Lack of regular communication and last-minute requests for information are the biggest frustrations for firms when outsourcing their entity management obligations according to new research* from Ocorian, a global market leader in corporate services.
Companies looking to switch can now download Ocorian’s new guide entitled, ‘A complete guide to switching your corporate services provider’, to help them decide when and why to switch - and then how to do it with ease.
Ocorian’s study found 62% say poor communication is their biggest frustration, while the same number highlight frequent last-minute requests for information as a key grievance.
51% not confident their service provider is keeping up to date with compliance and reporting
Worryingly, the research with firms based mainly in the UK but also in Switzerland, Sweden, the Netherlands, Germany, France, Italy and Denmark found more than half (51%) are not confident their service provider is keeping up to date with compliance and reporting requirements.
Ocorian, which supports 15,000-plus corporate entities across its global network, questioned 100 company secretaries, general counsels and senior tax and corporate lawyers working for companies with combined revenues of more than £45.8 billion.
26% plan to change providers in next 18 months
It found more than a quarter (26%) plan to change providers in the next 18 months with 13% bringing the work back inhouse and 11% moving to another corporate services provider while 2% aim to bring in additional support.
When considering switching service providers, nearly two-thirds (64%) cite the poor quality of data and reporting from their existing provider being the main driver for change. More than half (54%) say service levels are the issue and 48% plan to switch as a result of technology problems. Two out of three (67%) of firms review suppliers annually while 33% do so every two to three years.
Corporates need to rely on service providers to make life easy for them
The research, however, found some reluctance to switch. The biggest concern about switching identified is the lengthy due diligence process involved in appointing a new provider with 81% concerned about onboarding a new supplier. Around 56% are concerned about the amount of work involved in a transfer while 42% are concerned about the reaction from the incumbent.
Jason Gerlis, Global Head of Corporate Services at Ocorian said: “Corporates need to be able to rely on outsourced providers who make life easy with regular communication and with work completed on time.
“If companies cannot rely on partners to be up to date with compliance and reporting regulations there are risks to their business and it makes sense to switch. It may seem easier to stick with a current provider, but the cost of not switching when you have concerns could cause bigger issues for your business down the line.”
How Ocorian can make life easy for you
Ocorian provides entity management, fiduciary and corporate administration to thousands of businesses around the world offering a broad range of corporate services to establish, administer and give substance to a wide range of legal structures across sectors including telecommunications, energy, manufacturing, aviation and shipping.
Its company incorporation specialists are commonly involved in the set up and ongoing administration of corporate structures and SPVs for M&A, private equity investment, asset housing, restructures, real estate, international expansion, funds and debt listing purposes.
Ocorian also provides a range of ancillary services including corporate administration, statutory compliance, board meeting support and local resident director services. Its global network means local experts have in-depth knowledge of the regulatory requirements in different jurisdictions ensuring the establishment of entities complies with all local laws.
* Ocorian commissioned independent research company PureProfile to interview 100 company secretaries, general counsels and senior tax and corporate lawyers working for FTSE 250 or FTSE 350 companies and private companies with annual revenues of between £10 million and £1 billion during June 2023. Senior executives interviewed work in the UK, Switzerland, Sweden, the Netherlands, Germany, France, Italy and Denmark in the energy, mining, retail, real estate, transport and manufacturing sectors and currently use third-party corporate services provider for some or all of their entity management obligations.