Shareholder Monitoring and Disclosures: Keeping One Step Ahead of the Front Office

Fresh from our London conference “Looking at the Year Ahead – Global Compliance and Data Priorities” – a rousing success! – we’ll cover takeaways from a key panel discussion on shareholder monitoring and disclosures.

Two of the best in the business were in the house (or should we say “in the brewery,” an amazing London venue that dates back to 1750): Darren Fox, Partner at Simmons & Simmons, and my colleague Mike Marmo, Product Manager at CSS. Together, they paired as a complementary set of experts from the legal and data sides, respectively. So let’s explore the areas they covered, and here we’ll also reveal what they saw as the top pain points – as well as some unexpected ones – faced by asset managers.

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For the uninitiated, we can quickly define the topic discussed: Shareholder filing obligations are imposed by local regulators when reaching certain ownership percentages in issuers (often starting as low as 1-3 percent) or short positions in issuers (as low as 0.01%) based in those local jurisdictions. Additional filing requirements often apply if the issuer is involved in a takeover bid, does business in a certain protected industry, or chooses to impose its own additional filing thresholds.

Shareholder disclosure affects most or virtually all of the asset management industry, as a big show of hands in the room confirmed. The biggest challenge? The attendees from the industry were more split on this point, but a top concern was keeping up with the various local regulations across the world. The point was addressed with invaluable detail from Darren Fox who, among his several roles at Simmons & Simmons, heads up Navigator, the global law firm’s regulatory database of shareholder disclosure rules.  He stressed that investment managers, which are among his clients that may trade in securities across several dozen jurisdictions at any one time, are served well by (1) closely monitoring regulatory news developments around the world, and (2) engaging a partner – be it a compliance consultant, a platform for monitoring holdings, a law firm or otherwise – with global experience and expertise in shareholder disclosure matters.

Top pain point: Aggregation of holdings across affiliates
Surprise pain point: Position limits (maximum number of contracts you can hold in certain categories of derivative products)

Having the right reporting data was another major concern expressed. This was confirmed by Mike Marmo, whose experience as product head of CSS shareholder reporting platform Signal brought several thorny issues to light. These include identifying the relevant issuers (especially where dual- or cross-listed) and calculating holdings (with derivatives and delta calculations complicating matters). He added that properly sourcing third-party reference data – be it takeover panel lists published by regulators, registries maintained by ESMA or other databases – is a key to conquering the challenge.

Top pain point: Issuer shares outstanding data
Surprise pain point: ETF/index holdings

The discussion shifted back to Darren for yet another challenge: how to submit the filings once your holdings have reached a threshold in a particular issuer. While having to adhere to tight filing deadlines (as little as one day in some cases), a shareholder’s tasks such as navigating submission portals and handling local language requirements are common sources of frustration. As Darren and others noted, such obstacles can cause unexpected delays in filing, and therefore should be squarely addressed by investment managers well before reaching a filing threshold.

Top pain point: Which party notifies? Fund, manager, parent, appointee, etc.
Surprise pain point: Accurately transferring your data to the disclosure form

Thanks for reading. To learn more about our position limit monitoring and shareholding disclosure solution, visit our Signal page, and for more in-depth information on the topic consider joining us for our next compliance conference, held in Miami from April 15-17!


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CSS frequently publishes blog posts which are written by our team from their observations in the field, at conferences and through experiences with compliance professionals. These posts are designed to further knowledge and share industry best practices. Topics run the gamut, including Form ADV, cybersecurity, MiFID II, position limit monitoring, technology challenges and more. Complete and submit the brief form below to receive notifications when we publish new content.

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