WFIC: LEI is Data Management Game-Changer, Say Practitioners

The majority of financial information professionals suggest the legal entity identifier (LEI) will be a positive global game-changer, according to an audience poll at the World Financial Information Conference in San Francisco in October.

Panelists agreed with other conference-goers, saying the reason there is a need to change the game in terms of legal entity data management is obvious. "The retail industry would not have been what it is today without the barcode. That's how the game changes," said Francis Gross, head of the external statistics division, in the directorate for general statistics, European Central Bank. He added that the industry is in for a learning process – "but we will get there."

Julia Sutton, global head, customer accounts operations, Royal Bank of Canada, said: "The LEI will be a dumb number. It will have core pieces of information added to it in the first phase, and it is something we need."

According to speakers, the new, unique identifier is a big step forward in terms of risk management. It will also improve firms' ability to rely on automation, and the introduction phase will allow them to further improve data management processes.

In fact, the clear benefits of the LEI mean there is little disagreement in the industry on the topic. It is only when speaking to professionals outside the data community that there can be opposing views, but mainly because of lack of awareness, said speakers.

The next step now is to ensure regulators get involved. Panelists said the global regulatory community needs to come on board, and called for market participants to discuss the LEI with local regulators, and ask them to adopt it in their rulemaking. "It has to be regulated. There are so many benefits, so it makes no sense not to do it," said Sutton.