78% of delegates at the FIMA 2014 conference last week said that that regulatory change has accelerated their data strategy rather than slow it down. FIMA brings together the reference data and risk management community every year in London and this year during the Flash Panel: The impact of regulatory change on your data strategy – what should you be focusing on today? the audience were asked whether regulatory requirements have affected their firm’s data strategy and results showed that for many firms’ regulatory requirements have had a positive effect on data management.
Marion Leslie (Managing Director, Pricing and Reference Data, Thomson Reuters) led the panel of industry experts during the discussion, which included Tom Springbett (Head of FCA’s OTC Derivatives and Post-Trade Policy). Springbett's inclusion on the panel gave both the panellists and the delegates the opportunity to question financial authority on their recent requirements. According to Springbett, the FCA encourages firms to adhere to regulation and if it improves their understanding of data at the same time then they are happy.
Sessions at FIMA mostly focused on governance and regulation, and all of the speakers seemed to be in agreement that firms need to take a new approach towards data, whether this is through better data governance structures, effective collaboration and communication between different job roles and discovering usable data that has quality.
According to Donna Rudnicki (Managing Director, Chief Data Officer, RBC Capital Markets) data governance and data management needs strong organisational structure and she said that it is important for firms to have a clear direction that they are working towards.
John Bottega (Chief Data Officer, EDM Council) believes that the objective of governance is to influence behaviour and that industry players need to do something different regarding data. Ken Napolitan (Global Head of Sales, Enterprise Content and Distribution, Bloomberg) also agrees and said that firms continue to face potential crisis because they are not looking below the surface.
When it comes to big data, Tarill Bajer (Global CDO, HSBC) believes that firms need a team to handle big data and that firms should use the following steps to create this team:
- Determine structure
- Look around you
- Fill talent groups
- Cross Train
- Use don’t lose staff
- Equip and empower by give the right people access to data
Alan Paris (Principal Financial Services, eClerx) said that there is a growing awareness amongst firms to look at data as a whole, rather than just focusing on product and client data. Firms increasingly need look into legal reference data, such as trade and vendor agreements, legal documentation around loans etc.
“The whole industry is facing massive regulatory change, immense pricing pressures and organisational change to become more efficient and to look at products across the firm and break down the various siloes that have been built up over the years,” he said.
Paris believes that the regulatory regimes of Dodd Frank and EMIR have forced firms to look across the barriers which existed between product areas and departments. “Firms will usually set up a regulatory programme that is funded from multiple entities and has CEO-level sponsorship. During these programmes there are responsible people from different departments such as operations, IT, global markets and equity who are driving the programmes to address regulatory change and are looking at it to find the commonality between the regulations. Solutions providers such as eClerx are brought in to help with the detailed metrics, quality information and provide reporting on this.”
Paris said that he hopes a lot of the regulatory work will be done within the next two years which will mean that financial services firms can go back to focusing on their core business functions, building new products and finding profitable business models that work within regulatory constraints. “There is wholesale structural change going on within the finance services industry which should make it safer and more stable for everyone and the exercise of firms’ creating more functional cohesion between their teams is a good thing which at some point in the future will become normal.”
By Nicole Miskelly, bobsguide Lead Journalist