Access to sound and reliable regulatory data is vital to the health of our financial system. There are valuable data collected by U.S. regulatory agencies, but too many feeds are unstructured and remain document-based. The current regulatory systems result in unstructured financial data that are both hard to report and hard to use, especially for any large scale or timely data analysis. This need for useable data is especially critical in times of crisis like we are seeing now when market and regulatory data can be used to provide insights to make effective evidence-based policy. As the private sector improves the capabilities of regulatory technology (RegTech), the lower quality data from regulatory agencies become more pronounced. Working with industry and regulators, the Data Coalition advocates for policies to modernize the financial regulatory system’s reporting requirements, facilitating cooperation between regulators and regulated industries. By moving towards open data standards, RegTech applications can be deployed to reduce errors, lowering operational costs, and speed up reporting times.
Modernizing the regulatory reporting system to support emerging markets and RegTech is a priority of the Data Coalition. By supporting legislative initiatives and facilitating cooperation between regulators and the regulated industry, the American public will benefit from standardized, open regulatory information. The Data Coalition will work to advance these priorities, by building on reporting rules from the Securities and Exchange Commission (SEC) working with Congress as the Financial Transparency Act (H.R. 4476) advances, and growing the network of potential stakeholders and advocates for implementing RegTech solutions at the virtual RegTech Data Week.
Next week the Data Coalition is hosting the RegTech Data Week, April 20-22, in partnership with DFIN. Through the 3-day long virtual series, the Data Coalition intends to highlight emerging RegTech leaders and to showcase our members’ RegTech solutions. During this virtual event, participants will discuss the emerging need and use for common entity identifiers, the development of new pilot projects to advance the use of structured data in regulatory reporting, and other key considerations for adopting RegTech solutions in 2020 and beyond.
The week opens with Poppy MacDonald, President of USAFacts, discussing the first-ever iXBRL tagging of USAFacts’ full-length U.S. government 10-K, an annual report required by the SEC that gives a comprehensive summary of a company’s financial performance. By reporting government spending in a machine-readable, iXBRL format makes government data more accessible to the public and improves speed and reliability. The next day, attendees to the virtual event will hear from representatives from regulatory agencies, who will discuss modern approaches and applications used to address regulatory challenges, giving attendees insight into how the government is tackling RegTech solutions.
On the final day of RegTech Data Week, Wednesday, April 22, attendees will hear from industry leaders. Opening the day’s programming, panelists will explore existing options for international, open identifiers that could be leveraged by U.S. regulators to improve efficiencies both in markets and government oversight.
Among the Data Coalition’s legislative priorities is the bipartisan Financial Transparency Act (FTA), introduced in 2019. The FTA would require regulated entities to adopt such an identifier, as a part of a broader move to adopt specified data standards with respect to format, searchability, and transparency. By the time of the bill’s introduction, approximately 1.5 million LEIs had been issued in over 220 countries. There are still significant gaps in the adoption of this data standard, but the Data Coalition advocates for wider adoption, which will be the best way to realize the full efficiencies and benefits of a common identifier.
The event will wrap up with a keynote from Nirvana Farhadi, Global Head Financial Services RegTech, Hitachi Vantara, who will offer insights into rapidly emerging roles for RegTech. The keynote address will also describe why RegTech is essential now more than ever and the importance of government and private sector working together.
Tune in for the RegTech Data Week as we work to develop and advocate for meaningful solutions that make our country’s data higher-quality, more accessible, and more usable.