Equiniti ezine | May 2012

EZINE > may 2012 inside this issue: Cracking the code for success Peter Swabey picks out some topical issues to keep an eye on Outstanding feedback for Contact Centre How Equiniti is setting the standard for best practice Equiniti Business Performance Follow our progress Employee ownership takes centre stage Momentum building in Europe Read all about it Get your copy of the ICSA Company Secretary's Handbook

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frc consultations

Hot on the heels of a series of consultation launches by the FRC, Peter Swabey, Company Secretary, Equiniti, gives the lowdown on what company secretaries need to be aware of

Cracking the code for success April marked the launch of Financial Reporting Council (FRC) consultations on revisions to the UK Corporate Governance Code and accompanying Guidance on Audit Committees, and to the UK Stewardship Code. The proposals incorporate measures previously outlined by the FRC in its paper 'Effective Company Stewardship - Next Steps', published last year.

With the 13 July response deadline looming ever closer, it’s time to take a look at some of the major potential changes.

Corporate Governance Code

As the Code prepares to mark its 20th anniversary, significant alterations are on the horizon. These include a proposal that FTSE350 companies put the external audit contract out to tender at least every ten years. The FRC is also proposing that boards include a section in the annual report explaining why they believe

that the annual report gives a fair and balanced view of the company’s performance.

Concern has been expressed by a number of commentators about the quality of explanations where a company chooses not to apply the Code. This is important because

it fundamentally underpins the UK corporate governance model, in contrast with the ‘rules based’ approach of some other countries.

For instance, where the Code provides that a director cannot be on a board for more than ten years, but the board believes that continued on page 3

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frc consultations it is in the interests of the company and it’s shareholders not to comply with this provision, this is fine, provided that this divergence is properly explained. This could be by providing evidence that the individual concerned still makes a valuable contribution. Alternatively, if there has been a lot of change, the case could be made that, in a specific case, it is more appropriate to retain experience on the board than comply with the rule.

UK Stewardship Code

Proposed changes to this Code, first published in 2010, could see more clarification on exactly what stewardship means i.e. what are the responsibilities of the asset owners and those who manage the assets on their behalf? Potential exists for conflicting interests between asset owners and managers, so the new rules would ask investors to disclose their policies on activities, such as the use of voting advisers and stock lending.

As the recipients of shareholder votes, Equiniti sees that some institutional investors are better than others at voting, at getting their votes in and at engaging with companies. We often hear of investors who rely on third party advice on how to vote, so establishing what

exactly the responsibilities are, and who is responsible for engagement between the issuer and the investor, can only be a positive step.

Don’t miss your opportunity to have your say on the proposed changes. Revised versions of the codes are due to apply to reporting periods beginning on or after 1 October 2012.

Watch this space for further updates.

BACS £20m cap

In our May ezine, we reported that we were seeking agreement at an industry level from BACS, the Bank of England and the banks to the deferment of the implementation of the proposed maximum limit of £20 million to be applied to any individual payment included in a file of payments, such as a dividend payment file, processed through the BACS system with effect from 31 May 2012. This would require clerical intervention with our system generated files, creating significant risk.

We are pleased to report that we have been successful in our lobbying efforts and have obtained confirmation from BACS that this limit will now not be applied for Equiniti’s Registrar payments until October in order to give the various payment services time to develop automated solutions for our use.

For more information For further information, please contact Peter Swabey at Peter.Swabey@Equiniti.com or your Relationship Manager client feedback > on page 4

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client feedback

With complaint levels of just 0.02% across all transactions, Equiniti is setting the standard for Contact Centre best practice

Outstanding feedback for Contact Centre Equiniti’s Contact Centre, run on behalf of its share registration, investor services and employee share plan clients, continues to show outstanding service levels, according to the latest analysis of caller feedback.

During the first quarter of 2012, Equiniti handled a total of 545,700 calls – a 17% increase on the last quarter of 2011.

Complaints against all our transactions continued to slide to a miniscule 0.02%.

“If we are dealing with two and a half million calls a year and our level of complaints is that low, it’s clear that the quality of service we are providing for our clients is very high,” says Sam Halford, Director of Operations.

“We ask callers how they rate us by asking three simple questions at the end of the call,” adds Sam. “More than 90% say that we run a very good service, which is

an exceptionally high score. We also receive NPS* scoring, which is very positive, but my view is that having the questions answered when the call is still fresh in their mind generates the most accurate feedback.”

Sam attributes much of the success to the development of a dedicated management team with a firm focus on delivering a quality customer focussed service that continuously meets client KPIs and SLAs. Equiniti has also invested significantly in training and retraining the teams in both the Birmingham Contact Centre and Worthing back office teams.

“That investment in people is very important because it means we have a lower attrition rate, which in turn encourages a higher quality of service,” says Sam. “We continue to meet our client SLAs. For instance, we answer 80% of calls within 20 seconds – that’s a target we consistently deliver against.”

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client feedback

We ask callers how they rate us by asking three simple questions at the end of the call,” adds Sam. “More than 90% say that we run a very good service, which is an exceptionally high score.

Another priority for Equiniti has been to simplify and speed up the way that some caller information is processed. “In years gone by, if a caller wanted to, for instance, supply a change of address or bank account details, it had to go through a back-office process,” says Sam. “Now we promote a ‘first touch’ approach and do things like that, there and then, on the phone. This is something we’re developing all the time and it is clear that this is what customers like.

“We also ensure that staff from Worthing and Birmingham come together regularly to investigate areas where we can learn from

each other and improve our service. However hard you work, there are always things that you can improve. External accreditation is very useful for this and for the second year in a row we have been awarded the CCA** Global Standard for our operation.

