When it comes to managing entities, especially multiple entities and especially across jurisdictional borders, it’s easy, but dangerous, to think in silos. When you take a single entity and think of it only in terms of the individual compliance needs one by one, you fail to see the bigger picture about the entity’s full compliance and where it falls in the grand scheme of things.
Likewise, outdated approaches to entity management may have worked well in the past, but new technologies and knowledge mean that there are now better ways to achieve the same goal – often more efficiently, with fewer resources, and in a safer, more accurate and more secure manner.
Rethinking your approach to entity management to take in the linear nature of the process, as well as the bigger picture and modern governance techniques, can help governance, compliance and legal operations teams to both streamline the compliance process and save time and other often-wasted resources.
If any of the following statements ring true for your organization, it’s time to rethink your approach to entity management.
You’re still working off of spreadsheets
Spreadsheets, and especially Microsoft Excel spreadsheets, have been the go-to for entity management since day one. It’s so easy to use and there are free templates online to get you started – why wouldn’t you default to this readily available, simple option? The problem is that spreadsheets can introduce errors into your entity management process that may not be caught in time, and may even cause a snowball effect that could result in compliance issues, fines and reputational damage.
Rethinking the spreadsheet and opting instead for entity management software could introduce more efficient processes, better task management, better security and better data handling, all while creating an all-in-one central repository for entity information.
You have decision-makers across multiple sites
It’s relatively straightforward in a small, single-site organization to keep track of your decision-makers. If someone moves on, then it’s likely the entity managers will know about it. But when your decision-makers are spread across multiple sites, either within the same city or across multiple countries and time zones, things get trickier. What happens if you need an urgent signature, but when you check who has power of attorney, you discover that everyone has defected to a competitor?
Rethinking your record-keeping to bring in more automated processes helps ensure your entity managers have the most up-to-date information on who’s got signing authority, and where they are located. When someone moves on, a single, simple entry in the database will ensure all records are updated automatically – there’s no need to remember exactly where that former director is considered a stakeholder.
Your entities are internationally based
Taking your organization global can be an exciting time – and a busy time, one in which your entity managers are trying to get used to new processes and requirements, new regulations and new compliance needs. Managing multiple entities spanning multiple jurisdictions can be an absolute headache, so it makes sense to have your approach to entity management be as streamlined and trouble-free as possible.
This is why keeping a manual approach to entity management can be a doomed tactic. By taking entity management to the cloud, you empower your stakeholders to interact via a central repository for the corporate record. You establish a single source of truth to negate the chance of multiple versions of a document making the rounds, and you help to ensure entity data is kept secure and safe from cyber threats.
Your governance process is not documented
Winging it or relying on Brenda in the Head Office for “how we do things” is perhaps the biggest threat to entity management – because cyber threats can be combated and processes can be improved, but if nothing is documented, then there is no backup in case the subject expert is suddenly no longer around. Policies and processes are an essential part of the corporate record, and should be stored securely with the rest of your organization’s entity data to ensure it’s accessible at any time, by anyone who needs it.
In this case, entity management software creates transparent documentation of your organization’s approach to entity management and governance. It’s a single source of truth for how you do things that isn’t just housed in Brenda’s brain.
Cybersecurity is an afterthought
So your approach to entity management was overhauled a few years ago and you bought a stack of SaaS platforms to bring your organization into the digital age? Great! How do they integrate? How secure is your data? How are you sending and sharing important, confidential documentation with your stakeholders?
The problem with technology is that there is so much out there, most of which can do the job pretty well. But without ensuring that those disparate systems can all talk to each other, and that no one outside the organization can access that data without your approval, then they are a threat to your business. Cybersecurity cannot be an afterthought in entity management because entity management involves intimate details of your operations, and you do not want those details getting into the wrong hands.
You can’t visualize the group structure
Being able to visualize the group structure might not seem like a big deal, but actually it can mean life or death for compliance teams. Some jurisdictions have strict ownership laws, while global regulation such as BEPS, FATCA and CRS/CbCR are demanding more and more transparency in group structures. If you can’t visualize your entity ownership structures, you risk falling into non-compliance.
Using entity management software brings the ability to create entity diagrams, helping compliance managers to create an organizational chart that can drill down into the minute details of each entity, which, in turn, sheds light on potential compliance issues before they become real problems.
Your entity managers only have space to be reactive
And, if all the above is happening in your organization, chances are your entity management team are running around all day just trying to keep up. Modern governance processes are designed to give governance, compliance and legal operations teams the space to breathe by automating repeatable processes and introducing a single source of truth for all entity data. Harnessing modern governance gives the entity management team the time and resources to take a more proactive approach to entity management, enabling more strategic thinking and better outcomes for the organization.
Entity management is a linear process better enabled by technology
Did any of the above send alarm bells ringing for you, dear entity manager? For all these reasons – and hundreds of others – it’s time to rethink your approach to entity management and introduce entity management software to your organization.
Entity management software, such as Diligent Entities, establishes a single source of truth and helps to streamline compliance operations. It can help organizations to centralize, manage and effectively structure their corporate record to improve entity management, which, in turn, can better ensure compliance, mitigate risk and improve decision-making.
By establishing a central repository to store entity data – and especially a highly secure, cloud-based repository – entity managers can bring in stakeholders as needed, getting the right information to the right people at the right time, and in the right format. No more missed filings or lost powers of attorney.
Diligent’s entity management software also integrates seamlessly with other governance platforms, including its board portal and secure messaging service, to create a secure governance cloud. This helps to drive better collaboration across the organization, provides real-time industry and company analytics, and ensures your most critical entity and subsidiary information is securely conveyed to those who need it.
Get in touch and schedule a demo to see how Diligent Entities can bring your approach to entity management into the 21st century, and help entity managers have room to think more strategically.