At the start of ISDA’s 40th anniversary year, IQ convened the pioneers of the association to reflect on how a desperate need for standardization in the early days of the derivatives market brought dealers together to develop a dictionary of common terms. Those industry veterans were clear that ISDA’s enduring commitment to standardization has enabled it to support the continuous evolution of the derivatives market over the past 40 years.

As a year of celebration and reflection draws to a close, it’s time to look ahead to what the future might hold for the derivatives market, and how ISDA will help market participants navigate the challenges and opportunities that lie ahead. While it is never easy to predict the future with any certainty, it’s clear that the coming years will see the growth of derivatives trading in emerging market and developing economies, continued regulatory scrutiny of the non-bank financial intermediation sector and the rapid development of advanced technologies.

ISDA has been focused on the digital transformation of the derivatives market for several years, having assembled a powerful set of mutualized industry solutions to bring greater efficiency to key processes. These include the Digital Regulatory Reporting initiative and the ISDA Notices Hub, which launched in July. Efforts to realise the benefits of tokenization to bring greater choice and flexibility to collateral management are also now gathering momentum.

This final anniversary edition of IQ brings the last instalment of ISDA’s 40th anniversary timeline, covering the very busy decade since 2015. It also includes an interview with ISDA’s chair, Amy Hong, and a series of contributed articles from ISDA board members, policymakers and market participants on key trends that are expected to dominate derivatives markets in the coming years.

One of the defining themes of ISDA’s first four decades has been the relentless campaign for the enforceability of close-out netting, which is a fundamental step in the development of vibrant and resilient derivatives markets. It is fitting that in ISDA’s 40th anniversary year, Saudi Arabia became the last of the G-20 nations to recognise netting in law, marking an important milestone in its own right.

Click on the attached PDF to read IQ in full.