The global post-trade landscape is undergoing a non-negotiable transformation. With the accelerating shift to T+1 settlement, the introduction of Artificial Intelligence (AI), and the continuous need for operational resilience, firms face a complex mandate that goes far beyond simple technology upgrades.
To gain clarity on these critical industry shifts, we spoke with Danny Green, Head of International Post-Trade at Broadridge. Green, who oversees Broadridge’s solutions for Europe and Asia, shared an insightful perspective, emphasizing that the most significant challenges are operational, not just technological.
T+1: A Race to Operational Efficiency, Not Just a Tech Upgrade
The move from T+2 to T+1 cuts the settlement window in half, a transition Green stresses is far more than a simple system patch.
“The key realization is that T+1 isn’t just a technology upgrade; it’s also an operational challenge,” Green notes. “Manual, resource-intensive processes that firms can just about manage today will become far harder tomorrow. You no longer have the luxury of ‘we’ll deal with exceptions tomorrow.’ They need resolving immediately.”
The urgency demands an end-to-end review of operating models alongside core automation. According to Green, technology must focus on three core areas to reduce settlement fails and risk:
- Visibility & Workflow: Identifying and eliminating manual workarounds that obscure true exception rates, followed by smart workflow management to push the right data to the right people.
- Location Alignment: A significant number of fails are due to securities being in the wrong settlement location, not a lack of stock. Automating the flow to ensure assets are correctly placed is crucial, particularly in Europe.
- Fail Prediction: Leveraging historical data to assess the probability of a trade failing, allowing firms to proactively prioritize high-risk items.
The Buy-Side Blind Spot
While custodians and the sell-side are deeply engaged in T+1 preparations, a major blind spot remains: the asset manager and buy-side community. Settlement success hinges on every actor in the chain, making broader, more urgent industry-wide outreach vital to ensure comprehensive readiness.
Beyond compliance, however, the T+1 deadline presents a silver lining. It is an industry-wide catalyst forcing the modernization of legacy systems, which will ultimately drive long-term efficiency, reduce costs, and increase market liquidity.
AI: The Journey from Governance to Democratized Data
AI is rapidly moving from a theoretical concept to a practical tool in the post-trade sector. Green emphasizes that for Broadridge, the journey began with rigorous foundational work: governance, security, and validated data curation.
“AI is only as good as the data behind it,” he points out.
Broadridge is currently applying AI to two specific, high-impact use cases:
- Stock Alignment for Settlement: Using AI to precisely ensure assets are in the correct place at the right time.
- Data Democratization: Moving beyond reliance on IT departments for custom reports. AI enables users to directly interact with vast post-trade data—even in their native language—to gain faster, actionable insights and drive better decision-making.
Building “Always-On” Resilience
The combined pressure of shorter settlement cycles, rising cyber threats, and the emergence of digital assets means that system downtime is increasingly unacceptable. Green sees always-on availability as moving from an optional feature to the market norm in post-trade, mirroring the transition already seen in trading.
This shift mandates the phasing out of older, legacy batch-based systems in favor of continuous processing architectures.
On the security front, resilience involves proactive protection and preparation. Green highlights the importance of working with clients and regulators on best practices, including using immutable storage solutions to safeguard sensitive data.
Furthermore, lessons from recent market disruptions underscore a key realization: firms must go beyond standard disaster recovery drills. The essential lesson is developing detailed playbooks for specific scenarios—whether a cyberattack, a major outage, or a utility failure. Knowing how to respond in advance dramatically cuts recovery times.
The Power of Industry Collaboration
Broadridge’s approach to balancing speed, efficiency, and resilience rests on its ability to convene its client community. Green concludes that tackling multiple, interconnected challenges—from T+1 execution to AI deployment and systemic resilience is most effective through collective prioritization and industry-wide collaboration.
Ultimately, as observed at recent industry events, the most encouraging sign is that the industry has decisively moved from planning mode into execution mode on critical initiatives like T+1, setting the stage for a more robust and efficient future.