YEAR IN REVIEW

ACSA has released a “view on demand” webinar that features ACSA’s 2020 achievements, and priorities for 2021.

A copy of the slide deck is on the website here, and the webinar can be viewed in our Member Update.

CORPORATE ACTIONS STP PHASE 2

This initiative from the ASX is being conducted as a “business as usual” enhancement to efficiency and is separate from the CHESS Replacement.

A number of ACSA members are represented on the working group convened by the ASX.

To support additional automation, public consultation about proposed Listing Rules changes opened on 30 November. These changes cover the use of online forms, notification of security issues and corporate action timetables.

Although predominantly focussed on issuers, the changes in this tranche include proposed listing rule amendments that codify deferral of dividends.  This was a specific topic of ACSA advocacy from earlier this year.

ACSA believes that ongoing focus on corporate events is important from both risk and efficiency perspectives and we are highly supportive about continued positive change in the direction proposed.

SUPERANNUATION DATA TRANSFORMATION

As mentioned in the last update, ACSA made three submissions to APRA during the consultation period that ended on 13 November 2020 (you can read them at Submissions).

In these submissions ACSA provided feedback on both the principles that we believe should guide regulatory data frameworks, and also specific practical examples of where the new regulations could create significant implementation challenges.

Industry consultation, including workshops, to identify pathways for efficiency, consistency and robust application of the new data requirements will be needed, with engagement commencing as early as possible in the new year.

PROXY VOTING

The peak proxy season just ended demonstrated yet again areas where greater codification would lead to more efficiency, transparency and lower operational risk.  ACSA’s advocacy for change continues, including further submissions to Treasury and government to have a regulated voting entitlement record date included as part of the Corporations Act modernisation initiatives expected to come before federal parliament early next year.

Current problems arise because the entitlement date is not standardised and too close to the deadline for lodging proxy votes.

• The current deadline to vote via proxy is 48 hours before a meeting. 
• Companies and their share registry providers do not have the ability to view real-time holdings of shareholders – and as a result they typically take entitlements to vote at the end of the last business day two days before the meeting (e.g. a meeting on Monday or Tuesday would have holdings taken at close of business on Friday, a meeting on Wednesday could have holdings taken at close of business on Monday).
• The holdings in a company can move significantly following trade settlement (a batch process competed at 11.30am by the ASX CHESS system). 
• Owners can potentially under or over vote as a result of these movements. That is, votes are cast before holdings are set by the company share registries.
• Moving the voting deadline to a time after entitlements are set will create certainty for all holders to vote on a fixed and known position, and create consistency across all listed companies.

Standardisation of voting entitlements improves efficiency and certainty, and aligns to international best practice.

INDUSTRY STATISTICS

The six-monthly collection of statistics is about to kick off for the period ending 30 December 2020.

ACSA Statistics are import as key metrics of our industry and assist in our advocacy efforts by demonstrating size and volumes.

As at June 2020, the industry held $3.75 trillion in assets under custody for Australian institutions, up from $1.74 trillion over the decade from 2010.  

ACSA first began collecting industry statistics in 1996, and in December that year a total of $285 billion was held in custody.  This represents an average annual growth rate of 11.6 percent in total assets.

MERRY CHRISTMAS

Finally, on behalf of ACSA, wishing all our working group volunteers, the extended securities services community, families and friends a safe and happy Christmas. 

The ACSA Office will be closed from 23 December to 8 January inclusive. 

See you all in 2021!

Robert J Brown

Chief Executive Officer