Getting the right underpinning governance isn't glamorous, but proponents say hashing out dry details will help unleash data's true potential.
A pending financial data standards bill could conceivably be law within a year, but its proponents are prepared to keep fighting the long fight.
"It took us five years to do the Data Act," said Hudson Hollister, executive director of the Data Coalition. "It's been one year so far for the Financial Transparency Act."
Backers of the Financial Transparency Act, which would direct regulatory agencies to standardize the information they collect from the private sector, were thick on the ground at the Data Coalition's second annual Financial Data Summit on March 29.
The bill has gained 29 co-sponsors, which Hollister said will prove a crucial part of getting the legislation before committees and eventually passed. He said a Senate companion bill should be introduced this Congress, but couldn't yet say who the sponsor would likely be.
And it's not all forward momentum for open data and data standard fans like Hollister.
As Hollister noted in a February blog post, the Small Company Disclosure Simplification Act passed the House despite opposition; that bill would exempt many U.S. companies from having to report financial information in machine-readable data formats.
But even that setback shouldn't hurt his movement much, Hollister said, as the package of which the bill is a part is unlikely to pass the Senate.
Proponents of "simplification" had a point, Hollister acknowledged, because, "frankly, the SEC has made a hash of the current open data reporting."
Under the current model, companies must supply reports in both machine-readable and plain text (often .PDF) formats, leading to duplicated work and a focus on the ultimately less valuable plain-text reports.
"We have to defend a flawed reporting requirement because of what we know could happen" if that reporting is improved rather than relaxed, Hollister told FCW. "And what could happen is data easily flowing from the financial markets through the agencies to investors; what could happen is better transparency, effective analytics, automated compliance."
To facilitate that data flow, Dick Berner, director of the Treasury Department's Office of Financial Research, has been working on a Legal Entity Identifier system that would help link financial institutions across myriad reports.
It's a clear place for government to step in, Berner said, because it's a "classic" public good problem wherein "costs are borne upfront" and benefits come later.
Berner said his office was working on other data standards with global partners, including a unique product identifier and unique transaction identifier, and pledged substantial progress on those two standards within the next 18 months.
Distributed ledger and blockchain technologies could also prove useful in tracking financial information around the world, Berner said, though he warned against banking on a particular nascent technology.
Throughout the day, financial data users from the Securities and Exchange Commission, FDIC and other public and private organizations noted how good, broadly adopted data standards could lead to a data nerd's nirvana.
A fully implemented LEI could shed light into the financial industry's tangled relationships and interdependencies, Berner said.
"Financial data standards should be mandatory," said Srinivas Bangarbale, chief data officer at the Commodity Futures Trading Commission, "because without them, data would be garbage."
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