Plenty has been said recently – even in these very pages – about the importance of entity management software to modern governance and compliance practice. This software can not only help to streamline legal operations within organizations both large and small, but it can also elevate practice to a new level, one built on strategic insights and better decision making.
The digitization of the governance world has led to increased efficiencies in-house and is helping to drive more and more organizations toward best-in-class practices. However, as one would expect, there is now a plethora of entity management solutions on the market, and that turns choosing the right entity management software into a bit of a minefield. What should you be looking for? And is it worth doing the research? This article aims to guide you in the right direction.
The benefits of using the right entity management software
First, let’s recap exactly why corporate secretaries and legal operations teams are moving increasingly toward digitizing processes and harnessing the power of entity management and board management technology.
Traditionally, entity management – the practice of managing and keeping your entities and wider group structures in compliance with international, federal, state and local requirements, and of managing the data, documents and communications related to that compliance – was handled manually. There were plenty of spreadsheets housing personal and organizational details, and filing cabinets full of sheets of paper detailing confidential corporate information. This was quite unwieldy until entity management technology allowed a much more streamlined practice.
However, there are still a lot of organizations that have yet to make the move to more digital compliance and governance practices. Those organizations are not only making the day-to-day work of their legal operations teams more difficult, but they are also lagging the best-in-class governance leaders.
The right entity management software can bring benefits to an organization that include:
- More efficient management of the whole entity life cycle
- Centralization of legal entity data into a single source of truth
- Harnessing automated workflows to increase productivity
- Enabling cross-department collaboration on compliance processes
- Simplified reporting using real-time entity data
- Heightened security for the corporate record
Without the right entity management software, organizations risk falling prey to some of the common pitfalls of governance and compliance, including:
- A lack of visibility over operations
- Information being hidden in silos
- Bottlenecks forming within compliance workflows
- The risk of human error being introduced with manual updating
- The challenges of reporting the right data on time to the right places
- An in-house compliance and governance practice that is not scalable
Choose entity management software by comparing the right aspects
It’s clear, then, that the right entity management software can bring enormous benefits to legal operations. But how do you know what’s the right software?
We’ve previously written about how to best approach entity management software comparisons, and our white paper provides an entity management software buyer’s guide to choosing the right entity management software.
To help you choose entity management software, our experts suggest you look at how the platform can help you to increase efficiencies, ensure compliance and mitigate risk. It’s also important that entity management software offers features such as:
- Robust data storage for legal entity data
- Effective management of entity data in a central repository
- The ability to clearly visualize corporate data to enable deep data analysis
- Simple and efficient data reporting, including the ability to facilitate electronic filings, corporate governance reporting, FATCA reporting and SMCR reporting
But that’s just the bare bones of what the entity management software should be able to do. To help you sift through the market’s offering and find the right entity management software for your needs, ask the various vendors the following questions.
Are there any integrations?
It’s easy to fall into the trap of technology silos, but that can be as dangerous for your compliance practices as siloed operations and departments that don’t talk to each other. The right entity management software will enable you to integrate systems to build a compliance and governance tech stack that enables seamless operations.
What’s the jurisdictional coverage?
Jurisdictions don’t just cross international borders; even operating in more than one US state can mean different regulatory and reporting requirements, which means the right entity management software will have a wide jurisdictional coverage for managing both local and international entities. Look for one with global coverage in aspects such as forms and e-filing – but more important, choose entity management software that allows all languages, including distinct alphabets (such as Cyrillic and Asian characters) and custom fields.
How simple will it be to run reports?
The range of reports you want to run could be as unique as your business, so the right entity management software won’t force you down a single reporting route. It also won’t make you wait hours for it to fetch data and produce a report. Choose entity management software that enables quick and easy reporting that uses custom fields to make it the right report for your unique needs. Also ensure the reporting output is flexible – that it’s not just offered as a PDF, but in formats that will let you interrogate the data further and make it strategically useful.
Will it allow organizational charting in a manageable way?
Like the reports you run, the organizational charts you create using entity data must be fit for purpose, too. The right entity management software will not just create a flat chart and be done with it; rather, it will use real-time entity data to create an organizational chart that links to further information and enables you to really drill down into that chart. Choose entity management software that has multiple options for organizational charting, and that has clear and easy-to-understand visualizations and formatting.
The right entity management software can transform compliance and governance operations
Diligent Entities can do all of this, and more. The platform boasts multiple integrations, including:
- CSC for registered agents
- DocuSign for eSignatures
- Diligent Boards to align the board portal and entity management system
- A secure file-sharing platform to allow stakeholders to access information securely online
- A Digital experience management feature that allows integration with other third parties, such as HR systems, so data can be shared even more widely
Get in touch and request a demo to see how Diligent Entities and the wider Governance Cloud could help to transform your compliance and governance operations, and drive business growth.