The Standards Forum Heads to Amsterdam

While Sibos 2008 was happening during one of the most memorable weeks of the financial crisis, and last year’s conference was about the recovery, this year seems to be all about looking ahead and moving on. And this is also true for the Standards Forum, the standards section at Sibos, which is this year held in Amsterdam.

In past years, some of the key themes in the Standards Forum have revolved around explaining the benefits of standardization to the wider industry, but while this year’s educational sessions will ensure this is still on the agenda, the Forum in Amsterdam will also take it one step further, focusing on best practices and facilitating the process of standards implementation.

La Hulpe, Belgium-based Alexandre Kech, head of securities and alternative investment standards, Swift, says he expects one of this year’s main areas of focus to be on enabling the implementation of standards. It is no longer about building standards in a collaborative way, but about making sure the standards are implemented and implementable, he explains.

New York-based Karla McKenna, director, Citi, and chair of the ISO Technical Committee for FS (TC 68), says the forum this year is also about explaining the development process that leads to the creation of standards. “The forum will also focus on the practicalities of how we have reached the point we are at now, and where we are going,” says McKenna, who will be speaking at the forum’s Going beyond the standards inner circle session on Tuesday.

Collaboration between standards bodies, now more of a reality than in past years, also promises to be a topic of discussion. “While in the past, collaboration of standards bodies was more of a wish, it is now a reality,” says Kech, who adds that there is now joint submission for ISO 20022 standards for collateral management between financial products language (FPL), financial products markup language (FPML)and Swift, for example. We are also pushing for open standards internationally.

This push has also been aimed at regulators. Kech says Swift has actively promoted open standards, such as ISO standards, at the regulatory level. “Last June, we headed over to Washington, DC to meet with the regulators to promote the use of open standards, and explain that all their regulation can only be efficient if they promote the use of industry standards as opposed to proprietary standards,” he says, adding that Swift is also planning similar meetings with the European Commission after Sibos.

And while collaboration remains key, efforts to facilitate the standards management for users is also high on the agenda. Swift, in fact, is currently launching “MyStandards,” an initiative aimed at helping users manage standards and market practices around standards.

Kech says: “The idea is to have a central platform where customers and users of standards can load the existing standards and the market practice usage for those standards, for example, as well as compare them.” This is set to help users act quickly when there is a new standards release, identifying the changes they have vis-a-vis the changes to the standards, for example.

The aim is also to ensure the standardization debate becomes more mainstream. “We have to make sure the standards discussion does not remain in a little circle of experts, and that people outside also understand it is something important. It’s about making it, using it and [appreciating] the cost reduction it can bring,” explains Kech.

In some cases this message is already starting to filter through. McKenna says some professionals from other parts of the industry are starting to see the work that has been done in the standards space. This has resulted in more practitioners realizing that applying these standards can help them achieve their own goals, even if they are from other parts of the industry. “We are looking at either existing standards, or revisions of standards, and possibly even some new standards, and we are already receiving feedback from some new stakeholders in the process,” she says.

Demystifying Standards
ISO 20022 & XBRL

Meanwhile, one of the most awaited sessions at the forum this year is expected to be the release of Swift’s ISO 20022 for Dummies, an introductory style book due to be released on October 26. The book aims to create awareness of ISO 20022 and ensure there is a greater understanding about the benefits of adopting the messaging standards, similar to what Swift’s publication 10 Simple questions about ISO 20022 aimed to achieve.

Swift’s Kech says the book is all about explaining what ISO 20022 really is about to the wider industry. “The aim is to demystify ISO 20022 and de-couple it from the XML syntax,” he says. “It’s a method for building standards, a data dictionary, and finally it has a preferred syntax, which is currently XML, but it doesn’t reject other syntaxes or protocols like FIX, XBRL or FpML trying to integrate these protocols into one picture,” he explains, adding that many, in fact, tend to think of ISO 20022 as XML only.

Boston-based Tim Lind, managing director, strategy, Omgeo and speaker in one of the sessions about ISO 20022, says he has seen the discussions around ISO 20022 developing from theory into practice.

“Discussions around ISO 20022, especially on the securities market, used to be much more theoretical at the time Swift was trying to discuss the value of 20022,” he says, adding that this was mainly because firms had not yet started to invest in applications to adopt ISO 20022 messages.

The industry is now looking at how to manage ISO 20022 and making it more of a reality, looking at what is the practical reality of implementing those message types, and what it will bring in terms of value, says Lind, adding that at this stage he thinks many firms are still facing challenges to explain why they would become an early adopter of 20022 and the practical implementation of it.

