NEW TOOLS FOR IMPROVED ENTITY MANAGEMENT: THE LATEST SERIES OF FEATURE ENHANCEMENTS

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Annie: Hello, everyone, and welcome to today's webinar "New Tools For Improved Entity Management." My name is Annie Triboletti, and I will be your moderator. Joining us today are David Jefferis and Andrea Jonaitis. David is a Senior Sales Engineer for Compliance and Governance Services at CSC in the Wilmington, Delaware headquarters. With CSC for over 12 years, he has significant experience providing training, implementation, and consultative services to clients at CSC Entity Management and consults with those evaluating CSC matter management solutions. Andrea is a Sales Engineer in the Corporate And Legal Solutions Group at CSC. Since joining CSC in 2017, Andrea has specialized in global subsidiary management and entity management, working with prospects to present an accurate and clear scope of services, including helping subsidiaries stay in compliance, as well as demonstrating CSC Entity Management. And with that, let's welcome David and Andrea.

Andrea: Hey, everyone.

David: Hey. Thank you so much for joining. Annie, thank you for hosting us today. We're both very excited to really run through some exciting functionality in our platform, but we have so much to cover before we get there. So we'll start really with the agenda. So really what we want to do at the very outset here is to make sure that we're all effectively on the same page when we're using different terminologies. So, you know, what do we mean when we're talking about entity management?

We'll then sort of segue into looking at some of the advantages to having an entity management software solution and perhaps consider if you're evaluating implementing the system for the first time, or maybe transitioning from one platform to another. And then certainly, we want to define the services that CSC offers in this area, and then take a look at a number of enhancements to the entity management platform, including a demonstration of a very recently launched customization upgrade in the platform.

And then we will make sure at the tail end that we have some time for Q&A. And certainly, there is a Q&A widget that you can use during the webinar to ask questions and we will potentially as best as possible, we're pretty agile, maybe try to answer some of those questions as we go, but typically, we try to get to those, you know, towards the end of the presentation. So that's what we intend on covering. And again, we're really excited and we thank everyone for joining us today.

So again, what is entity management? At its core, entity management is a practice and it's really a discipline all about keeping your company in compliance, which could be at a state level, a federal level, county local. It can become very complicated very quickly depending on the scope of your organization. Entity management, again, is a practice that involves managing information about your subsidiaries, documents, being able to report upon that information. And really fundamentally, if you take a look at the last bullet point here, entity management really comes down to the ability to provide the right information to the right people at the right time. Having that transparency, having information at your fingertips in a very accessible fashion. So that's effectively what we're talking about when we say entity management. And certainly, entity management is also it's software, it's technology, and so we'll see that come through during the presentation, as well.

I suspect that a lot of the folks that we have in our audience this morning are really entity management practitioners, so I'm not sure that we have to convince them why it matters. But we're, again, just sort of sharing that this is really important stuff. So scrutiny certainly is increasing around regulatory compliance. And, you know, in the States, if you have entities that fall out of compliance, certainly there are financial implications that could negatively impact a deal perhaps that you're looking to launch, maybe, you know, a merger, dissolution, things of that nature, or selling off entities, so that can create some complexities. It can do reputational damage to your organization if events need to fall outside of compliance.

And then when we talk about international entities, which my colleague Andrea will speak to during the course of the demo, really the importance is magnified even further where there can be some criminal implications for entities that are, you know, not in compliance. So this is serious, important stuff. So that's why, again, entity management is rather important. Speaking of my colleague, Andrea, I think right now what we're going to do is talk about the fact that entity management is not a static thing, but it's sort of an ever-changing activity for your organization. So with that, Andrea, I'll have you take it from here.

Andrea: Thanks, David. That's so true because entity management and the process of managing an entity's life cycle is all about constant fluidity. It can be incredibly complicated and involved. And the complexity of managing your entities only continues to grow with the regulatory complexities and the changes that David was just discussing. There are so many aspects to entity lifecycle management and with that the many nuances that come with each step along the way.

