Recorded Webinar: Simplifying and Centralizing Global Corporate Governance

Simplifying and Centralizing Global Corporate Governance

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Global corporate governance is complicated because each country has its own requirements, governance policies, and compliance demands.

Join us for a free webinar as we explain how CSC® can help. During this webinar, you will learn:

  • The challenges of achieving entity compliance and maintaining corporate secretarial functions internationally
  • Ways to centralize your data and documents for visibility into all your global subsidiaries
  • Global legal entity identifier requirements
  • And more...


Webinar Transcript:

Annie: Hello, everyone, and welcome to today's webinar, "Simplifying and Centralizing Global Corporate Governance." My name is Annie Bruxelles and I will be your moderator. Joining us today are John LaPalomento and Andrea Jonaitis. John is the product manager on CSC Global Subsidiary Management team. He's been with CSC for over seven years, previously as a sales team leader and a product engineer with CSC Matter Management Solution. John works with GSM prospects to present an accurate and clear scope of services and remains in contact with them as the overall relationship manager for all GSM clients.

Andrea is a sales engineer at 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 in compliance, as well as demonstrating CSC Entity Management. And with that, let's John and Andrea.

Andrea: Hi, Annie. Thank you and good afternoon to everybody who's joining us on the webinar today. Welcome.

John: Yeah. Thanks everybody for joining us. Of course, those of us here in this hemisphere, good afternoon and for those of you in the east, thanks so much for joining us in your evening hours. We're going to be talking today about our suite of Global Subsidiary Management services and we're very excited to explore that with you. I'm going to be a bit selfish here right out of the chute and tell you that my favorite part of webinars are answering your questions that come in. So, please do not hesitate to utilize the Q&A widget on your screen right now. Enter your questions and we look forward to answering them towards the end of today's call or perhaps even during the call if they're applicable at that time. With that being said, I'll hand it to Andrea.

Andrea: Great, John. Thank you. So, let's start with taking a look at our agenda for today's webinar. Today, we'll begin by discussing the challenges of managing a multinational entity portfolio, and the ways in which CSC can assist you with your global corporate governance. We'll then talk about how to understand the status of entities and achieve international statutory compliance through the corporate health check.

John and I will share with you our core service to support your global portfolio, maintaining your international subsidiaries through our annual compliance support. Also, we'll discuss international transactional work that CSC can assist with and we'll talk briefly about global legal entity identifiers or global LEIs as you may have heard them referred to previously. And finally, we'll talk about how to maintain trustworthy data in a central repository with CSC's award winning entity management solution. We'll also have the opportunity at the end of our session today to view a demo of CSC's Entity Management platform together. With that said, let's get to our first topic today which is the challenges of managing a multinational entity portfolio.

Throughout our various conversations with our clients and prospective customers, John and I regularly hear some recurring themes that come up as a list of challenges that companies are facing when it comes to managing their global portfolios. One of the biggest challenges that we hear is expertise or a lack of expertise, if you will. Clients are approaching us here at CSC for help with managing their global portfolios because there are so many nuances that vary from country to country, and these nuances are very different from U.S. law and what most of us are familiar with domestically.

It can be really difficult to understand the nuances and the differences between the countries, and to understand to know all of the requirements that are necessary to conduct business in other countries. It's very easy to feel like, entities can or the international entities can and should be managed or handled similarly to the way that we manage corporate secretarial requirements in the United States, and that's just not the case.

Managing those global entities and the requirements for them is really not as straightforward as appointing a simple registered agent or filing some reports throughout the year. It's really important that a company has an expert or team of experts in place that can really help you to understand the complexities of the various jurisdictional needs in order to have the peace of mind that everything in your portfolio is being handled appropriately and that nothing is being missed or overlooked.

