Buy-Side Technology Awards 2016: Winners' Circle—Fidessa

What separates Fidessa Sentinel from other compliance products in the space? 

Richard Hooke, buy-side product director, Fidessa: Sentinel was designed from its inception to be a standalone, flexible and extensible compliance platform. These fundamental tenets, coupled with a relentless investment in the product, have enabled Sentinel to endure the test of many years and to win multiple awards.

Being a standalone, independent application means that it is not shackled by the constraints imposed by being subjugated within a larger suite of systems. This means that it has 100 percent of its focus on compliance. It also means that it has extensive integration functionality that enables its superior compliance capabilities to be woven seamlessly into the diverse range of infrastructure seen within the industry. Sentinel allows institutions to develop a compliance framework that is always fully aligned to the dynamics of the business, rather than acting as a constraint to them. Sentinel’s independence also means that it has concentrated on allowing the customers to define the data, rules and analytics that power the compliance function. This flexibility has more than stood the test of time and means that customers can respond to new mandates and regulations quickly and simply.

We never have and never will stand still. We have invested constantly in expanding and developing Sentinel, driven by the needs of our customers and the market.

What enhancements have been made to Sentinel over the past 12 months? What were the driving factors behind them?

Hooke: The drivers we see in the market are the increasing demands of regulation, complexity, scale and transparency, combined with the continued focus on reducing cost. We work closely with our customers through a combination of direct meetings and our user group to discuss these trends and to feed into our product strategy. Last year we focused on increasing the efficiency of some key business processes for our customers by streamlining the user’s workload and making onboarding new funds and mandates faster and more accurate with the addition of account cloning and bulk maintenance of rules.

We also expanded the capability of the Trading Compliance functionality we introduced 18 months ago. This was partly driven by the new US Department of Labor regulations, which Sentinel Trading Compliance supports by storing transaction-level data, including commission, and evaluating trading charges on a per-transaction basis, or aggregate by broker, account or other attributes, in real time (pre-trade) or on a historical perspective.

We have continued to invest in performance in order to maintain our position as the fastest compliance system and to keep ahead of the increasing use that our customers are making of Sentinel with key gains, notably: Post-trade processing now runs 45 percent faster; front-end searches for large sets of incidents complete 45 percent faster; and reference data loads five times faster.

In what areas are buy-side firms’ compliance programs most often lacking? How can Sentinel help them?

Hooke: Compliance, like many operational areas of investment firms, is constantly trying to do more with fewer resources. The regulatory burden is increasing, together with the complexity of the markets and the sophistication of the trading and portfolio activity. All this feeds into a compliance process that is constrained in terms of resourcing. Sentinel helps by providing automated evaluation of rules, a robust workflow and the tools to enable the compliance teams to efficiently research potential compliance breaches, and to communicate this in detail to the stakeholders, be they senior management, clients or regulators.

What future enhancements do you have planned for Sentinel over the next 12 months?

Hooke: One of the strongest themes to emerge from our recent user meeting in New York is “event risk”—this is assessing, in advance, the compliance implications associated with a market or political event, such as a potential credit downgrade or an event such as Brexit. Many firms obviously prepare for such situations, but this has historically been in the area of performance, hedging and risk. Increasingly, however, firms want to see the impact that an event might have on their compliance situation as this may affect their hedging scenarios or require a broader adjustment of their portfolios in response to an event. Providing support for this style of testing is an area of interest for us next year.