The needs of your portfolio as it pertains to your entity management system will also likely evolve over time as your business grows, and you get further and further into these life entity life cycles, whether you're forming or acquiring new entities, establishing the proper licenses, maintaining your good standing, managing changes to officers or directors, perhaps expanding through business acquisitions or developing into new markets, withdrawing or dissolving lots of changes that can occur throughout an entity's lifecycle. And it goes without saying that it's imperative for you to select a partner and an entity management solution that can dynamically support your business and grow with these ever-changing needs.

And what about international entities? Your needs for a superior entity management solution extends not just across your U.S. portfolio, but also into your global portfolio. The corporate secretarial requirements for entities outside of the United States are very different from what we're used to with the management of arms U.S.-based entities. Maintaining a positive standing globally really isn't as straightforward as simply appointing a registered agent or filing your reports throughout the year. There are so many differences based on jurisdictional rules or entity types that really must be considered and addressed. And again, a good entity management system will be able to provide you with a robust centralized repository of data and information that makes managing all of these different requirements, and the data and documents associated with meeting those requirements easier for you to manage.

Some countries can dictate rules about the location where your minute books are stored. Some have registered office requirements or laws that govern who may serve in a local directorship role or other legal representative positions. Global jurisdictions impose a much higher level of know your customer or KYC due diligence requirements, and a variety of other constraints that, again, we typically don't see governing U.S.-based entities. And as David said, missing just one filing or one requirement for a global entity can have a much greater and more serious legal consequence for your business. Not to mention much higher financial penalties than those that we currently see for entities here in the U.S.

So some advantages for having an entity management software. Centralization is critical. So often, David and I speak with prospective clients who are looking for an entity management solution, and they share with us their organization struggles with a lack of centralization of your data, of your documents and records. Being able to have this information spread across multiple databases or shared drives really reduces the efficiency of your organization. Centralization in one repository can provide you with one single source of truth that's accessible by all of your teams all around the world. Not only does it provide efficiencies to your workflows, it also instills confidence in your team that everyone is working from the most current document versions and has access to the correct data and documents as soon as they're needed.

Automation is also a huge advantage when implementing entity management software. Automation ties in with the increased productivity and efficiencies that I just mentioned, but can also extend to many other aspects of your portfolio management. It can include things like the automated flow of documents or data into the software for your immediate access in real time. It could include automated calendaring or tracking mechanisms to track or manage your annual filings or other compliance with good standing events so that you're not responsible for memorizing or remembering those critical dates and deadlines on your own.

You could proactively monitor your entity registrations and current standing in each jurisdiction and even receive alerts of changes at the state level. You can seamlessly gain full text searchability within all of your documents and files through an automatic optical character recognition technology to dramatically optimize your search procedures, or to reduce the time spent searching for your critical documents. You could even automatically build dynamic graphic or text-based org charts in a comprehensive fashion from the right kind of entity management solution. And these are actually just a few of the many examples of automation that CSC brings to the table with our very own CSC's Entity Management Solution.

And, of course, advantages with entity management technology is the collaborative angle. Comprehensive entity management is an interdepartmental discipline, and it extends really beyond the legal department. There's many groups within your company that needs to have access to the centralized repository of data and documents that you're managing. You have groups like your tax group, accounting, finance, maybe even some groups or partnerships outside of your organization. So a great entity management solution can provide you with that global access and can help you to apply role-based provisions to ensure the appropriate levels of data or document sharing in a truly collaborative environment.

And then lastly, here we have reporting. Not only is it important to have your repository of data and documents inside your database, you need to be able to extract the data and information from your system in a way that is functional and easily digestible and beneficial to your business. Your reports should be available in real time, they should be incredibly robust, and you should also have access to a variety of different formats so that your reporting from your system can meet all of your analytical needs.

David: What we'd like to do now is kind to segue into some of the considerations for selecting an entity management software solution. And we're really looking at this from the lens of, again, perhaps an organization that does not have technology, does not have a software platform, but also those that perhaps do, but maybe aren't in love with the platform that they're currently using. And these are some things perhaps to have in mind as you embark on an evaluation of implementing an entity management solution.

So really, what we're going to do is talk about security, integration, and regular enhancements. And to set sort of the stage here, when we talk about integration, you'll see a few things that will come to the forefront. But it's becoming rather common that entity software platforms have integration with a registered agent, so sort of keep that in mind as we start to go through some of these slides. But we will start with security. This is really critical.

