Data governance is less about data and more about trust, trust between people and trusted information that can open up business opportunities for financial services firms and deliver benefits to customers and shareholders.
Presenting a keynote at the A-Team Group Data Management Summit in London, Lorraine Waters, deputy group chief data officer at HSBC, outlined the bank’s data governance and data management policies, and their role in developing trusted information that can be used intelligently.
HSBC is signed up to the UK Corporate Governance Code and reflects the requirements of corporate governance in its data governance, which includes policies and principles; roles and responsibilities; training, education and awareness; data risk identification, monitoring and management; and data quality control and reporting. The bank has a data governance framework including a group data policy that prescribes how data should be managed, and has named accountable executives for data in each of its global businesses and across most of its global functions, including finance, risk and IT.
Waters, who joined HSBC a year ago, described the data governance framework as a contract of trust between the data organisation, the bank’s internal and external stakeholders, and its customers. Data management policies within the framework include training on group data capabilities and training on data quality for everyone in the bank. Waters explained: “This training fits with our Know Your Customer and Anti-Money Laundering practices and will make the organisation more customer centric. In turn, this will improve customer service.”
The bank is also in the process of defining a target operating model that will include not only people, process and technology, but also, for the first time, data. Data will also be included in all change management discussions.
Beyond policies, Waters discussed the practicalities of moving up the data management maturity scale and the need to achieve a high level of maturity to comply with the forthcoming Basel Committee regulation BCBS 239. She said: “The financial crisis showed us and our regulators how important it is to have timely, accurate, accessible and trusted information. In this digital age, as customers get closer to the data we hold, it is important to have clean, available, secure and accurate data.”
Considering the benefits of data when it becomes trusted and can be used intelligently, Waters said: “When underlying data is trusted, big data initiatives and analytics can deliver incredible insights and opportunities. Data is an asset and should be managed and measured accordingly across its lifecycle. Our chief data officer organisation has oversight across the whole data lifecycle, from acquisition, through validation, maintenance, storage, distribution, control, value measurement and safe demise.”
Looking forward, Waters said HSBC will continue to focus on the requirements of BCBS 239, and concluded: “One of the principles of BCBS 239 suggests considering data quality risk as an identifiable risk in the risk taxonomy. Data quality issues are typically seen as a symptom or outcome and not as a standalone risk. It is worth considering this when you are developing a data strategy or putting in place data governance frameworks.”
You can listen to a full recording of the session here.