Banco Santander has completed a blockchain pilot that it says improves the process of proxy voting during annual general meetings (AGMs).
For the project, announced Thursday, Santander partnered with global fintech firm Broadridge and custodian banks JPMorgan and Northern Trust, describing it in a press release as the "first practical use of blockchain" for shareholder voting.
However, it should be noted that other entities such as Nasdaq, the Abu Dhabi Stock Exchange and a group of central securities depositories, including Russia's National Settlement Depository, have all conducted pilots, are developing systems or have launched platforms around the use case.
The Broadridge-built solution – piloted previously in April of last year – aims to improve transparency in the global proxy voting system, while also increasing security, efficiency, security and analytics, the release says.
The pilot was concluded on March 23 for the Spanish banking giant's AGM and saw participation from Santander’s blockchain lab and Corporate Services, which acted as the issuer’s agent. The blockchain solution was used to produce a "shadow" digital register of the proxy voting system taking place in parallel using the conventional voting model.
Sergio Gamez, global head of shareholders and investor relations at Santander, said that, for a listed company like Santander, the AGM is one of the most important corporate governance events.
Gamez explained:
As mentioned above, Broadridge executed a similar pilot focused on proxy voting in collaboration with the same partners last April. The project used a private version of the ethereum blockchain as a backup system to more traditional voting software. The trial was conducted at an annual meeting at Santander Investments.
"The successful completion of a second pilot along with the next phase of our blockchain-based proxy voting solution demonstrates Broadridge’s continued commitment to developing innovative technology solutions in the re-imagination and improvement of global proxy," said Patricia Rosch, president of investor communications at Broadridge.
Meeting image via Shutterstock