So if you are in fact, implementing an entity management platform that has some sort of connection with a registered agent, what do you know about that registered agent? And so a lot of times when Andrea and I are talking to prospects, in some cases, the folks that are evaluating our entity software, kind of wear multiple hats, are, you know, responsible for the entity compliance and then also play a role in sort of the process and litigation, but sometimes that function is split out, you know, into different parts of the legal department.

But don't forget, the critical nature of service of process that the registered agent is responsible for. You know, one missed service of process document can lead to a default judgment, which could be, you know, catastrophic for an organization. So really how confident, how comfortable are you with the registered agent in terms of their abilities, and really their security? What are they doing to keep your information safe and secure?

And then certainly, we want to extend that mindset into understanding how secure is the actual technology platform as well. So there's a lot of sort of detailed items here. We're talking about ISO and SOC 2 Type II deals. And some of this might be a little bit of a foreign language to some folks that really focus on, you know, compliance and governance that aren't, you know, working in information security. But these are critical things to really sort of check, evaluate, and understand. And again, I'm imagining that a lot of folks on the call are familiar with partnering, you know, with their colleagues in IT or information security, to again, put a vendor through the rigors to make sure that they are investing heavily in keeping information safe and secure.

I just the other day saw a recent study, I think it was from IBM, where the average cost of a data breach, which we're seeing these sort of every day now, is over $8 million in the United States. So this is, again, something that is just sort of part and parcel to where we are, and so it's something that you need to really think about what would happen, what could be the damage to an organization if information, you know, got into the wrong hands? And so we feel the security is an absolute paramount consideration when you're evaluating an agent, certainly evaluating entity management software.

As it relates specifically to the security around the entity management platform, we have a couple of bullet points, which are things to sort of think about, things to really explore and evaluate. So role-based permissions, this concept is really a requirement to make sure that you can set up different levels of access for different types of users. So, again, not only would you want to have someone that has administrative authority to make changes, like the modifying slates of directors and officers and uploading documents and modifying ownership records. But likely, you would have a desire to create users that are more limited in terms of what they're able to do, folks that can perhaps just view information and then also certainly the ability to hide information as well. You know, let this person see basic entity data, or maybe don't let them see some of the more sensitive documents like consents and resolutions perhaps that you would upload into this type of a platform.

Also, as Andrea noted, sometimes there's a need not only to be able to surface information to other parts of your organization, like tax and finance, etc., but a need to maybe permission in, you know, outside investors or outside counsel or third-party trusted organizations. And so you want to make sure that you have an ability to do that in a very controlled, secure fashion.

And then a couple of things that, you know, kind of look for in the technology. You know, can I secure documents? Which is often down to a folder level. So that's what the reference there is to folder-level security. And then audit trail capabilities. If we do empower, you know, a subset of our users to make changes within the platform, organizations often require the transparency to know when did a change occur? Who made that change? What's the before/after information? And you would really want to make sure that that information is very easy to get to, either via a search or via a report that can, again, surface that information. Very, very easy to give you that oversight and control over, again, all of your information within these types of platforms. So again, it really does start with security.

So integration, really a couple of questions to sort of frame this part, pardon me, of the conversation. So and if you look at number one, is this entity management software a standalone platforms? This is becoming less and less common. But these things still do exist. There still are providers that offer what we would really think of as a standalone database where effectively, as the customer, it's on you, it's really your responsibility to upload every single piece of information, every single document. And so as you're doing formations and withdrawals and qualifications and name changes, etc., again, the burden is on you to make sure that you're trying, that you're as best as possible keeping that information current. And it becomes cumbersome and challenging for organizations to do that.

So, again, what's becoming a bit more common is that these software platforms do in fact, integrate with a registered agent. And so if that's the case, again, getting back to that earlier thought around security, what do I really know about this registered agent? And so you want to kind of peel that onion back to make sure that you have a confidence level and a comfort level with what they're bringing to the table.

