From Corporate Access to Direct Access: The Implications of MiFID II on Corporate Access

by John Dwyer, January 30, 2017
Industry Trends
Global, EMEA

Abstract

Much of the focus of MiFID II has been on research unbundling, with corporate access overlooked. There are major pain points in the corporate/buy side dialogue around trust, data, and connectivity.

Celent has released a new report titled From Corporate Access to Direct Access: The Implications of MiFID II on Corporate Access​​​​​​​​​. The report was written by John Dwyer, a Senior Analyst with Celent’s Securities & Investments practice.

Much of the focus of MiFID II has been on research unbundling, with corporate access overlooked. There are major pain points in the corporate/buy side dialogue around trust, data, and connectivity which can be addressed through technology. 2017 is likely to see further evidence of buy side and corporates embracing technology-led change.

Corporate access is a core element of the capital allocation process and a highly competitive area for investment banks and brokers. The FCA’s guidance indicates the need for a formalized, technology-based solution with transparency, new operating procedures, granular recordkeeping, and pricing. Irrespective of regulatory changes, trust between the buy side and the sell side is a major issue impeding dialogue with corporates. Furthermore, data usage and connectivity needs a technology-driven upgrade. Various technology vendors have emerged. ingage has attracted an impressive buy side and corporate client list who advocate the platform’s ability to solve key pain points in the corporate access process.

“When regulatory change and technology meet a process, such as corporate access, which has friction and fundamental pain points, then business models and operational practices will transform,” commented Dwyer.

“Corporate access has the potential to morph into something direct in nature and thus be characterized by much improved flow of information, data, communication, capital, and alpha. Given this potential the buy side, sell side, and corporate constituencies should get on board,” he added.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

 

The Implications of MiFID II on Corporate Access

1

 

Pain Points

1

 

New Corporate Access Platforms Already Emerging

2

 

Institutional Investor Perspectives

2

 

Active Two-Way Dialogue

2

 

Implications for Buy Side and Sell Side

3

 

Key Research Questions

3

Introduction

4

 

Fundamental to Capital Allocation

4

Motivations for Corporate Access

6

 

MiFID II Perspectives

7

 

Key Takeaways

7

 

Additional Regulatory Perspectives

9

The Pain Points in Corporate Access

11

 

Trust

12

 

Data

12

 

Connectivity

13

 

New Corporate Access Platforms

15

Company in Focus — ingage

16

 

Client Base Testimony

18

 

Institutional Insight

18

Active Two-Way Dialogue

19

Technology Driving a Cultural Shift

20

 

Deal or No Deal

20

Conclusion

22

Leveraging Celent’s Expertise

23

 

Support for Financial Institutions

23

 

Support for Vendors

23

Related Celent Research

24

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