ISDA Chief Executive Officer Scott O'Malia offers informal comments on important OTC derivatives issues in derivatiViews, reflecting ISDA's long-held commitment to making the market safer and more efficient.

In a highly uncertain economic environment, it would be easy to assume that financial institutions should put technological investments to one side and focus on navigating other pressing challenges. In fact, the reverse is true. With mounting pressure on costs, using technology to create efficiencies can have a positive impact on the bottom line. That’s why ISDA is currently developing a plan that will set a clear course for our digital strategy over the next three years.

This is the next step on our digital journey, and it follows the development of a raft of mutualized platforms and services that have successfully digitized critical processes in the derivatives market. From ISDA Create that facilitates the negotiation and execution of flagship derivatives documents to the award-winning Perun quantitative analysis platform that underpins our capital benchmarking initiative, ISDA’s digital solutions have been developed in close collaboration with our membership to reduce risk and create efficiencies.

We also developed the Common Domain Model (CDM), a free-to-use data standard for financial products, trades and lifecycle events, which has been effectively deployed to digitize regulatory reporting and key collateral management processes. Thanks to our collaboration with the International Capital Market Association (ICMA) and the International Securities Lending Association (ISLA), the benefits of the CDM have also been extended to bonds and securities finance markets. Last week, we held a sell-out event in London with ICMA and ISLA to showcase the different ways in which the CDM is being used. It was great to see so much energy focused on the transformative potential of the model.

Now it’s time to take stock and consider what comes next. As part of our strategy to develop a new data and digital roadmap, we’re conducting a survey to understand the priorities of our members. If you’ve received the survey, I would strongly encourage you to complete the parts relevant to you, as every opinion counts. We’ll then follow that with a deep-dive discussion with key stakeholders to gather intelligence and test digital ideas across front-office, risk, operations, technology and legal functions.

This comprehensive outreach process is being conducted with some deliberate objectives in mind. We need to identify the business priorities and regulatory requirements that may require changes to the market infrastructure in the years ahead. We also need to carefully assess the digital experience of market participants to find out where the common challenges lie and what further data and digital solutions may be needed across the derivatives lifecycle.

It’s only through deep engagement that we can tailor our data and digital roadmap to the current and anticipated needs of market participants. We want to understand from a cross-section of the market how existing solutions are being used, where improvements could be made and what additional challenges may need to be addressed. This could lead us to develop new solutions, to fine tune what we already have, or a combination of both.

I’m looking forward to reviewing the intelligence that is gathered from our outreach and moving to the next stage in the development of our roadmap, with confidence that it reflects the requirements of our diverse membership. We’ll share further updates as we progress with this important initiative.

Documents (0) for Continuing Our Digital Journey