A Common Standard Is Not the Same as Common Execution

ISO 20022 gives the financial industry a common language for corporate actions. But a common language only creates value when the market interprets it consistently, applies it in the same way and acts on it with confidence.

When a company announces a dividend, merger, stock split or other event affecting investors, that information must move through multiple organizations before it can be processed and shared. At every handoff, data may be reformatted, reinterpreted or reconciled. A small inconsistency at the source can become a significant operational issue downstream.

The challenge is not simply moving information faster. It is getting the information right before it starts moving. ISO 20022 is an important step forward. By providing a common structure for exchanging financial information, it can enable greater automation and support more timely, accurate data. But as I discussed with fellow panelists at Sibos 2026, a common standard does not automatically create a common understanding. We may be moving toward one language, but we are not yet speaking it with one voice.

 

Standardization Must Begin at the Source

For years, the industry has focused on improving downstream processing. That work remains important, but it addresses the symptoms more than the cause.

The largest opportunity is upstream, at the point where corporate action information is first created, validated and distributed. If information enters the ecosystem incomplete or ambiguous, every participant is forced to compensate. Firms compare sources, seek clarification, create exceptions and intervene manually.

We may be moving toward one language, but we are not yet speaking it with one voice.

ISO 20022 provides a richer and more structured way to exchange that information. But it cannot determine an issuer’s intent, supply a missing field or decide which of two conflicting announcements is authoritative.

Putting unclear information into a consistent format still leaves the industry with unclear information. This is the critical distinction between adopting a standard and achieving standardization.

 

The Cost of Standing Still Isn’t Static, It’s Growing

This is not an abstract data problem. It has a direct impact on operational risk, processing costs and ultimately reduces the amount of time investors have to make key decisions, which impacts investment returns.

DTCC supports corporate actions processing for ~1.5 million active securities. At that scale, fragmented data and manual intervention are not isolated inefficiencies. They will become a structural constraint on the market’s ability to operate at scale and support the growing demands of initiatives like extended trading hours or tokenization.

 

Technology Should Reduce Complexity, Not Recreate It

The same principle applies as the market adopts APIs, artificial intelligence (AI), distributed ledgers and tokenized assets.

New technology gives the industry an opportunity to redesign how information is recorded, validated and shared. It also creates a risk: if markets apply the same standards differently across platforms and networks, we will replicate today’s fragmentation in more advanced technology.

Tokenization does not eliminate the need for corporate actions. AI does not eliminate the need for authoritative information. APIs do not create consistency when the underlying data remains ambiguous.

As the industry modernizes, the practical test is straightforward: does it remove interpretation and reconciliation from the lifecycle or simply move them somewhere else? Passing that test will require standards to be applied consistently across technologies, networks and markets. At DTCC, this thinking is reflected in initiatives such as AnnounceDirect, which is designed to introduce more standardized announcement submissions, real-time validations and clearer visibility across the lifecycle. The objective is not simply to digitize an existing handoff. It is to improve the quality and structure of information entering the ecosystem.

 

AI Can Help, but It Cannot Fix the Source

AI can help organizations compare information, identify discrepancies, detect missing details and reduce manual work. What it will not do is act as a sophisticated solution to poor quality data. If an announcement is incomplete or ambiguous, AI may flag the issue faster, but it cannot always determine what the issuer intended. If used well, AI can augment human expertise to strengthen sound processes and help people make better-informed decisions not as a substitute for clear, consistent data.

AI should make a sound process more intelligent, not make a broken process move faster.

 

Adoption Follows Value

The biggest obstacle to alignment may not be ISO 20022 itself, but the vast coordinated change that is required to implement it consistently.

Issuers, agents, custodians, market infrastructure and technology providers, along with regulators, all see a different part of the lifecycle. Each of these groups also faces different challenges from an economic, systemic and prioritization perspective. While many see this as making alignment difficult, DTCC believes this makes it essential.

Organizations will not make significant changes simply because a standard is available. They need a clear value proposition: better information, fewer manual corrections, more consistent processing and lower risk. Adoption follows value. To build momentum, we must demonstrate how standardization solves real problems for the organizations being asked to embrace it.

The key here is that adoption is not the success outcome. Better execution is.

 

Back to SIBOS: Moving from Common Language to Common Execution

SIBOS reinforced, for me at least, that the industry broadly agrees on the target destination. The industry also agrees that, while every year has a call to action, this year feels different. Market participants are out of reasons to not act and are seeing the realization of the cost in standing still. Trusted, structured, actionable and authoritative data is a necessity to enable the markets and technologies that support it to reduce friction.

The hardest question to answer is how we get there.

History tells us that if the market doesn’t act, regulation will. While regulation can establish expectations, attempting to deliver the end-to-end alignment itself could prove problematic. Technology can enable change, but it alone cannot define the common operating model. Lasting progress, and navigation towards our common destination, will require industry participants to align on data, market practice, governance and measurable outcomes.

A shared standard gives us the foundation. Shared execution is what will deliver the value. 

DTCC has an important role. We sit between the organizations creating corporate action information and those that must process and act on it. That position gives us both an opportunity and a responsibility to help convene the industry, define what good looks like and turn standards into practical execution.

The future of corporate actions will not be defined by a single platform, standard or technology solution. It will be defined by whether the industry can pragmatically create an ecosystem where trusted data is democratized, quality preserved at source and delivered efficiently from issuer to investor.