By Staff Reporter
SWIFT will pilot a digitized shareholder voting platform based on distributed ledger, or blockchain, technology, in partnership with Deutsche Bank, DBS, HSBC and Standard Chartered Bank in the first half of 2019, according to a press release.
SWIFT will jointly conduct the proof-of-concept (POC) in the Asia Pacific region, with leading securities software provider SLIB and the Singapore Exchange (SGX), along with Deutsche Bank, DBS, HSBC, and Standard Chartered Bank.
“The expression of shareholders’ rights is often limited today by non-transparent, complex and inefficient paper-based processes,” said Lisa O’Connor, managing director, Securities, Treasury & Standards, Asia Pacific at SWIFT. “The emergence of blockchain technology is a new opportunity to look at improving these processes.”
Proxy voting in particular often results in avoidable complexity and errors that could be eliminated through greater transparency and automation, the statement said.
SWIFT will facilitate the PoC in its blockchain sandbox testing environment with Deutsche Bank, HSBC and Standard Chartered Bank joining as participants, while DBS and SGX join as both participants and issuers.
The participants will reuse the SWIFT network and their existing SWIFT infrastructure and interfaces to access, test and validate the applicability of DLT.
The PoC is designed to:
- Test the deployment of a voting solution in collaboration with issuers and a Central Securities Depository (CSD), where the information is stored and managed on a “permissioned” or private blockchain (as distinct from public blockchain).
- Demonstrate the viability of hybrid solutions based on ISO 20022, combining messaging and DLT to foster interoperability and avoid market fragmentation.
- Test SWIFT’s capacity to host third-party applications in its sandbox and reuse its security and interface stack.
- Confirm the use of ISO 20022 as the foundation for standardizing for Application Programming Interfaces (APIs) that expose DLT node contents to parties with direct access to the ledger.
The Society for Worldwide Interbank Financial Telecommunication (SWIFT) provides a network that enables financial institutions worldwide to send and receive information about financial transactions in a secure, standardized and reliable environment. It provides global banks with Business Identifier Codes, popularly known as SWIFT codes.