In the Limelight

Certainly, ISO 20022 will be in the limelight at Sibos, and at first glance it may even seem as though it will overshadow the XBRL discussions, which became some of the highlights at Sibos in Hong Kong last year, and in Vienna the year before. But XBRL is still very much on the agenda in the 2010 program. “This time around, it is more about showing the outcome of our efforts,” says Kech, adding that there will be one session about demonstrating how the tagging process works, and one looking at whether XBRL has been successful and should be used in areas other than asset servicing.

“I think it’s a good opportunity for the people who haven’t been involved in development around XBRL to be made aware of where the initiative is right now,” says ISO’s McKenna. “When we identified this initial area in the financial services industry for application of XBRL, it was always agreed that we would continue to examine other business processes to which XBRL could be applied to,” she adds

So far, corporate actions continues to be the main contender for XBRL tagging. The idea is that issuers could use XBRL when creating the corporate actions announcements, but the pros and cons of this continue to be up for debate.

Stockholm-based Christine Strandberg, global product manager, asset servicing, SEB, who is also a speaker in the eductaion session at the Standards Forum, remains skeptical when it comes to XBRL. “I would really prefer the issuers to use ISO 20022 issue agent communication messages,” she says.

The debate promises to develop further this year. In the meantime, experts hope the Standards Forum at Sibos in Amsterdam will reach its goal of bringing the efforts, challenges and accomplishemntes around standardization to the forefront while promoting the benefits of adopting standards to the overall industry.

Meet the Locals

Inside Reference Data asks leading reference data professionals based in this year’s Sibos city, Amsterdam, to give conference-goers travel advice for a week in the Venice of the North

Name: Jop Boonstra

Company: Contractor, ABN Amro Bank

Number of years lived in Amsterdam: 18

Favorite restaurants: Café Loetje, Eetkamer van de Jordaan, Chez Georges and Chiel Blue

Best business lunch restaurants: Dickys Grand Cafe and Vis aan de Schelde

Best place to visit for a break: Vondel Park

The local secret: Amsterdam is a very green city with many trees and parks. Getting ‘out of the city’ can sometimes just be done in a few minutes. One example is to go for a walk (or bicycle ride) along the Amstel river, which is just a 15-minute walk from the Sibos venue. Another local secret is Café Nol, a traditional Amsterdam Café with Dutch music for a final drink after a late night out

Musts for out-of-towners: To go for a jenever at Café Hoppe

Name: Martijn Groot

Company: Director, market strategy, Asset Control

Number of years lived in Amsterdam: 13

Favorite restaurants: le Zinc et les Autres at 999 Prinsengracht, and “de tropen” in De Jordaan (Palmdwarsstraat)

Best business lunch restaurants: Places near the World Trade Centre, such as de Delikeet (Willem van Weldammelaan 4)

Best place to visit for a break: The little church hidden in the attic of a canal house (Museum Ons’ Lieve Heer op SolderMuseum Ons’ Lieve Heer op Solder) Oudezijds Voorburgwal 40, and het Vondelpark (weather permitting), a perennial classic to get some air

The best place to visit in a 30-minute break: The unexpected tranquility of the Begijnhof with the 17th century English Reformed Church right next door to Kalverstraat, the main shopping street

The local secret: Brouwerij ‘t IJ in the old mill at Funenkade 7. I think they make the best beer in Amsterdam

Musts for out-of-towners: Renting a waterbike and touring the canals, or take a normal bike and cycle through town trying to avoid taxis, trams and tourists. If you have a bit more time, cycle out of town into the meadowlands and enjoy the scenery of Waterland, just northeast of Amsterdam.

Name: Martijn van Lunteren

Company: Subliem Effect (formerly ABN Amro and RBS)

Number of years lived in Amsterdam: 4

Favorite restaurants: The good solid restaurants Merkelbach, Wilde Zwijnen, Van de Markt; the more trendy, edgy and hip-and-happening Open, and Pompstation; the more underground, in terms of the setting, Noorderlicht, Trouwamsterdam and Lab111 / Smart project space.

Best place to visit for a break: Check http://www.atcb.nl/en-home

The local secret: A walk through the ancient part of Amsterdam: De Jordaan, and a visit to Het Begijnhof (http://www.begijnhofamsterdam.nl/index_engels.html)

Musts for out-of-towners: The standard canal tour, and a visit to one of the famous museums