What Can Be Learned From LEI Board Nominations?

Who would volunteer to take responsibility for establishing and managing the operational arm of the legal entity identifier (LEI) system? After a longer-than-expected five months, the industry found out this week, when the Financial Stability Board (FSB) published the nominees for the board of directors of the Global LEI Foundation, which will be charged with setting up and running the Central Operating Unit (COU).

In choosing 16 nominees from the roughly 50 applications it received, the LEI Regulatory Oversight Committee (ROC) has followed closely the selection criteria it published in August. However, there are some surprises and interesting clues about the form the COU might take.

Some practitioners have expressed surprise that more representatives from banks and other financial firms have not been nominated. However, their concerns have been allayed somewhat by the inclusion of JP Morgan Chase's Robin Doyle, who is respected throughout the industry and who has already contributed a great deal to the LEI project.

It is also noticeable that the USA is the only country with more than one representative on the list of nominees. After early concerns, the LEI was being viewed as a US project and other countries may be reluctant to become involved, it is surprising the ROC has put forward four Americans. However, given the variety of skills available in the US, this situation was perhaps likely, and it is right that the quality of the board of directors should take precedence over public relations sensitivities.

Perhaps the most interesting thing about the ROC's choices is the inclusion of three nominees from organizations behind P-LEI.org—a website that collects and consolidates pre-LEI data into a single file. The website was launched in the middle of last year, and has become an invaluable tool for industry participants faced with the challenge of managing data from multiple pre-LOUs, without a COU to consolidate the data or ensure all pre-LOUs use the same file format.

The industry has begun to wonder whether P-LEI.org can viewed as a prototype for the COU

P-LEI.org is a joint project of GS1, Tahoe Blue, FIX Protocol and the Corporation for National Research Initiatives. The nominees for the board of directors of the Global LEI Foundation include Ravi Mathur, chief executive officer of GS1 India and Tim Smucker, the chair of JM Smucker Company, who is also on GS1's management board. Tahoe Blue is represented on the list by its founding partner Jefferson Braswell.

P-LEI.org emphasizes that it is not affiliated with the FSB, the ROC or any financial regulator. However, with the organizations behind the website well represented in the nominations for the board of directors of the Global LEI Foundation, the industry has begun to wonder whether P-LEI.org can be viewed as a prototype for the COU.

With the nominees still subject to legal checks in Switzerland and ratification by the FSB board, we will have to wait a little longer to see how closely the COU will follow the example set by P-LEI.org.