Leveraging shareholder data for beneficial ownership transparency
Summary
This working paper examines how and to what extent shareholder information can be leveraged to improve beneficial ownership transparency (BOT) and help understanding corporate structures or networks. While there is conceptual overlap between shareholding (i.e. legal ownership) and beneficial ownership (BO), they are often treated separately in legal and technical frameworks. This is despite the fact that high-quality, centralised shareholder data can strengthen BO disclosure regimes by supporting verification; reducing compliance burdens and costs; and avoiding the collection of duplicate information. It also improves the usability of BO data and helps users to accurately understand complex corporate networks. Better shareholder data also supports many of the policy objectives that governments pursue through BOT reforms.
Against this backdrop, this study assesses how shareholder register data can contribute to understanding corporate networks and inform the design and implementation of BOT systems. Drawing on two case studies – Estonia and Zambia – the analysis compares structured shareholder and BO data, and explores the following questions:
- Data overlap and alignment: To what extent do shareholder and BO registers capture the same ownership information?
- Interest types in BO data: What proportion of BO declarations relate to shareholding, compared to other forms of control (e.g. voting rights, appointment powers, or other means of control)?
- Domesticity of corporate networks: To what extent are corporate networks derived from shareholder data domestic, and how does this compare with those derived from BO data?
The analysis highlights distinct and complementary roles for shareholder and BO data in understanding corporate networks. Across both contexts, the findings reinforce that most corporate structures are relatively simple, often involving direct ownership by a small number of individuals. In such cases, shareholder registers can already capture a substantial proportion of interests and relationships that are later reported through BO declarations, suggesting that shareholder data can play a significant role in supporting BOT systems in practice.
At the same time, information collected through BO declarations remains essential to capture forms of control that are not visible through shareholding, including indirect ownership and other non-share-based mechanisms. In lieu of access to foreign ownership data, it helps identify cross-border ownership structures. Given the predominance of simple structures, these insights are likely applicable beyond Estonia and Zambia.
Overall, the findings suggest that leveraging existing – or investing in – central shareholder registers can significantly enhance the effectiveness of BOT reforms while also helping achieve those reforms’ policy aims. While such improvements can be achieved at the national level for immediate benefits, greater alignment across jurisdictions and improved cross-border access to this information will strengthen understanding of transnational corporate networks and may help to gradually reduce the strengthen understanding of transnational corporate networks and may help to gradually reduce the duplication in BO declarations at the national level.