The integral role of data integrity in overhauling regulatory reporting; fail to prepare, prepare to fail

Data integrity at an organisational and industry level is vital for fully functional and efficient global capital markets. Good data integrity helps reduce systemic market risk, upholds regulatory standards, and enables firms to make better-informed investment and market decisions.

The acceleration of generative AI, and heightened demand for advanced data processes amid new regulatory requirements such as T+1, means high data quality becomes paramount. Without adequate preparations and tooling, those organisations that fail to adapt may fall victim to the new standards of data assurance demanded across the board at an industry level.

What’s more, regulatory practices are shifting in tandem with the advancements of new automation solutions, changing the face of data processing dramatically. Organisations must respond to these changes, and ensure a smooth transition to T+1, or risk being left in the dust of their competitors.

The rising demands placed on data integrity standards is leaving many organisations in the capital markets, particularly small to mid-sized firms feeling under-resourced and overwhelmed by the burden placed on new regulatory requirements. Gresham Technologies' recent research report with TORI Global demonstrates that one action can be undertaken to prepare for the shifting industry standards; ‘focus on the data’.

The problems caused by the changing nature of technology

The results of this paper tallied the opinions of senior professionals from diverse sectors, including investment banks, life insurance firms, asset managers, and others. The findings demonstrated that the shifting technological, regulatory, and financial landscape means senior managers must deliver more products and higher-quality data while adapting to a fragmented technology infrastructure.

Adjusting to heightened levels of automation may also cause problems. Poor and inconsistent data will have a knock-on effect as Robot Process Automation (RPA) becomes increasingly sophisticated. Robots and AI using compromised information means the ripples caused by low-quality data turn into tidal waves.

Addressing the problem at source is the only way financial service firms can ensure the seamless integration of new technologies and regulatory practices. Focusing on anything other than the data in this context is unproductive, and potentially damaging.

Adapting to change is a step-by-step process

Focusing on better data integrity means enterprises address the changing nature of technology and regulation, facilitating the necessary adaptations needed to function.

By better understanding data through assessment, reconciliation is reduced and regulatory requirements can be better adhered to. Only then can automation, AI, and other new technological tooling be implemented. As the role of automation increases, manual interaction with data sets reduces, and the process becomes more streamlined, efficient, and effective.

Starting with the data, allocate the necessary resources to ensure data integrity, and become better equipped to shift to a faster and more robust processing standard.

Do not be distracted by the technology hype

From the Gresham Technology and TORI Global paper, it is clear that senior management of the world’s leading enterprises is under immense pressure to better understand the changing regulatory and technology landscape. This can fuel an unproductive reaction to allocate money and resources to understanding these changes. This is the wrong approach.

Enterprises of all scales must put this time and energy into ensuring the integrity of their data. If RPA technologies or AI are presented with incorrect information, by the time T+1 comes around, businesses will be forced to tear everything apart and start from scratch. Focus on the data, and everything else will fall into place.

To learn more about how your organization can focus on the data, download the Gresham partnered research report with TORI Global, and check out Gresham Technologies' myriad of products designed to ensure data integrity.

* Jennifer McMackin is the Global Director of Customer Success at Gresham Technologies.