New Data Quality Management Program, Introduced by GLEIF, Optimizes Integrity of Legal Entity Identifier Data Pool

First monthly report demonstrates the high level of data quality in the Global Legal Entity Identifier System to date

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On 9 February 2016 the Global Legal Entity Identifier Foundation (GLEIF), the body responsible for ensuring the operational integrity of the Global Legal Entity Identifier (LEI) System, launched its data quality management program. Based on a set of clearly defined criteria, the program allows the quality of the LEI data pool (the publicly available information on legal entities identifiable with an LEI) to be monitored, assessed and further optimized. The first monthly report, summarizing results of the quality assessment as of the 31st of January 2016, reflects the very high level of data quality already achieved in the Global LEI System.

This blog post describes the principles governing the GLEIF data quality management program. The links to the first monthly report and further background material are included in the ‘related links’ below.

GLEIF defined a set of measurable criteria to clarify the concept of data quality with regard to the LEI data population

The Financial Stability Board (FSB) has reiterated that global LEI adoption underpins “multiple financial stability objectives” such as improved risk management in firms as well as better assessment of micro and macro prudential risks. As a result, it promotes market integrity while containing market abuse and financial fraud. The FSB also stressed that LEI rollout should support “higher quality and accuracy of financial data overall”.

The LEI connects to key reference information that enables clear and unique identification of legal entities participating in financial transactions. The reference data provides the information on a legal entity identifiable with an LEI. Simply put, the publicly available LEI data pool can be regarded as a global directory that greatly enhances transparency in financial markets. The data pool’s ability to meet this objective relies on the availability of trusted, open and reliable data.

The process of maintaining LEI data quality starts with the registering entity. Through self-registration, the registering entity must supply accurate LEI reference data. The LEI issuing organization (also referenced as ‘Local Operating Unit’) must then verify the LEI reference data with the local authoritative source, e.g. a Business Register, and issue an LEI compliant with the LEI standard. Once a legal entity has obtained an LEI, it will be published together with the related LEI reference data by the Local Operating Unit that has issued the LEI. Each Local Operating Unit publishes daily an updated file including all LEIs it has issued and related reference data. The ‘Common Data File Format’ defines how LEI issuing organizations report their LEI and LEI reference data. GLEIF has published the Global LEI Index, which provides information, also updated daily, on all LEIs issued to date.

GLEIF is responsible for monitoring and ensuring high LEI data quality. To clarify the concept of data quality with regard to the LEI population, GLEIF has defined, in close dialogue with the LEI Regulatory Oversight Committee and the LEI issuing organizations, a set of measurable quality criteria using standards developed by the International Organization for Standardization (ISO). These include criteria such as the completeness, comprehensiveness and integrity of the LEI data records. Instituting a set of defined quality criteria establishes a transparent and objective benchmark to assess the level of data quality within the Global LEI System.

Using software developed by GLEIF, the LEI data records made available by the LEI issuing organizations are checked daily against the defined quality criteria. These checks identify, for the time being, whether the data records are consistent and plausible. Also on a daily basis, GLEIF sends a report detailing the results of the performance assessment to the LEI issuing organizations.

In addition, GLEIF has developed a methodology to score the quality level of LEI data. The score represents the percentage of all LEI data records that successfully passed checks against the defined quality criteria during the reporting period.

The GLEIF website contains detailed information on the GLEIF data quality reports, including: quality criteria and associated definitions; checks performed; and the methodology used to derive the LEI Total Data Quality Score (see ‘related links’ below).

GLEIF published its first monthly data quality report summarizing results of the quality assessment as of the 31st of January 2016

GLEIF initiated the process of evaluating the quality of the LEI data pool in Q4 2015 with regard to seven out of twelve defined quality criteria. On 9 February 2016 GLEIF published its first monthly data quality report summarizing results of the quality assessment as of the 31st of January 2016. The report demonstrates the very high level of data quality achieved in the Global LEI System to date. In January 2016, the LEI Total Data Quality Score was 99 percent out of a possible 100 percent.

The monthly reports provide the following aggregated information identifying the overall data quality within the Global LEI System:

• The LEI Total Data Quality Score for the reporting period.
• Progress achieved with regard to the continuous optimization of the data quality within the Global LEI System based on the LEI Total Data Quality Score.
• Results of GLEIF checks of the LEI data records against implemented quality criteria, i.e. the percentage of records that successfully passed the tests.
• The five LEI issuing organizations that delivered the highest data quality in the reporting period.
• The five countries where the highest quality of LEI data records was achieved in the reporting period.
• The percentage of LEI data records, which meet the requirements of distinct quality maturity levels. The following maturity levels apply: Level 1 – ‘Required Quality’ (must be 100 percent for all data records); Level 2 – ‘Expected Quality’ (should be 100 percent); Level 3 – ‘Excellent Quality’ (the higher the better).

The data quality reports support the following objectives:

• Any interested party can clearly and easily identify the reliability of the LEI data.
• The reports inform about the continuous improvement of data quality in the Global LEI System based on the measurement of clearly defined quality criteria.

The reports are available for download on the GLEIF website (see ‘related links’ below).

GLEIF focuses on further enhancing the reliability and usability of LEI data to benefit users across the global marketplace

The introduction of the GLEIF data quality management program ensures that the LEI remains the industry standard best suited to providing open and reliable data for unique identification management. In cooperation with the LEI issuing organizations, GLEIF focuses on further enhancing the reliability and usability of LEI data to benefit users across the global marketplace.

Going forward, the GLEIF data quality management program will continue to evolve by gradually implementing previously defined quality criteria and corresponding controls.

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