We have quality champions in all our operational areas who play a crucial role by investigating any problems that may be encountered and then drawing up corrective action plans to solve them – plans that are then implemented across the company. There is always something that you can do even better.” *NPS is Net Promoter Score – an independent management tool used to gauge the loyalty of customer relationships. **Customer Contact Association

For more information Please contact your Relationship Manager Dashboard > on page 6

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Dashboard

We are pleased to report that we continue to provide a high standard of performance and quality, improving year on year.

Equiniti Business Performance In the information over these two pages we give details of our Contact Centre Service Levels, Transaction Processing Service Levels, Customer Complaint Quarterly Trends and Equiniti Developments.

Contact Centre Service Level Standards – Quarterly Trends The Equiniti Contact Centre achieved an overall grade of service of 89% against a service level target of 80%.

98.8% of all calls presented were answered. A total of 545,700 calls were handled. The total number of calls answered during quarter one was up by 17% compared to quarter 4 of 2011.

The Contact Centre is working very closely with other operational areas to ascertain what further processes can be introduced as a “one hit process” over the telephone, further improving the service that we offer to Shareholders and their representatives.

As always the primary focus remains on quality. Spot checking the agents and then feeding back the results is a necessity for continuous improvements to be effective and for complaints levels to be kept to a minimum.

Quarterly % Total Calls Answered

Average Monthly Volumes of Calls Received

Service Standard

% 100

250k

98

230k

96

210k

94

190k

92

170k

90 Q1 10

150k Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Q4 11

Q1 12

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Dashboard Transaction Processing Service Level Standards – Quarterly Trends Service level performance was maintained at 99.8% for Q1 and continues the strong trend seen throughout 2010 & 2011.

As predicted volumes for the period increased significantly due to the start of key client activity, such as the proxy/AGM season.

Volumes are up when compared to the same period last year and this is due to a number of tasks starting earlier in the year.

Additional resource and significant multi-skill training was undertaken to ensure service performance remained strong.

Quarterly Average Service %

Quarterly Average Volumes processed

Service Standard

% 100

1,400,000

98

1,200,000

96

1,000,000

94

800,000

92

600,000

90

400,000 Q1 10

Customer Complaint Quarterly Trends 2012 has seen an excellent start, with incoming complaint levels continuing to fall against the levels of transactions, which now stands below 0.02%. Compared to Q1 2011, incoming complaints are lower by 13% and the number considered as justified represents only 31% – this is 37% lower than Q1 2011.

In addition to this, complaints related to regulated products have continued to fall and there has been a 30% reduction on cases referred to the FOS in Q1 2012, compared to Q1 2011. This highlights the excellent quality of complaint management and our ability to resolve a complaint once fully investigated by our team of experienced and dedicated complaint handlers.

These trends demonstrate the sustainable effectiveness of quality improvements delivered throughout 2011 and the on-going focus of quality by all operational processing areas and their respective Quality Champions, to ensure an excellent customer experience.

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Q4 11

Q1 12

Quarterly Average Service % % 0.05 0.04 0.03 0.02 0.01 0

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Q4 11

Q1 12

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Dashboard Equiniti Developments Q1-Q2 2012

Employee Share Plans

■■ ESP

Portal migration roll out in full flow.

Response from clients and participants very positive.

■■ SIP

real time dealing now fully operational in ESP Portal and clients being migrated throughout the rest of this year.

General

■■ Shareview

electronic queries was successfully launched. This new service enables shareholders to post structured queries via Shareview for response via e-mail or nominated channel.

■■ Dividend Planning team are working closely with the Bank Of England and BACS to 'solutionise' the proposed £20m individual payment BACS cap limit.

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Employee share ownership

A proposal to the European Parliament aims to promote employee ownership of shares across EU member states

Employee ownership takes centre stage Moves are progressing to create Employee Ownership Centres within each member state of the EU. The centres will provide information, education, training and advice to employees, businesses and the public at large. Their aim is to promote employee ownership and advise countries on implementing appropriate legislation.

The European Economic and Social Committee (EESC), a consultative assembly of employers, trade unions and representatives of various other interests, is requesting a designated budget from the European Parliament to set up the centres.

Earlier this Spring, the EFES (European Federation of Employee Share Ownership, of which Equiniti is a member) presented a budget proposal to the European Parliament for 造2.5m to fund the initiative. The EFES has asked that anyone who agrees with this budget proposal should lobby their MEP to provide support. The full report of the public hearing is available for download here.

For more information Please contact your Relationship Manager douglas armour > on page 10

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Douglas Armour

The latest edition of the Company Secretary’s Handbook is essential reading

Read all about it The new edition of The ICSA Company Secretary’s Handbook, by Douglas Armour, Managing Director, David Venus & Co Ltd, available in print and e-book formats, is a practical guide to the legislation and regulation governing companies and company secretarial procedures. Coverage is comprehensive and details the procedures associated with boards of directors, company meetings, reporting, shares, and share registration. The handbook also contains

Coverage is comprehensive and details the procedures associated with boards of directors, company meetings, reporting, shares, and share registration.

chapters on listed company compliance, corporate governance, company investigations, takeovers and mergers, and insolvency.

Detailed commentary is accompanied by more than 80 precedents, appendices and a glossary of key terms, plus a directory of key company secretarial resources.

The new edition includes significant updates to the chapters on Corporate Compliance, the Listing Regime, and Corporate Governance to bring the text completely up to date. The structure of the contents has also been completely updated to sequentially reflect the order and layout of the Companies Act 2006.

In addition, the handbook contains a CD-ROM of customisable precedents, as well as key reference material including links to Companies House forms, Model Articles, and core governance codes.

To order your copy Visit www.icsabookshop.co.uk