The right entity management system plays a critical role in the corporate governance, compliance, and long-term health of an organization.
Investing in an entity management system is the best way to ensure that you have the highly specialized functions you need. But software alone can’t provide a permanent solution. Best practices in entity management include a holistic view that integrates people, processes, and systems. Ask any service provider if they use this type of approach, and assess their expertise and capacity to adapt their solution to your organization’s processes and people.
First level considerations
If a vendor meets the baseline criteria, assess for these three core areas: level of support, quality of data management, and ease of use.
- Support. The vendor’s expertise and willingness to provide ongoing support beyond implementation is integral to how you can stay current with industry best practices. Carefully assess the vendor’s capabilities, infrastructure, and adherence to security and quality standards.
Ask about their track record for successful system implementations, training programs, as well as handling complex or unexpected situations.
- Data management. You should look for data management that gives you the most flexibility, and a system that can automate as many routine processes as possible. An example of this would be a platform that integrates your entity data with jurisdictional rules and provides tools to automate compliance tasks. The ability to access your data from multiple perspectives - for example, by ownership, locations, and time frame — helps you quickly respond to internal requests for information.
- Ease of use. An entity management system fuels many corporate activities with vital information, so another key area to assess is how well the system can drive timely, secure collaboration across your organization. Good indicators of this include the ability to allow an unlimited number of users, and whether the system offers robust and flexible reporting capabilities.
Benchmarks for entity management systems
Once the vendor passes the first-level review, consider some of these other important elements in the context of the specific needs for your organization.
Controlled data management
The system should be uniquely designed for corporate business compliance. An entity management solution must support you through formations, mergers and acquisitions, withdrawals and dissolutions, and any other corporate action.
These basic features will maximize time savings and efficiency and help you easily track all your entity standings:
- a customizable calendar with full event alert capabilities
- the ability to upload multiple documents simultaneously into folders that are automatically organized by entity and document type
- customizable data fields.
Dynamic, robust reporting
Templates for both commonly used reports and customizable reports will enable a quick response to regular and ad hoc requests from management and regulatory agencies. Likewise, you should be able to generate custom organizational charts that accurately represent ownership structures.
Corporate structure history should be preserved to produce “point-in-time” reports for key information that varies over time, such as ownership and slates of officers and directors.
Users should be able to search both data and documents easily and quickly. Business entity data must be linked with the underlying documents that govern the data.
Best practices in corporate governance workflows
Role-based security settings are important for allowing “power users” to have complete control over security. Security settings must be precise enough so these users can approve data entered by other departments before they are merged into the database.
Workflows for inputting and updating information should be easy and transparent. For example, the system should have the ability to quickly generate unanimous written consents for multiple companies to speed the ability to create resolutions and have them signed.
The system should help eliminate redundant and repetitive manual data entry. Here are several use-case examples: the ability to automatically pre-populate compliance filings with entity data; retiring and replacing a director in many entities at one time; or updating a document owner across hundreds of documents at once.
The ability to store entity locations and all associated addresses is made even more powerful when integrated with a customized compliance calendar for tracking location-specific requirements and dates.
You should be able to view data on officers and directors from multiple perspectives. (For example, you may want to view by their role, which entities they have authority for, and their tenure.) Entity capital structure, management, and ownership should be linked so you can automatically cross-reference this information and track activity.
With many corporate governance and legal professionals working in hybrid environments or on-the go, the system must also be optimized for mobile technology.
Proactive ongoing support
Entity management should be a primary focus of the vendor’s business. Proof points include dedicated staff resources who keep systems and personnel apprised of compliance and governance updates, maintaining an ever-expanding knowledge base of best practices, and a team of expert support people available for outsourced services such as corporate record maintenance, document upload, and minute book scanning.
A comprehensive entity management solution must include consultative support from a team of entity management specialists. In addition to day-to-day support, this team will provide a wide range of important functions, including implementation, support for complex issues, apprising you of changing compliance and regulatory rules, and training on corporate governance and compliance best practices.
Implementation should be rigorous and systematic and include auditing, analyzing, mapping and entering all your existing company data, testing for consistency and accuracy, and alerting you to any issues.
Conclusion
You can streamline your compliance and governance processes by partnering with an expert entity management provider. Start your evaluation with a list of the features that will make your current workflows more efficient, accurate, and collaborative. Then, work closely with your vendor to fit the solution to your needs and experiences. Keep in mind that a comprehensive approach that combines technology, process, and people will give you the most effective, long-lasting solution for your entire organization.
Learn more
The right comprehensive solution effectively and efficiently manages your data to save time and resources and increase ROI -giving you peace of mind so that your team can focus on what’s most important.
To learn more about how CT Corporation can help you navigate your entity management needs, contact a CT Corporation specialist today.
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