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Reference Data Storm in a Teacup

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Delegates to this year’s Sibos conference in Hong Kong faced high winds, lashing rain and a barrage of news about the world of reference data.

Given the drought of reference data specific discussion topics at last year’s event, it was refreshing to hear panellists discussing topics including XBRL data tagging, corporate actions standardisation and the concept of a reference data utility during the course of the conference. Swift also actively promoted its work with XBRL US and the Depository Trust and Clearing Corporation (DTCC) to further the development of standards in the corporate actions space throughout the week. My own Sibos panel also got a surprisingly high turnout for a Wednesday morning session: perhaps reference data really is getting its day in the sun? The reference data utility panel even inspired audience reactions!

In lieu of the fact that Francis Gross, the director general of the European Central Bank’s (ECB) statistics division, was unable to attend Sibos this year, his namesake Thomas Gross, CEO of SIX Telekurs, stepped into the fray. He was joined on the panel by fellow vendor Paul Kennedy, European business manager for reference data at Interactive Data, and David Gilmour, global product head of securities services for the Transaction Banking business of Standard Chartered. Gross elaborated on both the ECB’s proposals and SIX Telekurs’ own reference data utility in the Swiss market: Connexor.

He drew clear distinctions between the utilities, saying that while the ECB’s proposals are merely an idea at the moment, the SIX Telekurs utility is a reality. “Traditionally, industry players have to keep a golden copy of reference data in-house and this is expensive to maintain. To solve this we have launched a web-based service that updates and issues current reference data sets via the internet,” he told delegates. The ECB’s ideas to compel issuers to provide data via regulation and to provide the data on a cost recovery basis were identified by Gross as two of the main differences between the ECB’s approach and that of the data vendor. “SIX Telekurs is a commercial enterprise and this is different to the idea of setting up a standards college. A non-competitive approach may stifle innovation. The regulatory driven or industry standardisation approach has also historically proven to be a slow grinding mill, look at GSTPA for proof,” he argued.

The panel concurred that standardisation in the reference data space has proved to be difficult up until now and that vendor innovation may prove to be a catalyst for change in the future. This was not popular with one audience member in particular who hailed from industry standards group FIX Protocol. He asserted that industry standardisation has been successful in some areas and that maybe the back office should look to the front office for inspiration. Gross then claimed that the SIX Telekurs model could be applied to other countries and he indicated that he thought this would be a more practical approach to establishing utilities. However, the panellists were not in agreement on this idea. Kennedy contended that a utility is not desirable at all: “Data is a living, breathing thing. It is continually changing and so requires proactive commitment to keep it current. The utility model puts it in a box and makes it bland.

Reference data is not static and should not be treated as such.” Panellists seemed to be in agreement that the ECB may be taking the wrong tack and that data dialects need to be improved so that greater connectivity and reconciliation can be achieved between data formats. Kennedy held out the hope that XBRL will be part of the solution for the future: “We should look at firms such as Google for proof of the potential capabilities for data tagging out there.” Although there was not a lot of agreement on what the future will look like, Sibos certainly proved there are more than a few people out there that are willing to get out of bed in the morning for reference data discussions and that has got to bode well for change.

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