Also, in terms of connectivity or integration, can the entity management software effectively communicate and connect to Secretary of State offices? And I think Andrea alluded to this before in terms of getting not just an insight into when annual filings are due, but what is our current status, for example, at the Secretary of State? Have we lapsed in our compliance? Is something revoked or dormant? You know, what actions may we have on our plates to bring things back in a compliant? So critically, our powerful entity management solution can give you that insight and transparency and visibility.

And then, beyond just the Secretary of State, what other platforms potentially could an entity management software share information within a secure fashion? And so there's a technology that folks perhaps have heard of it's called an API, which stands for application program interface, which in short, is a technology that lets different systems talk to one another. And so quite often, when we're meeting with prospects when we're talking with our existing CSC customers, we hear this sort of refrain that they want their entity management platform to be a source of truth, or the source of truth, for their legal entity information. But it's also quite common that they have a need to share information from the system with other internal platforms.

So, for example, if we have a tax application, and one of the data points in that tax application is a legal entity name. Why am I duplicating my efforts to plug in or type in that legal entity name? Why couldn't my tax platform, again, connect effectively to my entity management software, and have that legal entity name, just as one simple example, fed dynamically into the tax platform so there's synchronicity of the information and again, the entity platform becomes that sole source of truth for legal information? So certainly, some considerations to make sure that you're not, again, getting locked into a platform that's an island, but really quite the opposite a platform that has the ability to effectively interconnect with other platforms and applications.

And so another consideration that we're highlighting here is the role of enhancements. What was good enough five years ago is not good enough today, and I'm sure that'll be true five years from now. So what commitment really does the software vendor has to the platform? So they should be able to really point to functionality that they've launched within their platform, let's say, in the last, you know, year to two years, and also they should be able to communicate a bit of a roadmap in terms of what's on the horizon in terms of functionality.

And so this, again, talks about things that run the gamut. We see some software vendors that invest heavily, and others that are content with sort of let things get a little bit static and stale. And again, the users are losing out in that scenario. So try to get an understanding of what's the normal cadence in terms of upgrades. And then also critically, do we get these upgrades automatically, or does that change things, you know, from a pricing perspective?

And then certainly, there's a little bit of a plug here. We'll do a little bit more at the end of the presentation, talk about kind of what we bring to the table. That's a big focal point. But we're really proud of the investments that we continue to make in our entity management software.

So with that, I think what we're going to do now is transition into defining some of the services that CSC offers. And Andrea is going to take us through this, but I'll just sort of mention now that we really see effective entity management as a combination of services and technology. And I think you'll see that come to the forefront with Andrea's remarks as we kind of go through this.

Andrea: That's absolutely true. CSC is a leading provider for registered agent services. We will offer same-day image-enhanced scanning and electronic delivery of SOP documents with tracking for proof of delivery. And through our integrations with the CSCNavigator platform, and the Registered Agent Services, our unified legal . . . I'm sorry, CSCNavigator is our unified legal and compliance portfolio management system. But through our integration, there's an automatic population and entity data and the documents into, again, this repository of documents and information. And these data elements and documents are stored perpetually. They remain available to you and to your team indefinitely for your historic records or your points of time analyses.

And we touched on the compliance calendar, and we did have a question come in from Kim regarding compliance calendars for international entities. And I'll speak to that in the next slide here. But with CSC's solution, the compliance calendar tracking tool for your U.S. business is automatically populated for you based on your entity data and your jurisdictional registration. So this helps you to calendar and track your annual report, your income tax and franchise tax, your other compliance dates and deadlines. And you can use that tracker tool to organize these requirements, and to communicate transparency and status updates across your team so that everybody's using this one standardized, easy tool to understand where you are in the completion of those obligations.

And David kind of talked about some dynamics status updates with the state level. We've been a leader in this market and growing our business since 1899. So for over a century, we've built and maintained state-level relationships. And we've leveraged those relationships to connect our technology tools to the Secretary of State database in each of the jurisdictions. So clients are able to dynamically see their status of their entities and qualifications, and they can see their jurisdictional standing in our interface and in the centralized database. And they can also rest assured knowing that CSC as their registered agent is also monitoring those statuses and will proactively notify them of any state-level changes that they need to be aware of.

