The LEI (Legal Entity Identifier) is a great idea and a much needed data standard for the financial world. However, uptake has been slow and few of the planned benefits are being realized. What can be done to turn the situation around?
Steven Goldstein says the regulators have to take control. Today, LEI adoption is federated and bottom-up. Adoption would increase if regulators made it mandatory – or, interestingly, if they paid organizations to comply. Goldstein says they could use funds from regulatory penalties to provide the incentives.
The idea of recycling penalties into incentives is nice. We probably also need to be realistic about priorities. Maybe financial organizations see the benefits of the LEI, but place the necessary action low down their to-do lists. Regulators must see data standards very differently. They may have to bite the bullet and make it easier for businesses to do the right thing. TABB
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