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Asset managers recognized for innovation

The emphasis on disruptive technology in asset management is well-reflected by the winners of this year's NICSA NOVA awards, recognizing standout firms and individuals in the industry.

"Business leaders now understand how important technology deployment is and how impactful it can be in reshaping their firms as the industry and business models evolve," says Jim Fitzpatrick, president of NICSA.

Five firms were recognized by the organization for products that help transform operations, from streamlining communication between funds and broker-dealers, to modernizing quality control processes and helping asset management companies comply with significant SEC rule changes.

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"We're really excited by the capabilities surrounding machine learning," notes Karen Walsh, head of the retail service center at Putnam Investments, which was awarded for its quality control platform, Q-Boost.

The platform uses a series of algorithms to predict likely process errors based on historical data.

Christian Webster, vice president of Capital Group's American Funds, an honoree for its new account management servicing application, ACE, says the firm is looking to launch more tools that incorporate robotics and automation, both key industry trends to watch.

"We plan to bring forth an array of compelling and timely discussions," says NICSA President Jim Fitzpatrick.

Innovation should not happen just for innovation's sake, notes Anna Jamroz, senior vice president, Global Fund Services, at Northern Trust, and one of the recipients of this year's emerging leader awards.

"Innovation should lead to more loyal clients and improved financial outcomes," she says. "Otherwise, it's a distraction from our mission."

Robert Conti, managing director at Neuberger Berman, and winner of this year's strategic leadership award, expands on that sentiment, focusing on reducing complexities for clients.

"We need to continue to improve education to the investors, and make information easy to access and understand," he says. "We need to make things simple and user-friendly. That would be innovation with a purpose."

Keith Slattery, managing director and head of funds services operations at JPMorgan Chase, who won a president's award for service to NICSA, says, "The greatest opportunity for innovation in our industry is to solve problems collectively by creating industry-wide capabilities which improve standardization and lower the cost of services to all our clients and investors."

Jamroz, Conti and Slattery are three of eight individuals in asset management who received a 2018 NOVA award for leadership, service and lifetime achievement.

All nominees for a lifetime achievement award must have at least 25 years of experience in asset management. This year's winner in that category is Jeffrey Paul Beale, former CAO and vice president at Eaton Vance.

The awards will be presented at the General Membership Meeting, which takes place in Boston on Oct. 11-12.

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Jeffrey Paul Beale, former CAO and vice president, Eaton Vance
Fund Industry Lifetime Achievement Award
Following 25 years with Eaton Vance, Jeffrey Beale, the firm's former chief administrative officer and vice president, can safely say he left the asset management industry on a high note as well as his mark on the surrounding Boston community.

"Over his more than 25 years with the company, Jeff Beale has demonstrated outstanding commitment to our clients, staff members and business partners, and has worked tirelessly to ensure that Eaton Vance maintains an exemplary service record and corporate culture," Thomas E. Faust Jr., chairman and CEO at Eaton Vance said in a statement at the time of Beale's departure.

After joining the firm in 1992, Beale quickly ascended to various executive roles at the firm.
Beale took the position of vice president of Eaton Vance in 1998 and chief administrative officer the following year, according to the firm.

In those positions, Beale oversaw Eaton Vance's information technology, operations, mutual fund and dealer services, fund administration, human resources and facilities management services.

"Jeff represents the very best of the asset management industry," says Jim Fitzpatrick, president of NICSA. "He has served the industry and Eaton Vance with distinction, and has been a terrific role model."

Since retiring from Eaton Vance on May 1, Beale spends his time giving back to the Boston community, serving on various nonprofit boards.

Beale is a member of the board of trustees for the Boston-based Dana-Farber Cancer Institute, where he has served since February, according to Bloomberg News.

In addition, Beale is the president of the board of directors of the First Literacy Boston, a nonprofit dedicated to improving literacy rates among adults with limited English proficiency. He also sits on the board of directors at A Better City, a Boston-based nonprofit aimed at improving the region's economic health, competitiveness, vibrancy, sustainability and quality of life.

"He has been a longtime advocate for both NICSA and supporting the industry through collaboration and sharing of best practices," Fitzpatrick says. "He is a true leader in our industry."

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Stacy Bernstein, American Century Funds
President’s Award for Service to NICSA
Stacy Bernstein, head of financial intermediaries at American Century Investments, is responsible for building and managing strategic partnerships for the firm's financial intermediary relationships. When considering what it takes for success, she says the key is building more than the typical business relationship.

It's about "creating an intimate and customized client experience through technology and compliance enablement," Bernstein says.

Prior to American Century, Bernstein was a managing director at Legg Mason for nearly a decade. There, she was responsible for developing home office relationships. She also has prior experience as a director at Salomon Brothers Asset Management and as senior vice president at Liberty Funds, according to her LinkedIn account.

So far in her career, Bernstein says she is most proud of "building strong distribution partner relationships that have turned into friendships." After learning of the recognition from NICSA, Bernstein says she is "deeply honored."

