When unforeseen circumstances arise, boards and companies look to the general counsel (GC) to deliver guidance, options and peace of mind. For forward-looking GCs, these responsibilities extend well beyond immediate emergency response.
The COVID-19 crisis has catalyzed sweeping transformations in the business landscape. Companies have been pivoting their strategies to accommodate disrupted supply chains and new customer behaviors. At the same time, M&A activity is poised to surge, with one estimate predicting that more than a third of business owners in the developed world may put their companies on the market.
GCs, given their oversight of compliance and governance across a company’s jurisdictions, are in a strong position to provide strategic perspective. A GC with robust entity management software is even more well-equipped to advise about new risks, unforeseen costs, changes in regulations and unexpected opportunities. Entity management software strengthens the ability to see around corners and gets the right information to the right people at the right time, enabling executives and boards to make sharp, timely decisions when it matters most.
Strategy-minded GCs need to have entity management software, and its centralized recordkeeping abilities, at the top of their toolkits.
Entity Management Starts with a Single Source of Truth
Entity management software is grounded in a centralized corporate record: a single system that consolidates and stores all the forms, documents, data and information for a corporation’s subsidiaries and tax, legal, finance and compliance business units. This includes vital information like operating licenses, corporate registrations and signing authorities.
“Effective entity governance is a team sport. It’s the ability to understand what every team wants, so you can effectively create that single source of truth and everyone can grab the information they need to complete different business processes.”
–Samantha Wellington, SVP, Chief Legal Officer and Secretary with TriNet
Some GCs may think of a centralized corporate record primarily as a legal, administrative and governance tool, but its power for strategy cannot be understated. Particularly when departments record and access information through entity management software, a centralized record ensures that everyone is “drinking from the same well.” Such a single source of truth delivers several benefits: It builds trust in data, increases the accuracy, speed, and simplicity of managing information, and makes processes more efficient.
Keeping Decisions and Deals Moving, Even in Chaotic Times
With a single source of truth, GCs, departments, and boards are able to conduct activities like due diligence and post-merger integration with less friction and greater efficiency.
Consider, for example, that a corporate secretary must manage 100 or more unique data points for every entity in a corporation, and a corporation’s entities can number into the hundreds or thousands. Collecting and managing all of these data points manually, across siloed departments, is cumbersome. With entire workforces coordinating remotely, having that single, reliable source of truth becomes even more critical. A centralized corporate record accelerates access, reduces the back-and-forth of questions and clarifications, frees up staff time for more value-added activities, and keeps deals moving.
“[With a single source of truth] you only have to deal with data once instead of multiple times. You’re just using your time in a more optimal way that enables you to cast your attention to higher-value elements.”
-Samantha Wellington, SVP, Chief Legal Officer and Secretary with TriNet
Agility in Action
GCs may not have been thinking about their corporate record when working on applications for federal loans or stimulus packages. However, the COVID-19 stimulus programs offered earlier this year in the United States illustrate the benefits of a single source of truth and systems for administrating this data. Complex loan applications on tight deadlines made for a competitive bidding process. Companies with the right data at their fingertips emerged as winners.
With that single source of truth in place, “You could have submitted your [Paycheck Protection Program loan] application on a Saturday as opposed to sorting through a bunch of different records,” said Wellington.
Now imagine such agility at work for strategic growth: facilitating licensing, registration, due diligence, and more for M&A activities and market expansion.
The Power of Entity Management Software
Entity management software such as Diligent Entities turns a centralized corporate record into a strategic asset. Entity management software is equipped with time-saving features like templates and other reusable assets, e-filing, reports that autofill, automated document verification, and compliance calendars with alerts.
Strategic growth, even absent a pandemic, requires enormous amounts of data collection and management. Entity management software helps by:
- Automating workflows for cumbersome tasks like document verification
- Eliminating redundancies
- Keeping teams on top of important application and regulatory deadlines
- Delivering answers to commonly asked questions, freeing up the legal time for higher-level tasks and opportunities
Over time, an entity management solution enables a GC and legal department to:
- Standardize data collection and reporting
- Complete applications and reporting faster and more accurately, with less stress
- Reduce manual labor and cycle time
- Fuel good governance practices across jurisdictions and business units
In times of calm, implementing a centralized corporate record and entity management software may not seem like a priority. However, GCs may feel the absence of both when market conditions demand flexibility, agility and proactive decision-making.
The right entity management solution gives a GC and legal department access entity information, documents, and data from a single, secure place, with the ability to manage its ongoing accuracy. This single source of truth, supported by a robust array of features, supports GCs in their role to deliver the right information to the right people at the right time. GCs and the companies they serve are then well-positioned for due diligence, entity integration, company expansion, and more—through the current business environment and beyond.
A single source of truth is critical to any strategic growth initiative. See why in our free white paper, “Driving Strategic Growth with a Centralized Corporate Record.”