Managing data has never been harder for firms, says Kristin Hochstein, head of entity data services at Refinitiv, and ISITC vice chair.
(Kristin Swenton Hochstein wears many hats. She is the head of entity data services for Refinitiv, the company spun off from the former financial and risk businesses of Thomson Reuters. She also serves as the recently elected vice chair for ISITC, the securities industry group pushing standards and best practices to improve operations. She is also an ISITC board member and the executive sponsor of ISITC’s Regulatory Forum and Reference Data and Standards Group. Prior to her role at Refinitiv, Hochstein led the pricing and reference data solutions efforts across Thomson Reuters, and helped launch a counterparty and legal entity data business for Reuters, prior to the Thomson merger. She also worked at Dun & Bradstreet in a variety of roles, including senior director in the credit risk business. She took time out of her schedule to take questions from FTF News.)
Q: What is the significance of the new name, Refinitiv? Why not keep some version of the Reuters branding?
A: Reuters is a fantastic business and fantastic brand. It is the largest and most respected news organization in the world and remains a core component in the name of its parent, Thomson Reuters.
But we’re a new company and we didn’t want to confuse the market. Refinitiv is all about definitive action in financial markets and we’re excited to live up to that promise in every interaction with our customers.
Q: How many services are you overseeing via your position as head of entity data services?
A: My global responsibilities include issuer reference and entity risk data across our DataScope product suite as well as leading our managed data and regulatory services following the acquisition of Avox, now Verified Entity Data as a Service (VEDaaS).
I also look after the corporate actions business, all within our larger pricing and reference data.
Q: What is your sense for the entity data needs of buy-side firms and sell-side firms? How are those needs different and how are they the same?
A: There are many needs for accurate and timely entity data across firms.
On the buy-side, the primary focus is on investment compliance and ensuring linkage to issuers and the associated industry sector classification, country of risk, and hierarchy, to name just a few.
While also important for the buy side, ensuring the highest quality entity master for client on-boarding, risk management, and compliance and regulatory reporting is a major focus for our largest banking clients. They use VEDaaS content to have a single, trusted source across their business and the benefit of reducing the burden of entity data collection and maintenance.
Q: How is ISITC’s standards work impacting the entity data needs of securities firms? Are there some direct efforts that readers should know about?
A: At ISITC, we strongly encourage and provide the groundwork for: embracing standards and the best practice adoption of evolving with the industry and streamlining reference data; collaborating on the policies that increase interoperability; and engaging with other firms to share in-depth knowledge and solve industry challenges together.
We have an active effort throughout ISITC’s live events, including our recent successful securities operations summit and upcoming fall and winter forums.
We also have our active working groups, all designed to develop standards, create efficiencies, and help revolutionize our industry.
Q: What are some areas of entity data management that concern you?
A: Financial institutions are facing a wave of regulation increasing their legal entity and reference data reporting obligations, such as MiFID II, AnaCredit, MAS 610 [reporting regime], and QFC [qualified financial contracts].
But these and so many other regulations are fragmented, creating data management issues for businesses operating globally. There is a lot of work for the industry to do around standards to simplify these efforts, but the geopolitical environment means additional challenges getting in front of these issues.
Q: A panelist at ISITC’s recent summit said that data is new gold rush for the securities industry in that there is so much value that has yet to be discovered. What is your reaction to that point of view?
A: Data definitely will be a key part of every business’s future success, and particularly within the financial community.
Unlike a limited resource such as oil, however, the amount of data is growing all the time. Because of this, being able to access the information you need, manage it effectively and analyze it properly to turn data into insight is going to get harder, and the demands and expectations of regulators, customers, and other stakeholders also will grow.
Success in the securities industry will mean a ruthless focus on data. You need the data to be accurate and trusted along with the technology to support and interpret in order to solve the most pressing challenges.