She adds, "I strongly believe in the mission of NICSA, and it has been my pleasure and privilege to help our industry better serve clients."

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Keith Slattery, JPMorgan Chase
President’s Award for Service to NICSA
As managing director and head of fund services operations at JPMorgan Chase, Keith Slattery has a keen focus on the regulatory impact on technology, operations and service delivery.

"Our industry is constantly evolving," he says. "We must respond to waves of regulatory changes, product innovation and technology enhancements. Service providers in our industry will create competitive advantage by providing fast, effective responses to these forces of change."

Throughout his career, Slattery has taken lessons from his various roles. When Touche Ross and Deloitte merged, he joined a team specializing in audit and tax services for investment companies, "which taught me the value of specialization and the importance of developing deep, technical expertise." At State Street, he "helped integrate the U.S. fund administration business acquired from Investors Bank & Trust."

It has been 30 years since Slattery attended his first NICSA meeting; he is now a member of the board. This year he will co-chair the annual meeting. "I am excited about the direction NICSA is taking to strengthen and broaden membership, constantly improving support for the asset management community," he says.

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Victoria McGowan, BNY Mellon
NOVA Strategic Leadership Award
As head of global fund administration at BNY Mellon's client service delivery organization, Victoria McGowan has had a hand in innovation for both product development and technology strategies. Although she is in charge of financial reporting, tax services, regulatory administration and compliance services at the firm, McGowan knows she can't do it alone.

"Finding out about this award was enormously gratifying for me," McGowan says. "It's a testament to the amazing talent in my team."

While at the firm, McGowan built a team of industry experts with the mission of bringing new products to market that meet the growing needs of its clients.

Peter Johnston, global head of client service delivery at the firm, says, "Under her leadership, we have transformed the reporting process for clients and built a cutting-edge product that meets new requirements."

Ann Fogarty, head of global fund accounting and administration, adds, "She is a visionary with a strong understanding of the impact that technology has on the fund administration servicing business."

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Robert Conti, Neuberger Berman
NOVA Strategic Leadership Award
Reflecting on a career with Neuberger Berman that began in 1980, Robert Conti says the frenzied days following the bankruptcy of parent company Lehman Brothers stand out the most.

"We had to show shareholders stability and plans for the future," he says. "We faced so many issues - intermediary relationships, getting our investors to approve our advisory agreements due to the change of control hurdles, crazy markets and more — and all at once. It was the biggest challenge of my career."

Conti recently announced his retirement, but he remains for now as a managing director at the firm. The recognition from NICSA, he says, "means so much to me, because nominations come up from the people working in the trenches."

One of the key challenges Conti sees for the industry in the years ahead is simplifying the client experience as markets and offerings become increasingly complex.

"This is how NICSA comes in," he says, "helping in these efforts to inform clients."

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Jonathan Rizzo, Deloitte
NOVA Award for Emerging Leaders
After more than 14 years as a risk advisory specialist within Deloitte's advisory practice, Jonathan Rizzo says his chief accomplishments have centered on helping his investment management clients tackle complex challenges. These challenges, he adds, include strategic and operational risk issues, third-party and service provider oversight requirements and controls over financial reporting.

In 2016, Rizzo, received the firm's Dennis Wasniewski Award, an annual recognition of senior managers who demonstrate a strong dedication to teamwork and their colleagues.

Rizzo sees the development of communication and data-sharing methods as a key industry innovation aim. "Data is the fuel organizations require to operate," he says. "Investment management companies will need evolved, effective means of gathering, characterizing, protecting and sharing this valuable asset amongst clients, counterparties and other third parties."

Blockchain and other alternate data and information-sharing networks, he predicts, will gain significant traction in the industry within the next five to seven years.

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Kelly Cornwell, Vanguard
NOVA Award for Emerging Leaders
In her more than 15 years with Vanguard, Kelly Cornwell has held roles in brokerage operations, client services and mutual fund operations. Her current focus as financial advisor services manager is on developing and maintaining industry relationships, and managing the DTCC engagement within Vanguard's financial advisor services business.

Cornwell has had significant experience with the transfer process from both the broker-dealer and fund company side. She serves as vice president of the SIFMA Customer Account Transfers Board, and leads the SIFMA/ICI joint task force on mutual fund transfer. The task force, she says, "has implemented changes that, from 2013 to 2017, reduced the industry reject rate specific to mutual fund transfers from 16.3% to 8.8%."

As settlements occur at an ever faster rate, Cornwell says, client expectations are rising. The ultimate goal should be real-time processing, she adds, to meet these expectations and reduce risk.

About the award, she says, "I am excited to have the opportunity to represent Vanguard while working to improve the experience for both Vanguard investors and shareholders across the industry."

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Anna Jamroz, Northern Trust
NOVA Award for Emerging Leaders
After just one year at Northern Trust, Anna Jamroz was sent to London, where she supported the conversion of Baring Asset Management's financial services group onto the Northern Trust platform. Now, as senior vice president of global services, her focus is on building out Northern Trust's West Coast presence.

