Today, no serious conversation about future business models is complete without reference to data analytics, artificial intelligence (AI) and data-driven insights. However, as use cases for data have grown, so too have concerns over its ethical use. Today, Chief Data Officers (CDOs) and other data leaders are just as likely to be asked “should we do it” as “can we do it” when it comes to assessing new data applications.
However, while issues like privacy and responsible AI are garnering a great deal of attention, other areas of ethical data use are being largely ignored. One such is around the extent to which firms remain within the terms of their data licenses.
In the investment management sector, data vendors – who are the IP owners of operational data – license their data to firms for specific use cases and under strict conditions around who is allowed to access the data and how long for.
Firms that sign up to these licenses undertake an ethical obligation to understand the terms of their licenses and to put in place measures to ensure these terms are respected. These tasks can be a challenge, however. Licensing contracts are highly complex and can be difficult to navigate even for seasoned experts. What’s more, firms often lack the ability to manage what end users do with the data once they’ve received it. A person may be given legitimate access to data for a specific use case only to use it for something else, or to pass the data on to a colleague who does not have permission to use the data.
David Toomey-Wilson, Senior Vice President at RIMES Technologies, comments: “Firms want to get data governance right, and not just to be prepared for the inevitable data audit by the IP owners. The rise of ESG investing shows there is an appetite to be good corporate citizens and to be ethical in all practices.
“When it comes to governance, data teams need to put in place policies and controls to ensure that data usage is in accordance with their license agreements. This can be a challenge for teams that are focused on sourcing, mastering and validating data – with all these time-consuming tasks to get through, time can often run out when it comes to ensuring sufficient controls are in place around distribution.
“Managed service providers like RIMES can help. As long as relevant data licenses are in place, we can take care of the time-consuming data management tasks, so internal data teams can focus on getting that data to where it’s needed and policing their policies and controls. We also provide complete source-to-system visibility, so we can help firms see exactly who uses the data right up to the moment it hits their end user systems.
“However, having the right governance processes, procedures and supporting technology is only part of the answer. It is also vitally important that firms build a corporate culture that stresses the importance of ethics. That can only come from the direction set by the leadership and by education and awareness campaigns.”
RIMES Managed Data Services is a proven data operating platform that helps firms of all sizes and in all regions align their data consumption closely with business needs. Contact us to learn more.
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