make this totally transparent and that's sort of our culture and how we believe in supporting you.
I would add that there are no fees for users, so David pointed out earlier you can have an unlimited number of users and that includes adding your outside counsel if you want to integrate them because you're working on an M&A activity or some other project. We have unlimited document storage and some systems out there do not. We know they charge for based upon the number of documents you have. And of course, it includes any upgrades that we release automatically and roll out to you seamlessly.
From the GSM or global subsidiary management perspective, it's priced a little bit differently. We start with a corporate health check and compare your existing subsidiary or entity as it looks now and then talk with you about what services need to be provided to either maintain that compliance or bring it up to compliance, but we also look to have a flat rate fee and try again to make all the pricing transparent.
There's another component to the global subsidiary management piece that relates to ongoing compliance, so making sure that your international filings–this is basically you outsourcing your corporate secretarial service internationally to us and we make sure that you stay in compliance with filings and helping you maintain your direct roles, etc.
We also a got a question about annual reports. So, we do also offer a service if you wanted to outsource your annual reports.
David: Absolutely. I did want to make another comment about the second bullet point under the cost of CSC that talks about an annual subscription being based on the number of entities. Just to be as clear as possible, there is not a strict per entity fee. Really, what we do is we create a range of entities. So, 1 to 50 entities is our first tier of pricing, 51 to 100 is our second tier, 101 to 300 is the third tier and it goes from there, the idea being that most organizations comfortably fit within one of those tiers.
What I'll also mention is if you were to grow from one tier to another, let's say you start out with 45 companies, which puts you in the introductory tier and then maybe a year later you have 55 companies, which technically does put you into tier number two, from our vantage point, that does not result in an automatic rate increase. I can say from direct feedback that are received from some of our prospects that there are other vendors that would instantly bump up your price based on the fact that you're in a new tier, which, again, it's somewhat arbitrary. Is 55 entities really that different than 45 entities?
Now, what we would say is if you grow tremendously where you quadruple your entities in a short span of time, we probably would need to sit down and figure out what is a fair annual rate, but natural growth over time is a wonderful thing and theoretically we're representing you in more jurisdictions as you're aging or globally as a corporate secretarial partner, so it's not an instant need for us to increase the annual fee. So, I wanted to make that clear to our audience since cost was certainly a concern.
Anu: We have run out of time. If we didn't get to your question, we will contact you with a response after the webinar. Thank you to everyone who joined us. We hope to see you next time.