"I am especially proud of the size and scope of our West Coast client base, and grateful for the support and commitment of my Chicago partners," she says. "Their willingness to fly cross country and support our efforts is the reason our institutional brand is now so strong on the West Coast."

Ensuring that service and quality go hand in hand with technology shifts is a crucial goal in asset management, she says. Thus, innovation should lead to improved financial outcomes and increased client loyalty.

"Whether we are talking about automation or data optimization, the key is value creation," she says.

Looking ahead, she says, "I'm ... excited for the potential of a new generation to tackle the challenges that our industry faces in meeting the needs of investors, and perhaps improving the public perception of finance as a whole."

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Envision Financial, FundKeeper
NOVA Industry Innovation Award
A key focus for asset management technology is simplifying processes through automation and providing multiple services from a single platform.

Envision Financial Systems, a Costa-Mesa, California-based technology firm that services the asset management industry, partnered with U.S. Bank Global Fund Services to create a mutual fund platform that does just that. FundKeeper, according to the firm, "consolidates existing direct-at-fund accounts onto a single platform, which is branded for the broker-dealer."

This means intermediaries no longer have to hold accounts directly with mutual fund families, or go the conventional brokerage route with accounts not suited for that form of complexity.

"We insert ourselves between the distributor and the fund, and add value for the distributor, because it makes it easier to do this type of business. That adds value to the asset manager, because it's easier for their customers [the broker-dealers] to sell their funds, and they get sold in a way that's more efficient for the fund to run," says Kelly Lynch, SVP of Envision Financial Systems.

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Putnam Investments, QC-Boost
NOVA Industry Innovation Award
Machine learning is increasingly transforming all aspects of the asset management industry.
QC-Boost, the Putnam Investments platform recognized by NICSA for innovation, uses machine learning to help manage quality control processes for the firm.

The initiative "really brings contemporary capabilities to what is a traditional operations process of quality control," says Karen Walsh, head of the retail service center at Boston-based Putnam.

The platform draws from a massive data set going back almost a decade, composed of clerical updates and financial transactions Putnam has processed for shareholder accounts. A series of algorithms learns which items out of this data set are most error prone, then uses this historical information to predict likely errors in the present.

"The platform itself is iterative ... so it's continually retraining and learning with each day's work," says Walsh.

Earlier this year, the firm implemented a robotics process automation platform. "There's really a lot of untapped potential yet to come around all these capabilities," Walsh adds.

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American Funds, ACE
NOVA Industry Innovation Award
Aging technology can add risk to daily operations in asset management. American Funds' account management servicing application, ACE, was developed to replace a system that was over 20 years old.

ACE works to restructure data that passes to and from the client-account recordkeeping center, and provides a complete look at client relationships, rather than the single fund/registration position view of typical transfer agency systems, according to the firm.

The application also simplifies various transactions, which increases both quality and productivity.

"Given how complex both the investor and advisor relationships can be with multiple accounts and funds, one key aspect of ACE is that it simplifies all the client information and puts it in a simplified wrapper," says Christian Webster, vice president, the Capital Group/American Funds.

Looking ahead, the firm aims to continue to introduce new tools that incorporate robotics and automation, key trends to watch in asset management.

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Citi Fund Services, Form N-PORT Services
NOVA Industry Innovation Award
Sweeping new SEC regulations are changing the way fund groups will report their portfolio-wide and position-level holdings.

Asset managers will now have to comply with rules that require a whole new reporting infrastructure, as well as additional market data and analytics. Citi Fund services, in partnership with MSCI and Confluence, earlier this year launched Form N-PORT Services to help asset managers implement these new management practices ahead of the SEC filing deadlines.

"Developing this N-PORT offering to support our underlying asset management clients has been a multi-faceted and multi-year project that required partnership across our organization and with our external clients and partners to bring to fruition," says Jon Gezotis, director of product management for Citi Fund Services.

"Citi leveraged the extensive knowledge of our clients' business," he adds, "which we combined with our larger data strategy, and bringing them together we were able to demonstrate the potential and capabilities for delivering these types of services today and into the future."

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Delta Data, FundBlast
NOVA Industry Innovation Award
Fund change communications between asset managers and distributors have long been bogged down in inefficient processes.

In February, Columbus, Georgia-based Delta Data - a back-end software firm for the mutual funds industry — introduced FundBlast, a platform that supports real-time, streamlined communication between the parties. Often, in the case of mutual fund changes — including liquidation, mergers and purchase eligibility — notices are sent out by email blasts. This requires a time-consuming manual process that can also carry considerable risk.

The average broker-dealer, according to Delta Data, might sift through approximately 21,000 emails a year from fund partners; these can include multiple related clarifying emails.

FundBlast brings these communications to one portal, allowing for more efficiency. For one, notes the firm, "Due to the way that FundBlast organizes and structures data, it virtually eliminates the need for [the] clarifying emails."

Industry leaders including BNY Mellon adopted the platform shortly after it launched.

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