By Antony Michels
A know your customer transformation project takes shape, with four MNCs joining Coke in effort to ease laborious process.
Coca-Cola’s director of international treasury, Jim Aschmeyer, is on a mission: He wants to transform the long-standing and increasingly painful process of complying with anti-money laundering (AML) and know your customer (KYC) regulations. “AML/KYC is a process that clearly has no winners,” said Mr. Aschmeyer. “It’s as painful and inefficient for the banks as it is for the corporates—the classic death by a thousand paper cuts for all involved.”
For corporates, the pain includes repeated, often redundant, requests by banks for information and documentation, as well as difficulty coordinating across regions and time zones. Banks, meanwhile, have difficulty extracting data from emails or hard copy documents. And all parties suffer from the lack of standardization across banks and the huge investment of time KYC takes, with little or no value added.
Today, though, Mr. Aschmeyer has guarded optimism about solving these problems, thanks to a demo the Bloomberg Entity Exchange team did for him and some other corporates in Atlanta in late 2017. “As the demo proceeded, I kept thinking to myself that this could be the spark for change we’ve been looking for,” he said.
Entity Exchange is a web-based, globally scaled, centralized, secure platform that enables trading counterparties to manage and share client data and documents. “It’s also bank-agnostic and has some very useful bells and whistles,” Mr. Aschmeyer said. Entity Exchange allows banks to easily locate required AML/KYC information, since all of the documents and data uploaded by corporates are classified, stored and digitized by the Bloomberg team using a tightly managed, globally standardized taxonomy, he said.
“Entity Exchange provides a foundation for simplification of long-standing practices that are simply unsustainable—we can start to move away from the concept of required documents to one of required data,” Mr. Aschmeyer said. “If we can do this, I believe it really opens the door of possibilities even further.” What’s more, he said, “As a global company, we don’t do a very good job of managing our KYC information internally. So this core capability alone provides us with real value.”
To turn his KYC vision into reality, Mr. Aschmeyer spent the past six months looking for what he calls “partners in crime.” The result is a team consisting of Citibank, Bloomberg, Coke and four other large Citi customers—Merck, UPS, Cargill and Procter & Gamble. He said the initial roundtable meeting hosted at Citi’s headquarters in New York in late August allowed the team to meet in person for the first time, to ensure full alignment and understanding around the many AML/KYC pain points, and to agree on the next steps for what is being called the KYC Transformation Project.
“This team includes the largest global corporate bank with Citi, a leading global information technology provider with Bloomberg, and five highly energized MNCs ready to make a difference,” Mr. Aschmeyer said. “It’s a lean, highly focused team.”
To turn his KYC vision into reality, Mr. Aschmeyer spent the past six months looking for what he calls “partners in crime.” The result is a team consisting of Citibank, Bloomberg, Coke and four other large Citi customers—Merck, UPS, Cargill and Procter & Gamble.
For the project to truly succeed, Mr. Aschmeyer thinks all of Coke’s depository banks—not just Citi—would need to be on Entity Exchange. He’s confident that this will happen. “The transformation snowball is already starting to roll. I’ve had discussions with most of our other key banking partners, and without exception they have all been pushing to join the project.” Bloomberg says eight of the top 10 global banks are on Entity Exchange.
As for banks that may prefer to push their own solutions for KYC, Mr. Aschmeyer says any solution that will bring about true change must be bank agnostic and globally scalable on Day One. “We already have enough issues around managing bank portals. There has to be a single global point of entry for information,” he said. “A bank-specific solution simply does not get me to where I need to be.”
Mr. Aschmeyer, who has been at Coke since 1995, says his passion and efforts for the KYC project are driven by his own company’s changing culture, which is now dominated by a focus on what matters most. “To do this,” Mr. Aschmeyer says, “we need to leverage technology and our critical partners when we see opportunities for meaningful, positive transformation.”