The importance of data governance in financial services firms has never been greater as regulators scrutinise not only data but also its quality and business executives begin to understand data as a valuable asset. Reflecting the growing importance of data governance, A-Team Group addressed the problems it poses and the opportunities it presents at its recent Data Management Summit in New York City.
Andrew Delaney, chief content officer at A-Team, led the discussion and was joined by industry experts John Fleming, head of enterprise data governance at BNY Mellon; Dessa Glasser, chief data officer at JP Morgan Asset Management; Dale Richards, managing director of consultancy Island 20 Ventures; and John Yelle, vice president of data services at DTCC.
Delaney started the conversation by asking which regulations are causing firms most pain in terms of data governance. Not unexpectedly, the experts’ answer was BCBS 239, which shines a light on data quality and the importance of data governance. They also noted elements of Dodd-Frank, regulations mandating the use of the emerging Legal Entity Identifier and requirements for ‘as at’ historical data. Richards commented: “Pain points and opportunities often occur at the same time. The ability to solve a data problem for regulatory purposes can provide opportunities for new analytics and value add. Data quality is also important. Nobody cared about it 20 years ago, but people do care about it now and know that without quality data, reporting can produce garbage.”
Fleming agreed that regulation is a driver of data governance, and added: “Looking more broadly, firms have vast amounts of data. Data governance provides an opportunity to look at data as an asset and at ways to drive change for the business. The reality is that we must manage data and its growth in volume on a scale we have never seen in the past. Then we must consider how to use data to improve customer satisfaction, deal with operational costs and reduce risks.”
Considering whether we have reached the peak of regulation this year, Yelle cautioned: “We have not reached the peak and it would be dangerous to assume that we are going over a hump. We are on a plateau, there won’t be any relief any time soon and we won’t go downhill for a long time.”
Discussing why the practice of data governance is important, Glasser said: “Governance is a framework that allows you to look at data as an asset that you need to cultivate and maintain. It is critical to understand what data we have, how we define it, use it and understand its lineage. It must be presented in terms the business understands and must be put into business use.”
Explaining the implementation of data governance, Fleming said: “We have a new programme at BNY Mellon. The first phase will build out processes, roles and responsibilities. While different people have different views of governance and data ownership, for me it includes a business glossary, data dictionary, data quality, data stewardship and data lineage. My programme also has three other tracks, communication, change management and learning. BNY Mellon includes 55,000 people and I must touch all of them and get them to change their behaviour. This makes change management the biggest part of the programme.”
Responding to a final question from Delaney about whether data governance is a sprint or a marathon, Richards concluded: “It’s a marathon, it’s about data as a long-term asset. Within the broader data management imperative, it is the core piece.”