Another challenge of managing a global entity that we often hear is logistics. So, clients will come to us and they'll tell us about their struggles with their previous vendors where they're trying to manage and coordinate multiple projects with all of those multiple vendors around the world and the impact that it has on their time and resources. Typically, when working with multiple vendors, those vendors are located in other countries, often they're in other time zones or inconvenient time zones, then adding to the struggle is the receipt of invoices in different currencies. Sometimes the currencies may fluctuate which can add the challenge and even more frustrating is language barriers. If those vendors don't speak English it can be very frustrating to try to communicate and get business done in a timely fashion.

With those logistical challenges it's very easy to become overburdened by the process or confused as to what has or hasn't been completed. And really we hear it all the time in our daily conversations with customers who are considering our services. They may begin their conversations with us with, "Well, I think our vendors are handling those responsibilities," or, you know, "I really hope they are." So that can be very challenging.

Also challenging is understanding cost. In addition to the fluctuating currencies that I just mentioned a moment ago, creating a budget or understanding the current spend for services associated with managing global entities can be very difficult. When you're dealing with law firms in particular, you're at the mercy of hourly rate and potentially unclear invoices for services rendered. It can be very tough to match up cost for your specific entities within your portfolio and challenging to discern the difference between the fees that are tied directly to the management of those entities versus fees that are charged by your vendors for some other unrelated services. And very unfortunately, John and I also speak with companies that have received surprise invoices from their vendors for standard or routine filings, and services. And really nobody wants to receive a surprise invoice or to have extra charges of that or above and beyond what was originally discussed.

And lastly, our customers talk a lot about the challenges of data management. It's really important to have a system in place that meets all of your needs, and allows you to centrally see and manage your data and documents for each of your entities around the globe. And it's even more important that you're able to feel confident that the system that you have in place is reliable and up to date. And it's often times very challenging to achieve that peace of mind. Excel spreadsheets and network share drives are . . . we hear about those all the time and they can really help to ease the burden quite a bit, but those processes are still very manual, and they can easily become outdated or incorrect when there are other pressing responsibilities that need attention.

And companies also tell John and me quite often that they are very dependent on their vendors to provide them with updated information or documents as a prerequisite to getting those manual systems updated. And if that communication isn't received from those vendors or they are not filtering the data or documents to the companies, then the system breaks down despite those organizations' best efforts to keep that system functioning properly.

John: Let's go ahead and take some time to introduce the CSC Solution which we call Global Subsidiary Management. Global Subsidiary Management really is a fancy way of saying corporate secretarial services around the world and we do so through a centralized platform. You know, CSC is a long standing company with a long legacy behind us and largely people understand us as an American service provider. We've actually been working internationally for over 40 years and in this space, specifically in the corporate secretarial space which really came to light over the last decade. We're here to provide you with a centralized and simplified approach.

So, Global Subsidiary Management or as commonly referred to as GSM truly is about centralization and simplification. We're here to take a two pronged approach with centralization where we're focusing on both the centralization of your workflows for one trusted U.S. based team as well the centralization of your data and document management in a self-maintaining online award winning platform. GSM really does simplify the way you're currently maintaining these levels of corporate governance and brings absolute certainty and success.

GSM really is a partnership. I hate to use the word, "outsourcing." I think it's misleading. Frankly, our services can't be an outsourced service. There's no way for us to wave a magic wand and for your workload to disappear. What it really is is a partnership and it's your team and our team working together harmoniously to achieve success in the world of corporate governance.

Frankly, our team access an extension of you, an extension of your legal team to ensure success around the world. Our team centrally is located here in Wilmington, Delaware with hubs for our service out of our London, England office, and our Hong Kong office, many different offices around the world on the CSC side. And through our vetted and trusted partners, we offer this service in over 140 countries around the world. You can feel comfortable in partnering with CSC for complete global coverage.

GSM truly is flexible to meet your needs. We have clients all the time who have needs for different entities and even in the same jurisdiction where you may have different needs and we're here to be absolutely flexible. There's no cookie cutter solution. Quite frankly it's a job that falls on my and Andrea's shoulders to understand the need that you bring to the table and for us formulate the proper solution to meet those needs.

