To All Open Symbology Skeptics (including my former self)

“I’ve already fixed the problem. Why do I need a new identifier?”

“Why are you confusing the industry with Yet Another Number? Don’t we already have enough?”

“You’re fragmenting an already fragmented problem.”

 Joining Bloomberg ‘s Open Symbology effort was not something I jumped into lightly. I’ve never taken job changes lightly, but with this particular move, I was particularly focused. I had finally found out what I wanted to do with my life. Data had been part of things I’d done all along my career, but suddenly, data was cool. Data was at the forefront. Firms finally seemed serious about data, not as a necessary evil, but as an asset.

So – what did I want to do? What it came down to was the opportunity to finish work I began 15 years ago, and at the same time make a positive impact on the industry I’ve worked in for 25 years, that would last beyond whenever I’m finally able to retire.

It is no secret that, in the past, I had publically dismissed what was then the ’Bloomberg Global Identifier (BBGID)’. I saw it as proprietary, and somewhat aimless in purpose. So what changed? How did I, a BBGID skeptic, end up at Bloomberg advocating the adoption of the reimagined standard, the Financial Instrument Global Identifier (FIGI)?

A key factor was the work Bloomberg initiated with the Object Management Group (OMG). Suddenly, this was no longer a ‘Bloomberg’ identifier, but a burgeoning standard. But surely Bloomberg would change the rules once critical mass was reached? No, there is a simple legal document in place that gives rights in perpetuity. There are efforts underway to create an independent infrastructure to manage the FIGI, associated metadata, and data request service. ISO is being petitioned to open a dialogue into registering FIGI as an ISO standard, complete with the rules and mandates ISO imposes. All these points spoke to a real sincerity in the effort to address an industry problem.

I’m not blind nor naïve – there are, of course, fringe benefits to creating such a standard– reputational and otherwise. But the key differentiator of Bloomberg’s approach to the FIGI is that the company benefits take a back seat to the primary goal of supporting a global industry standard. If I was not convinced of that, I would not attach my name to this effort.

So with all of that said, how do I address the questions that I’m continuously asked by clients, friends, standards colleagues, and – yes – “competitors”. 

Day to day, the financial industry would have ground to a halt if every firm hadn’t figured out a way to uniquely identify entities and instruments within their systems. Some do it better than others. Some look like they do it better than others. Some do it old school, though force of will, and others have a slick, company-wide unique number that gets assigned to everything from employees to stock items.

So, why does anyone need a new identifier? Because – a firm is not a firm unto itself (to borrow horribly from the old saying). The nature of financial services is to do business with others. Being able to speak the same language is key. Just as firms found it important to create a singular unique identifier internally, the same driver should have them racing to adopt a single unique identifier throughout the industry at large. After all, the industry as a whole is just an extension of each of the firms within it – why would the same principals not apply?

OK – but don’t we have enough identifiers already? Why are we throwing yet another identifier in, instead of using what is already there? Quite simply – because every single identifier that has existed in the financial services industry to date has been created with a specific, mostly niche, purpose in mind. This is not an indictment. There is value in fit-for-purpose standards. But, there still needs to be some sort of glue that ties it all together – that can cross the procedural, hierarchical, operational, and other contextual divides that span those purposes.

This is not about creating a replacement for what exists, or “competing” with existing standards. It is about extending what most every senior data manager has already realized and implemented in their own firms, and applying that to the industry at large, across asset classes and functional processes. Most people, on a day to day basis, will not see any need, use, or impact in regards to what they do in the narrow scope of their role.

Like the impact of rounding up to the nearest round number and putting those pennies (or shillings, cents, centimos, etc) in a savings account, the story here is the cumulative impact such a standard can have over time. Reduce your fails by one transaction a day; conservatively, double that every few years; increase your liquidity or collateral use efficiency by 0.5% every 6 months; beat your spread every 100 transactions by an extra basis point. Without doing anything different. Just because the quality of your data has increased, because your counterparties are keying off the same glue underpinning your inter-party transactions.

This is what I signed up for. This is the revolution. This is the disruptor that helps change the industry without disruption, without forcing everyone to change what they do and how they do it. Through evolution and the creation of context.

Rich Robinson