South Africa’s central securities depository (CSD) will deploy blockchain technology developed by Nasdaq to bring electronic proxy voting to its capital markets.
The solution, based on a proof of concept developed for Nasdaq’s Estonian market, will allow Strate CSD to provide general meeting services and give shareholders a secure tool for voting remotely.
“The environment at the moment is very administratively intensive, which means there are many inefficiencies and risks associated with it. This is not ideal in today’s electronic age, as technology like blockchain can serve as a solution,” said Tanya Knowles, managing executive of Fractal Solutions, a division of Strate.
Knowles added the solution is aimed to service the needs of transfer secretaries, issuers, custodians and asset managers.
“Given that it is an end-to-end solution – from the time a meeting is announced and all the way through the voting process to the publishing of results – it means that all stakeholders will truly benefit within the process,” she said.
The benefit this will have for CSDs and other market infrastructures include reduced complexity through end-to-end general meeting administration in a single solution, and enhanced insight through real-time data access to securities holders.
The release of the solution follows an announcement by the CSD Working Group that an e-proxy voting system through blockchain technology could go live soon.
The CSD Working Group, comprising of representatives from Clearstream, Strate, Nasdaq, NSD and Swift, explained a DLT-based product using ISO 20022 standards could easily be adopted for e-proxy voting.
By leveraging blockchain, we are able to reduce friction in the voting and proxy assignment process and also ensure that all information is transparent to stakeholders when required and with the proper security, governance and risk procedures in place,” said Lars Ottersgård, head of market technology, Nasdaq.