GSM is comprehensive. We're not here just to handle part of the corporate governance job, we're really handle to handle a complete corporate governance job. We understand the differences and the nuances from jurisdiction to jurisdiction, and we're ever morphing to be able to fill those needs.

GSM along those lines is truly dynamic whether it's constant change, whether it's changing organization like maybe people leaving or new hires or change that happens on the outside, maybe a new company is asking you ratify it somewhere. We're here to understand comprehensively what has to happen so you're set up to succeed.

GSM is efficient. As opposed to duplicating your efforts around the world with many different firms, law firms, trust companies, miscellaneous service providers, and perhaps struggling to fit into the workflows that they design, we're here to refine those efforts and make one project out of what could be 20. And frankly, operate according to the way you asked us to operate. We're truly here to efficiently be your right hand.

GSM is cost effective. We're here to refine your services through one trusted partner and naturally, when you do that you're going to see cost effectiveness become prominent. As opposed to paying hourly rates to law firms, you're going to see flat rate cost in U.S. dollars. We're here to be a cash flow positive solution for your company.

Truthfully, I say this all the time more than once a day, GSM is a marriage of CSC's time-tested service and our award-winning technology. I would say that there's two different types of service providers in this space and there's some blurred lines between the two. But none of them do exactly what CSC does in the marriage of service and technology. There are certainly service companies out there, perhaps some law firms and they may not have the same global coverage that CSC has, but they're still trying to handle the service aspect of corporate secretarial services. But largely, the management of data and documents falls outside of their scope. There's also software providers who were doing nothing more than generating software and some of it is strong, and some of it is lackluster, but none of it involves the service aspect. CSC truly bring those two components together and we're here to create that perfect blend.

Ultimately, GSM really is peace of mind. Our talented people both here in Wilmington and around the world, together with our awesome technology gives you transparency in your data, gives you complete understanding of your entities around the world, their current statuses. And quite frankly the peace of mind that if anything were to change, whether it's internally or some force externally, CSC is here to back you up and make sure that we're taking into consideration all of your corporate secretarial needs. We take a very, very personal approach over here to assist.

Andrea: Absolutely. Thank you, John. When clients come on board with CSC, the first step in the process together is to understand the status of the entities and the requirements that are necessary to keep those remaining in good standing. And this is achieved through the corporate health check. You may or may not already have heard of this term before, it's not new, but I'll briefly talk about it now. So, the corporate health check, this is going to help us to achieve that peace of mind or to really kind of figure out where we're starting from in terms of the entity status. It will be a comprehensive audit of your global entities and it's going to help us to do three things.

The first function helps us to understand the current entity status. So through a review of the data from the public registry in country, CSC is able to understand what has or has not been completed for each entity and to identify any deficiencies within a global portfolio according to the business registry that may need to be addressed. Some of the common deficiencies that we uncovered through our corporate health check include things like missed annual general meeting filings or other general filings, incorrect number of directors in place, incorrect addresses on file, and other company changes that just weren't updated in the registry.

The second function of the corporate health is the actual uncovering of the current and correct data. The corporate health check will give us data such as officers and director slate, powers of attorney, jurisdictional IDs, address information, share capital and ownership information, and we'll also get a complete understanding of the filing responsibilities and the deadlines by entity.

After the corporate health check is completed, your dedicated project manager will review the results with you and if deficiencies do exist in your portfolio, they'll sit with you to develop a plan for remediation and to assist in the process of bringing those entities back into good corporate heath.

And the third function of the corporate health check includes the migration of the vetted data, the requirements, and the deadlines into CSC's Entity Management platform. Our proprietary technology solution captures that current entity information and provide our clients with visibility and complete transparency across their organization in one secure and easily accessible central repository. And that data forms the foundation for our core service of ongoing entity maintenance which we refer to as annual compliance support.