And then in addition to the many forms of interpersonal support that we can offer clients, such as our free and unlimited training, our dedicated account managers, live chats, and comprehensive technical support, CSC also assembled a database of other resources like the forums and tools database, and these resources can help to allow you to be successful in managing other components of your corporate portfolios, like easily having access to state-level databases, or accessing CSC or state or international forms or UCC filing forms, perhaps. It can assist with other procedures you may have, such as how to withdraw, how to dissolve entities, what do I need to do in order to form or qualify in certain areas? And this complimentary database of resources and support is available to all of the CSC's registered agent clients.

So let's get to Kim's question about having that good standing calendar for your global entities. We do provide support for global entities. Regarding the good standing calendar, that's dedicated most specifically to the U.S. domestic business that you have. However, we do offer an integration with the calendaring of your compliance dates and deadlines for your global activities through the global subsidiary management services that we offer. So CSC provides flexibility and support to companies in over 140 jurisdictions worldwide.

With our global subsidiary management services, we'll take a proactive approach to managing all of your compliance obligations around the world, whether it be attention to your annual general meeting, or quarterly, if you're in those jurisdictions required for quarterly meeting, whether it's the maintenance of your minute books and your shareholder registers, the dual language preparation and filing of your documents and resolutions, the automated calendaring of your jurisdiction requirements, CSC is going to identify those dates and deadlines, and then we automate that process for you as an inclusion of the Global Subsidiary Management services.

If you choose to utilize this very strong and powerful entity management tool on your own without the Global Subsidiary Management services, you still have access to the way that Kim is managing her global entities, which is to place those global dates and deadlines on your custom calendar, but you'll see it on automation in the calendaring of those compliance events through the Global Subsidiary Management services.

So, again, you see that centralization with your corporate portfolio with those global entities. And then rather than having to juggle multiple projects with multiple countries in different time zones, experiencing language barriers, or currency exchange rate, you get the benefit of working with knowledgeable U.S.-based consultants here in the United States who are speaking your language, and they're located in or close to your time zone.

The Corporate Health Check Project is noted on the slide. And that's a detailed audit of your global entities. It helps us to do three things. First, it helps us to understand your current entity statuses for your global portfolio. We use this audit to understand what has or hasn't been completed for all of your identify . . . oh, my goodness, for all of your entities, you're able to identify any deficiencies that might exist. Things like missed annual filings, missed annual general meeting filings, perhaps an incorrect number of officers or directors in place, incorrect addresses, or just changes that you haven't filed with the Business Registry. So we identify those deficiencies through the Corporate Health Check.

The second function is uncovering the current data and information for your global entities such as your current places of offices of directors, hours of attorney, jurisdictional IDs, share capital and ownership records, and a complete understanding of those obligations and deadlines that are required for your portfolio.

And then lastly, the Corporate Health Check includes the migration of that set of data into the technology. So again, as David said, you get the service components, and you get the technology component. And then all of our Global Services are broken down into flat rate prices in U.S. dollars. This will provide you with budget certainty, and it allows you to understand exactly what your spend is going to be for maintaining each entity in each jurisdiction.

It used to be really difficult for our clients to understand their current spend with these other systems in place such as working with in-country law firms. But with our Global Subsidiary Management services, there are no surprise fees. You're not going to hear from us down the road that we need more money from you for your filing, or perhaps some regulatory changes happened and now we need to be nimble and address those items. We're not going to surprise you with extra fees. It's what we say you'll pay is what you pay for those projects.

And when jurisdictional requirements do change, if perhaps a company's access get ratified or new procedures are released for how to maintain your global corporate secretarial responsibilities, CSC is not only going to be the first to alert you to those changes, but then we'll also proactively handle all of those needs that arise from those changes in an expeditious, but very cost effective manner here.

This next slide talks about CSC's entity management technology. And we'll take a look at some components of the upgrades and modifications we've made to our entity management tool. But as we said, we're very unique. Not only are we an exceptional service provider, but we also specialize in the technology to organize and centralize your portfolio.

