What Banking Finance Leaders in Australia taught me about modern CFOs.

I have always known the importance of data as the engine to successful business strategies, but recently it dawned on me that it is finance that holds the key. The realisation came after I attended a roundtable in Sydney with banking finance leaders. No doubt, finance, numbers, and data go hand in hand; no surprise here, but it is the sharing of data with people and helping them understand it to make sound decisions and strategies – that's the responsibility of CFOs. Beyond the bottom line, the modern CFO now has a hand in top-line growth strategies, risk management, and more.

Yet, when asked if their organisations deploy a single, integrated platform for data collection and management, 78% said No. 

I noticed there was consensus in the room that accurate and robust data is crucial. Years of working with banks showed me that clean data requires data lineage across the organisation with vigorous reconciliation and validation; or simply put, the banks need a single integrated platform to manage their data. So why are they not having such an architecture in place?

Challenges in implementing transformation

The reality is organisations are still managing a great deal of legacy technology. 'How do you build modern technology on top of legacy in an efficient way? What is the priority in terms of growth versus efficiencies? How do you deploy the technology to serve that purpose?' questioned an executive.

 Also, the difficulty of shifting mindset and obtaining buy-in from those higher up the ladder who are resistant to changes is very real. "They just want to continue doing what they are doing. They just want the technology to help them,' explained an executive. 'There was a technological acceleration. What would have taken us 10 years took us two or three. That balance is becoming increasingly difficult to attain.'

 Building Operational Resilience

 A view shared by leaders at the luncheon despite large investment in Risk Management and Compliance software, there was consensus that insights into the business are difficult to obtain, stress tests can take weeks to months to achieve.

 These sentiments shared by Wayne Byres, Chair of the Australian Prudential Regulation Authority (APRA) at a recent RMA Australia conference, set out his view of the key points of the regulator’s approach to operational resilience regulation. The need for Banks to build operational resilience inside their Organisations.

What is stopping Banks from building operational resilience?

Banks need to simplify Risk and Finance Data Architectures – to reduce the “Risk and Finance Data” complexity that currently exists today and rationalize to a future-proof data architecture. Banks need to eliminate de-duplication that legacy data silos have created through “best of breed”, Finance Managers need to have complete integrity and verifiable lineage in the data being reported to the internal stakeholders, auditors, and regulators alike.

Wolters Kluwer believe that a centralized data management approach is the foundational layer for an effective Risk and Finance data management framework that enables enhanced business insight and Risk & Finance analytics, whilst reducing cost and complexity when complying to the demands of both local and global regulators that adhere to the principles of CPG235 and BCBS239.

Of course, the discussions did not stop here. There were other intriguing topics such as, 

•  on the onslaught of inflation, do you charge customers more or become more effective, 
• a staggering 98% of budget is going to compliance, 
• the pressure of submitting inordinate amounts of data to regulators, 
• the social risks of falling out of public's good graces. 

 To find out more, you can read them from this post-event Insights Report.  

Author: Tom Jones