XBRL US today announced that the Corporate Actions Taxonomy, which can be used to report corporate actions announcements and events, has been finalized and is available for use.  The taxonomy is a collection of data tags that are aligned with elements of the ISO 20022 global corporate actions standard.  It was developed as part of the Issuer to Investor: Corporate Actions initiative, a collaborative industry effort sponsored by DTCC, SWIFT and XBRL US that uses standards to streamline the communication between issuers and investors.

Corporate actions are publicly traded company events such as mergers, dividends, stock splits and other events that may require an action to be taken by an investor or financial shareholder.  The Corporate Actions Taxonomy has 550 base elements, in contrast to the US GAAP Financial Reporting Taxonomy used by public companies today for SEC reporting, which has more than 18,000 elements.  The Corporate Actions Taxonomy covers 94 types of corporate action events.

Today's corporate actions processing requires public company issuers to submit text-formatted documents such as news releases and regulatory filings for each corporate action which are then interpreted and rekeyed by stock markets, issuer agents and data intermediaries before the time-sensitive information is available to shareholders. The Corporate Actions Taxonomy standardizes this free-form text into electronic documents that can be used by issuers to ensure written words hold the same meaning for all parties throughout the corporate actions lifecycle. Having issuers electronically tag corporate actions data in XBRL allows it to be delivered straight from the issuer to the investor without rekeying or interpretation through multiple interfaces. 

"The goal all along has been to make it easy and inexpensive for issuers to identify and tag key data as they prepare documents for a corporate action," said Donald F. Donahue, president and CEO of DTCC.  "Completion of the corporate actions taxonomy represents a significant milestone in this undertaking and moves us a step closer to straight-through-processing.  As we move ahead on this initiative, we look forward to demonstrating how XBRL helps reduce risk, boost efficiencies and cut cost in corporate actions processing."

In conjunction with this initiative, Citi is working with XBRL US on a pilot program to demonstrate the costs and benefits of using XBRL in the corporate actions processing of dividend payment announcements for American Depositary Receipts (ADRs).  XBRL US revised the taxonomy based on input from Citi’s technology group on various corporate action notices.  The pilot program will help determine the feasibility of moving to XBRL processing and its impact on downstream consumption of XBRL data.  Forty XBRL-formatted dividend announcements have been created through that pilot program. To support the downstream corporate actions flows from the depository to custodians, DTCC is now running a pilot over SWIFT using new ISO 20022 corporate actions messages.  The pilot includes a handful of custodians and is expected to run through November 2011.

"The market demands greater clarity of information", said Chris Church, Chief Executive, Americas and Global Head of Securities, SWIFT.  "XBRL, coupled with ISO 20022, will enable a seamless flow of information across the corporate actions lifecycle resulting in increased transparency, lower costs, less risk and better informed decisions by investors.  The key to success is issuer adoption, but through awareness campaigns and industry support, we hope to move the issuer community in that direction."

According to Alan Smith, Managing Director, Securities and Fund Services at Citi, "Citi’s participation in the XBRL US pilot program is just part of our commitment to industry-leading technology.  XBRL for Corporate Actions provides a streamlined process that can help mitigate operational risk while reducing costs, and we feel that this can be a very valuable tool for our clients."

A business case describing the impact of XBRL on the corporate actions process has been published and is available at: (http://xbrl.us/i2i/pages/businesscase.aspx).  The Corporate Actions Taxonomy can be downloaded and viewed at (http://xbrl.us/taxonomies/Pages/2011corpactions.aspx).