Entity management, CSC Entity Management is our premium portfolio management tool. And again, it's completely integrated with the Registered Agent services, so it provides you with an automation of data and documentation, and also provides you with a robustly customizable tool that allows you to really pick and choose what other kinds of data and information you would like to track or manage or report upon in your portfolio .You have the ability to create an unlimited number of custom fields for your corporate data, for your calendaring obligations, your officers and directors. You have the access to a limitless repository and storage space for all of your minute books and other documents and files.

Optical Character Recognition is automatically applied to make all of your documents and information within the platform text searchable and easily identifiable and accessible. It also provides you with stock ownership management, and from those records, the ability to dynamically create robust graphic or text-based org charts in an automated fashion. You can even apply formatting rules to modify details or entities on your org chart, like your entity shape, you can apply different colors to your org chart.

We have a Section 16 filer component which allows you to seamlessly create, preview and transmit your form three, four and five directly to the SEC in the EDGAR database. You also have access to robust reporting capabilities, not just the ability to build your own reports, but also some very robust reports that CSC has pre-built and placed into the application for you, like your corporate data sheet, your officer and director reports, or a comprehensive audit report. We even include custom reports designed specifically for our clients at no additional cost.

And we are about to get into again, those regular updates and enhancements. We release these upgrades and new features about every three or four months on average, and that allows us to continue to provide the best resources and support to meet your portfolio management needs. Those updates and enhancements are distributed to our clients automatically without the need to pay additional money or to go through a complicated installation process. And upgrades and enhancements made to the technology are based on user feedback.

So part of David's and my job is to listen to our clients and our prospective clients as we speak about your needs and the challenges that you have. And from those discussions, we bring your contributions and your ideas back to our development team, and they become really integral part of the product developmental roadmap.

David: So with that said, let's actually get into the recent roadmap for CSC Entity Management. So this actually, is just a snapshot of the last year-and-a-half. So Andrea mentioned that our normal cadence is that about every three to four months, we're rolling out new functionality, but we're not afraid to do more in a shorter span of time, which I think this slide might be an indicator of. And so we launched an exciting upgrade around linear text-based org charts to complement the really powerful graphical charts that we've had on our platform for a number of years.

The on-demand change report is something that we're quite proud of. So we talked about this in terms of security. When you're evaluating a platform, you'd want the ability to understand who made a change, when was that change made? What's the before/after information look like? And historically, we could provide that information via reports, but it was something that we would have to do behind the scenes and then sort of, you know, provide as requested. Now, that type of a report, we call that a change report, it's available at your fingertips. So on-demand at any moment, if you want to get that oversight and insight into the change that's occurring in your portfolio, you know, we have reports that gets you that information in an incredibly digestible fashion.

One of the really big upgrades that we made that people get pretty excited about is drag and drop for documents. So instead of having to go to an action menu and say, "I want to upload a document," and browse and locate it and click on it, which becomes sort of analogous to when you want to attach something to an email, now, organizations with our software have the ability to literally click on a document, drag it over into a folder, and let go. And it's never been more simple, never been more efficient to import documents into our platform.

When we talk about managing documents in CSC Entity Management, we certainly appreciate how sensitive many of these documents can be. I think before we talked about the idea of uploading things like consents and resolutions. And so certainly, you, as an organization, want to have a great degree of control over who can access those documents. And so we introduced what, again, we refer to as Folder Level Security. So within our platform, I could say, as an example, "Let my colleagues see documents that I put into an articles folder." You know, they can see documents, perhaps in a file or a folder. But, you know, if I've got a folder for minutes, maybe that needs to be off limits. So let me pick and choose again down to the folder level, which document a colleague of mine would have the authority to see within the solution.

With all that said, the big item that we want to focus on today is Custom Entity Layouts. So this was launched just two weeks ago and it's a culmination of a lot of requests that we've had for some time where organizations are looking for a better way to capture unique information from one company to another. So we think we've done a really good job. I would say our product development team has hit a Grand Slam here with making it really simple and efficient to have different types of information for your subsidiary.

So the next slide is more of a kind of a takeaway slide for folks that might download the presentation. Annie talked about the ability to download material from the web conference in full. So I don't intend on sort of reading through bullet by bullet. But honestly, I sometimes even use this for my own reference because I can't remember how many awesome things we kind of crammed in to adding again, greater flexibility to customization.