John: Excellent, Andrea. Thank you so much. So, let's go ahead and get into annual compliance support and talk about some of the nuances to our service. Because frankly, our service is so flexible. There's so many different needs from jurisdiction to jurisdiction, but there's also different needs from client to client. So, we're just going to talk about this fairly broadly today. Of course, we won't talk about the differences of managing a Brazilian company versus an Indian company versus an English company, but what we will be doing is taking a high level overview of annual compliance support.

The first and in my opinion the most important takeaway is that while all of these services are flexible from place to place, we're proactive. You're going to be working with one project manager here in our Wilmington Delaware headquarters. As mentioned, we have global coverage for these services in our own network, our own hubs and offices. So if there's a need to work local, you'll have that luxury, but most commonly our clients are looking for centralized approach. And that really is the hallmark of CSC's Global Subsidiary Management services. So, please know that. We're here to take that proactive approach and work with you again as an extension of your team through regularly scheduled communication.

Let's go ahead and take a look at what largely entails CSC's annual compliance support. It really is about taking on all of the necessities of your entity's corporate secretarial management in the country. Anna asked the question and Anna, thank you so much for the question. I love your name. It happens to be the name of my oldest of three daughters. So, it's a name dear to my heart. You asked the question about the drafting of annual general meeting documentation and how we would draft that for you. And that's certainly is a big part of what we do. In fact, we're here to maintain your minute books, oftentimes maintaining in country what has to be held physically, but also digitally maintaining everything. We're also going to manage and maintain your shareholder registries, and officer and director slates. In terms of that annual general meeting need that Anna had asked about, we are here to prepare and if there's a filing, take on the filings of your annual general meeting consents and resolutions.

Everything that we draft, we do so in dual languages and we loosely used the term, "annual general meetings" because in jurisdictions like Spain and like India where there are quarterly meeting requirements where we would take those on as well.

In all jurisdictions where there are filing requirements due to the business registry we will take on those filing requirements. These filings of course come in different names, but commonly you'll hear things like your annual financials, your audited accounts, we'll look at the filing of your confirmation statements, and so on. And we'll actually draft lots of those filings for you as well.

When it comes to the drafting of documentation if it's financial in nature, largely your accountants or CPA would continue to put that document together. What is oftentimes overlooked is the subsequent filing. When we perform the corporate health checks, we commonly see a lack of filing or missed filings around those types of financials and know that we're going to take care of that for you even liaising with your financial personnel to ensure that were handling everything that has to be handled.

In many jurisdictions we'll handle for you registered office or domiciliation. Now, in some jurisdictions domiciliation is part of our standard offering. In jurisdictions such as Canada, the United Kingdom, Hong Kong, Singapore, Australia, South Africa, and many others we're here to . . . I'm going to push this slide to the audience and make sure everybody's looking at the right slide. I apologize. In those jurisdictions, it really makes sense for your corporate secretarial partner to be handling the provision of registered office. But certainly in other jurisdictions, you may have needs. Maybe you only have a sales team in Germany and you don't have a physical location. Well, Andrea and I will understand that is a need and be able to build that into the plan that we formulate for you.

Very similar with services such as local directorships, resident director, nominee director, local company secretary, and other types of appointments. We can oftentimes take them on. We will understand that and include that as a part of our annual compliance support offering.

Very importantly is the automation of entity data. You may recall, I talked about centralization in two prongs and this is the second prong. It's the centralization of all of your entity data and documents that we generate through our award winning CSC Entity Management platform that becomes an automated platform. You still have all of the capabilities of enhancing the platform, adding your own attributes to collect, reporting against of all of the data, but everything that CSC does will be pushed into that system for your view.

Very importantly and again to restate myself, this is a U.S. based service team and this is completely CSC. We are not outsourcing these services to other firms. We're here to support you with CSC employees based largely out of our Wilmington, Delaware headquarters and as mentioned in different hubs around the world. One of the most attractive pieces that you'll see here are the fact that we're going to offer these services in bundles flat rate pricing modules. We make it very simple from a budget certainty standpoint and we make it very easy from a cost consideration standpoint. We're certainly happy to expand upon that as we move forward. Some additional support that we could handle for you, I'm happy to hand it back to Andrea to discuss international transaction services.

