Banco Santander and Broadridge Financial Solutions have completed a first practical use of blockchain for investor voting.
The implementation includes a solution that employs blockchain technology enhances global proxy vote transparency.
Additionally, it increases operational efficiency, security, and analytics, which are beneficial for investors, issuers, agent banks, and custodian banks.
In collaboration with J.P. Morgan and Northern Trust as custodian banks, Santander and Broadridge conducted the pilot on 23 March for Santander’s annual general meeting (AGM).
This was conducted with participation from Banco Santander Corporate Services as the issuer’s agent and Santander’s blockchain lab.
The pilot was run in parallel to the AGM, with blockchain being utilised to produce a ‘shadow’ digital register of the proxy voting taking place in the traditional model.
The co-collaboration model was extended to additional global custodians participating during the Santander AGM.
During the last AGM, institutional investors had the opportunity to see how their votes could be counted and confirmed much more quickly.
It will be possible to do this instantly thanks to the blockchain technology as opposed to waiting two weeks in a process that includes manual activity by a different intermediary.
Patricia Rosch, president of investor communications solutions, International at Broadridge, said: “The successful completion of a second pilot along with the next phase of our blockchain-based proxy voting solution demonstrates Broadridge’s continued commitment to developing innovative technology solutions in the re-imagination and improvement of global proxy to help our clients get ahead of today’s challenges.”
Sergio Gámez, global head of shareholders and investor relations at Banco Santander, commented: “In the case of Santander, having very fragmented capital, it is very important to ensure the participation by investors and shareholders, and this year using blockchain technology for the institutional vote has been a great help in terms of transparency and agility across the vote lifecycle.”
Luis Antonio Perez, head of Corporate Services at Banco Santander, said: “The blockchain technology has enhanced efficiency and transparency upon the reception and vote tabulation process, which will result in bridging the gap between all in the process.”
Justin Chapman, global head of market advocacy and innovation research at Northern Trust, said: ‘’Corporate governance is a key focus for our asset servicing business and we are pleased to include one of our clients, Legal & General Investment Management Limited, as a pilot investor in this important initiative as we extend our collaboration with Broadridge.”
He added: “We are excited about the next phase in creating end-to-end vote transparency using blockchain as an enabler.”
