The rationale for software automation in Trust, Corporate and Fund Services

As part of the Future Focus Report 2023, we mapped out the industry’s first digitalisation pathway which guides firms on the direction of travel – and provides best practice - to help them leverage technology and transform their businesses. Click to read our previous blog defining the digitalisation pathway. 

One of the key stages on the digitalisation pathway is Automate and, in this blog, we examine in more detail the case for automation in the trust, corporate and fund services sector. And its role not only in increasing efficiencies and reducing costs, but also in improving customer satisfaction and the employee experience.

 So, what do we mean by automation? Well, for us the simplest, most relevant definition is:

 “Software to automate tasks within businesses and IT processes that emulate human interaction”

In other words, using technology to automatically replace what are currently costly, time-consuming and labour-intensive tasks to create better outcomes for both staff and customers.

The case for automation

McKinsey has conducted some very interesting research into this area which clearly shows that automation is now on the agenda. In a survey published in July 2022, McKinsey surveyed 639 participants across a wide range of industries, regions, company sizes and functional specialities and found that many firms believe it is possible to automate at least 25% of their organisations’ tasks over the next five years.

 However, less than 20% of organisations have already scaled automation technologies across multiple parts of their business, but more than two-thirds are currently running pilots. The sector leading the way in automation is financial services.

The reasons for automating were also interesting – rather than just reducing costs or increasing efficiencies, the top two reasons McKinsey identified were concerns about the effectiveness of an organisation’s business processes and the role automation plays in improving experiences for both customers and employees. The most commonly deployed automation technologies identified by McKinsey are as follows:

• Intelligent document management and processing
• Robotic process automation
• Business process or case management platforms

In addition, businesses are now starting to turn to “low code / no code” platforms and the use of chatbots and conversation agents is also on the rise.

 Automation in corporate, trust and fund services

In the Future Focus Report 2023, we surveyed how far firms had progressed along their digitalisation pathway and found, when it comes to automation, that 87% of firms in the corporate, trust and fund services sector have not fully automated manual data inputs, data checks and key workflow processes.

Three out of four firms say they could be better at increasing efficiencies and reducing costs, and only one in four respondents feel their firm is more profitable than their competitors.

Let’s be clear, automating processes is difficult and can present a wide array of challenges. The key to success is through making automation a key strategic pillar and that, in turn, might require re-thinking the organisation.

It’s important to recognise that automation is not solely an IT project as there are many stakeholders and actors in the business that need to be engaged. This is also key, because the challenge isn’t how to deploy automation technologies in the organisation but where to deploy it, meaning that it is crucial to identify where the opportunities exist for automation.

However, for those firms who make the commitment can certainly reap the rewards - for corporate services, trust and alternative fund administration providers, a number of opportunities exist.

Current manual data inputs and key workflow processes can be automated, as can cash postings and statement reconciliations, in addition to front office requests. RegTech can be adopted as ‘business as usual’ to automate regulatory filings such as tax returns, economic substance, FATCA and CRS.

By doing so, firms can improve data quality and reduce risk, reduce operating costs, and drive improvements in both customer satisfaction and the employee experience. 

To find out more, check out the Future Focus Report 2023,