Investment Manager Solutions Specialist
Riley specializes in helping Clearwater clients maximize the efficiency of their investment accounting and reporting processes. Riley helps investment management firms and investment accounting teams implement industry best practices to streamline their operational processes and offers expert guidance on regulatory updates and industry changes.
Riley has a bachelor’s in electrical and computer engineering from Boise State University.
Have you ever found yourself in an awkward position at a board meeting, where you spend the entire presentation trying to explain why some of the slides — prepared by different departments — have conflicting data?
If you have, you’re not alone. Data governance is an issue found in firms of all sizes.
On June 21 at The Summit for Asset Management (TSAM) in New York City, investment professionals discussed how a firm can handle conflict over the classification and quality of data. I was pleased to be one of the panelists on the forum, titled Internal Data Debates — Finding Solutions for Colleagues’ Pain Points. The other panelists were Sanjay Bery, Managing Director of Data Management at TIAA; and Jon Julian, SVP, Head of Data Integrity Group at Voya Asset Management. The conversation was moderated by Accenture Director Mick Cartwright.
The basic consensus of the panelists was that organizations need to build a culture around the importance of data management. Various departments need to come together to realize the importance of integrity and completeness of data the firm uses to operate day-to-day.
Every firm is made up of people with varying backgrounds and areas of expertise. Communication across all levels is key, as is understanding what is important to each person. Think of these variances as different “data dialects.”
Half the challenge of operating a successful investment firm is getting all interested parties, from portfolio managers down to back office operations, to communicate at the same level about the same type of data. Depending on their perspective in the trade process, someone might argue that a security should be classified one way, while someone else might push for it to be classified completely different. And, how a data point is defined might influence how a trade is executed or a portfolio is managed.
Some helpful points:
Sometimes it simply comes down to terminology because people think and act differently. To speak broadly, people in certain areas of the US say “soda,” while people in other parts of the US generally say “pop.” Both refer to the same thing, but have a different name and perhaps slightly different connotation.
The same principle can apply to data governance in an investment management firm.
Utilizing a third-party software system should provide flexibility in areas where you need it most. With the proper middle office solution integrated with a robust reporting platform, the data can be input in a variety of ways and shown to the client side-by-side, allowing the client to see differing views of their investments. In the end, it is the client’s money, and they deserve to see the information in multiple ways to facilitate an insightful discussion with their portfolio managers.
Such flexibility in reporting also allows you to model a firm’s risk. In this way, differing opinions about data governance are really important.
Whenever there is a pain point in your organization about data governance — and there always will be — consider the benefits of open communication and flexibility to ensure your firm’s continued success.
I had a great time at TSAM New York. I met some wonderful people with great insights into the investment management industry whom I hope to see again soon. Additionally, it is always a pleasure to catch up with acquaintances and attend the educational speeches and panels at this annual event.