RDUG Opens Doors To Vendors As Reuters Scales Back STP Programme

Blog entry

The Reference Data Users Group is opening its doors to more vendor participation, moving away from the perception that it is a Reuters-led organization. In large part this is due to Reuters abandoning its high profile STP Programme and with it the team led by RDUG figurehead Tony Kirby.

Despite leaving Reuters, Kirby is still involved in the RDUG efforts (see The Interview, page 10) and presented at a recent RDUG meeting at the beginning of this month. The meeting was attended by some 30 vendor representatives interested to hear how they could play a role in the industry’s focus on the importance of reference data.

Also presenting at the event at IBM’s South Bank facilities was Nigel Solkhon, senior consultant at IBM Global Financial Markets and chairman of the RDUG Vendor Committee, and Stuart McKinlay of State Street, who chairs the ISITC – International Securities Association for International Trade Communication – European Executive Committee.

Solkhon tells Reference Data Review that the response from vendors has been “broadly positive” with a number of issues identified across the board, and supportive of the proposed initiatives outlined in RDUG’s White Paper, presented to the meeting by Kirby.

“It was a first meeting, but the good reaction that we got leaves me feeling confident that we can move forward,” Solkhon said. “Clearly there are some issues that have to be addressed, but I’m comfortable that we can make progress.”

One key area that found favour with many was the practical approach that RDUG is proposing – one section of the White Paper is titled “Take bite-sized chunks” and warns: “Going forward, we require quick wins that show early return on investment rather than big initiatives, for which it is typically hard to provide and retain momentum – SIA and T+1 is a good example”.

“It has to be practical,” says Solkhon. He says that one area that was clearly of interest to all parties was the definition of a Legal Entity Identifier (LEI) code. As a practical exercise it has been decided to create a sort of thought experiment by taking an existing fund as an example, allocating an LEI and “walking through the process from quote to settlement”, says Solkhon. “It will quickly show up where the weak points are, such as regional differences, and how they might be addressed.”

Other areas of general concern included issues such as counterparty identification and description of process mapping between vendor systems. “What we are seeing is a move away from the straightforward standards debates that have been going on for years and moving into the areas of business processes and validating business rules,” says Solkhon.

Vendors canvassed by Reference Data Review generally echoed Solkhon in welcoming the initiatives and pledging support. Some commented that the meeting had taken place just a few days after Reuters had closed down its Global STP Programme, of which Kirby was head. “There was inevitable comment among the other vendors, but on the other hand it meant that any suspicion that the R in RDUG stood for Reuters was removed, and that made some more comfortable,” says Ian Hillier-Brook, director of the Market Information Server division of Moneyline Telerate. “We are all looking to co-operate in this area. It will take time, but there is a need for an organisation like RDUG to give us the necessary drive.”

Kirby continues to act as secretary to RDUG, while Reuters is still represented by the continuing attendance of Christopher Smith, who was one of the co-authors of the White Paper presented to the meeting. “It’s not an issue,” says Solkhon. “In my experience – which includes 16 years’ involvement with ISITC – people leave their company bag at the door on these occasions. It’s a mix and match of people, and obviously there are some corporate issues, but that is what all of us are trying to address.”

The outcome of the meeting will be presented to the general membership of RDUG in London next week ahead of a joint meeting of RDUG and the US Reference Data Coalition in Boston at the end of March.