Buy-side firms can potentially derive significant benefit from establishing the proper data governance framework.
However, at a time when companies in this space are facing myriad pressures and are making an effort to fulfill numerous objectives simultaneously, giving this matter the due diligence that it deserves can be challenging.
At the recent European Summit in London, several market experts noted that when attempting to set up the right information policies and procedures, it is crucial to have a strong business case, according to Buy-Side Technology.
Data governance frameworks can create many benefits
Many companies are well aware of the value that lies in establishing a proper data governance framework. By putting forth the needed due diligence, companies can potentially obtain higher-quality information. This, in turn, can potentially help fuel better-informed decision making.
Julian Dorado, head of data management at London-based M&G Investments, spoke to the importance of having high-quality information at the European Summit, the media outlet reported.
“In our business, we saw that badly defined data could lead to incorrect investment decision and that is our main concern,” Dorado told the media outlet. “We are looking to use data governance to lower those potential risks and make sure the data we are using is fit for purpose.”
In addition to ensuring that information is high-quality, having the right data governance framework can help eliminate many different compliance headaches that firms could encounter otherwise. Market participants are currently making an effort to navigate a regulatory environment that is both intricate in nature and also fraught with uncertainty.
The current framework of rules and regulations could change at any time. Many key reforms have been enacted in the last several years, and industry representatives and lawmakers are proactively making efforts to alter the current framework either by introducing legislation or taking action through the court system.
Key role of a business case
Even amid all the benefits that companies can potentially obtain by establishing the right data governance framework, people who advocate having these information policies and procedures must keep the importance of a good business case in mind.
The basic purpose of any company is to maximize profitability, so any decision makers working for a firm will keep this basic premise in mind when determining where to devote the resources of an organization.
At the industry event, the heads of data management working for many different companies weighed in on the situation, taking some time to elaborate on the specific challenges they have encountered. Dorado noted the challenges that his firm encountered in its efforts to get top executives on-board.
“We would struggle to get the senior management to attend a meeting called ‘data governance,'” the market expert told the news source. “But if governance is not business-driven, it has every chance of failing. You need to find a way to make it a concrete strategy for the business people as well as for the IT team.”