For this Q&A on Ops trends, FTF News spoke to Gerard Bermingham, executive director, business development, IHS Markit/Information Mosaic, and Ellen Schubert, CEO, IHS Markit KY3P.
(Editor’s note: FTF News recently got time with Gerard Bermingham, executive director of business development at IHS Markit/Information Mosaic and Ellen Schubert, CEO of IHS Markit KY3P, a subsidiary of IHS Markit. The discussion covered industry trends and milestones that helped IHS Market win the Best Corporate Actions Processing Solution and Best Operational Risk Management Solution honors via the 2017 FTF News Technology Innovation Awards. Bermingham has been with Information Mosaic since 2003 and has served in key roles such as global head of customer satisfaction and director of product consulting. Before joining IHS Markit in 2015, Schubert spent a year consulting to women-owned hedge funds, both start-ups and established funds on various aspects of their marketing, human resources and compliance policies, officials say. She spent 2009-to-2014 as chief advisor to Deloitte’s asset management services group, advising hedge fund clients on issues including operations, product structuring, and regulation.)
Gerard Bermingham, executive director, business development, IHS Markit/Information Mosaic
Q: Looking at the company’s milestones, IHS Markit had a major one last year via the merger. What have been some of the major impacts of the merger upon clients and product offerings?
GERARD: In a conference call to investors [June 27, 2017] reporting the company’s financial results for the second quarter of fiscal year 2017, Lance Uggla, IHS Markit president, said the company continues to “feel good” about achieving its stated objectives post merger.
Revenue synergy wins to date, he said, have been across the globe and have focused mainly on selling our resources, auto, maritime and trade and economics and country risk products and insights into financial services customers.
Additionally, IHS Markit has validated the potential to sell our valuation services and enterprise data management technology into our resources customers with early wins.
Q: What corporate actions trends in 2016 did IHS Markit take advantage of?
GERARD: We see many organizations strive to simplify their business architectures by centralizing asset servicing operations across multiple business lines and geographies.
Often termed “enterprise utilities,” IHS Markit’s Information Mosaic technology supports these transformation programs by providing a single multi-entity platform that enables a mix of both central and local corporate actions processing.
Another trend evident in 2016 is the growth of corporate actions volumes and complexity. This growth has presented challenges for operations teams globally, with increased risk of financial loss and reputational damage.
IHS Markit’s corporate actions validation service (MCA) provides its clients with a fast and accurate understanding of CA [corporate action] events enabling them to reduce risk and provide reliable and timely CA information to both internal and external customers.
Standing on the left, Ellen Schubert, CEO, IHS Markit KY3P
Q: Were there any developments in operational risk last year that IHS Markit foresaw before its competitors?
ELLEN: There is always a constant stream of changes in the operational risk and regulatory compliance space, whether they are driven by new regulations rolled out or developments in technology that can enable customers to increase efficiencies.
At IHS Markit, we understand the importance of keeping a pulse on the regulatory environment so we can upgrade our solutions with new functionalities to not only help customers meet compliance, but stay ahead of the curve.
In the third-party, risk management space for example, cybersecurity is now even more of a top concern with the emergence of high-profile data breaches such as the WannaCry ransomware attack as well as mainstream media coverage of private email server hacking over this past year.
We are seeing more of our customers come together to solve these common problems which contributes to the robust community we are building.
We were also pleased to announce earlier this year Barclays, Goldman Sachs, HSBC and Morgan Stanley signed an equity stake in our KY3P third-party risk management solution.
We are confident this consortium of engaged design partners will prove to be a game changer in delivering innovation.
Q: What trends in corporate actions does IHS Markit foresee as significant for 2017?
GERARD: Building on the enterprise utility strategies seen in 2016, we are also witnessing a growing interest in “industry utilities” where different financial institutions come together to mutualize technology infrastructure costs and share a common processing layer for non-differentiating business processes.
For the larger players in the industry, this approach can impact cost/income ratios through enabling organizations to allocate capital more effectively and focus on areas where they have a competitive advantage.
For the smaller players in the market, where simpler business flows are more common, we are experiencing demand for our cloud offering that provides end- to-end corporate action lifecycle management.
Of course, when looking at 2017, no conversation would be complete without mentioning blockchain.
Many industry participants, including IHS Markit, are undertaking POCs [proof- of-concept trials] on different aspects of the corporate action value chain, gaining insight into this emerging technology and how it can be applied to solve industry challenges.
Q: What are the major developments in Op Risk that could prove to be important for IHS Markit and its customers?
ELLEN: Every customer, whether it is a big bank or boutique asset management firm, is grappling with how to efficiently manage the ongoing stream of regulatory mandates.
From left to right: Eric Maldonado, Managing Director, Sales at IHS Markit; Ellen Schubert, CEO, KY3P; Julia Kubis, Managing Director at Morgan Stanley; Jonathan Pressman, Director, Sales at IHS Markit
As teams formalize best practices around KYC [know your customer], tax, third-party risk and counterparty risk, the keys to successful implementation revolve around defining the right mix of people, processes and technology.
We are seeing customers looking for more ways to streamline their operations and data is at the core of this initiative. We have created a strong foundation in providing solutions to our customers to reduce manual data entry, costs and time associated with managing risk — all while ensuring data is accurate and up to date.
For KY3P, in particular, we are continuously updating our services and we have recently designed a number of new features including a revamped advanced dashboard, risk calculator capabilities as well as a new Significant Event Notification and Tracking (SENT) functionality to alert customers to potential cyber-attacks.
Q: How would you describe the business philosophy for IHS Markit?
GERARD: IHS Markit harnesses the deepest sources of information, analytics and expertise to forge solutions for industries and markets that drive economies worldwide.
We partner with leaders in business, finance and government to help our customers be more efficient and make more informed decisions to secure their future.
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