Andrea: Sure. Outside of the scope of the annual compliance support services that John just spoke about, CSC can also help our clients with other needs that arise that are separate from the general day-to-day needs. These include projects like officer and director changes, ad hoc resolution draft, transfer of share capital, document retrieval, research projects or a formation and liquidation support, and other projects, many more projects above and beyond that. When the changes occur within your global portfolio, CSC can help to simplify these projects using the same streamlined and centralized approach that really sets us apart from the competition.

One of our favorite examples that we like to use to really illustrate how centralized and easy this process is and this partnership between us is a very common director change example of that I feel will really resonate with many of you that are on the webinar with us today.

So let's say for example, that you have a director who is a director for many different entities around the world in your organization and this person is retiring. This is a very frequent occurrence and very commonly, people will tell us how they would handle such a project and they'll say something like, "Well, what we used to do is reach out to our law firm in Brazil. We will contact the firm in Singapore. We'll touch base with the vendor in Australia." And so on, and so forth. And then they quickly find themselves wrapped up and juggling 20 different projects in 20 different countries for the retirement of one director.

Wouldn't it be so much easier for you if you could simplify that with just a call or an e-mail to your project manager here in Wilmington, Delaware and you could say, "Susan retired, what do we have to do?" And from there, we're going to assess the scope of the project with you, we'll evaluate the best course of action, and really customize a perfect solution for you, so that rather than managing those 20 projects in 20 countries, you only have to manage one project with CSC spearheading the efforts to manage and execute that change on your behalf with each of those jurisdictions independently.

We have the knowledge and expertise where we understand places where we can mitigate your costs versus where we need to be a bit more expeditious in order to avoid additional fees or penalties. We would know for example that if we needed to execute a director change in Australia and there was an upcoming annual general meeting in the next 30 days, we could hold the change into the meeting, and we could avoid the extraordinary measures and additional fees.

And conversely we would also know that if we were working in a Hong Kong or Singapore for example, we would need to be a bit more expeditious in handling that change where Hong Kong requires that to be handled within 15 days of the change and Singapore would be 30 days.

And very similarly to our annual compliance support services, we provide this transactional work in flat rate pricing and we always provide you with that budget certainty. And you also get the benefit of as John said, the automation of the data into the entity management platform. All of the work that is completed by CSC on your behalf automatically flows into the CSC Entity Management solution and so, all of that data and the documentation becomes available to you in real time as those changes are executed on your behalf.

John: Excellent. I'm happy to briefly discuss our services around global legal entity identifiers or GLEIs as these are commonly called. Don't feel bad if you don't know what this is. It may not be applicable to you. In the banking and financial worlds however, over the past three years this is something that has come to the surface and is available, and maybe in the necessity for your entity or some of your entities globally.

After the banking crisis of about five years ago, there was really questions as to if banks understood to whom they were lending money. Lots of companies were receiving financing from many different financial institutions without those institutions being aware of other loans that had been originated. The concept of global legal entity identifiers essentially acts as a social security number for your entity that is registered with certain clearing houses around the world and is recognized globally. It's a 20-character reference code and it does uniquely identify your company as a specific entity.

With that being said, you may not have the need and I would certainly recommend some additional research on your behalf. If you're already familiar with this concept, you probably already have a GLEI. And I'm happy to say that CSC does support the registration for new legal entity identifiers or services to make sure they are kept up to date. It very much falls in line with our services that we provide here at CSC, the recurrence of understanding need for renewal of licensure or in this case, legal entity identifiers. If you have more questions, feel free to reach out to your account manager here at CSC. We'd be happy to schedule a consultation.

Annie: Thanks, Andrea. And thank you, John. Folks, that's all the time we have for today. Just as a reminder, you can download a copy of today's material from your resource widget. 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.