The Role of Big Data in Governance: A Regulatory and Legal Perspective of Analytics in Global Financial Services

54 Pages Posted: 23 Mar 2016

See all articles by Daniel Gozman

Daniel Gozman

University of Reading - Henley Business School

Wendy Currie

Audencia School of Management

Jonathan Seddon

Audencia Nantes School of Management

Date Written: December 1, 2015

Abstract

This paper discusses how global financial institutions are using big data analytics within their compliance operations. A lot of previous research has focused on the strategic implications of big data, but not much research has considered how such tools are entwined with regulatory breaches and investigations in financial services. Our work covers two in-depth qualitative case studies, each addressing a distinct type of analytics. The first case focuses on analytics which manage everyday compliance breaches and so are expected by managers. The second case focuses on analytics which facilitate investigation and litigation where serious unexpected breaches may have occurred. In doing so, the study focuses on the micro/data to understand how these tools are influencing operational risks and practices.

The paper draws from two bodies of literature, the social studies of information systems and finance to guide our analysis and practitioner recommendations. The cases illustrate how technologies are implicated in multijurisdictional challenges and regulatory conflicts at each end of the operational risk spectrum. We find that compliance analytics are both shaping and reporting regulatory matters yet often firms may have difficulties in recruiting individuals with relevant but diverse skill sets. The cases also underscore the increasing need for financial organizations to adopt robust information governance policies and processes to ease future remediation efforts.

Keywords: big data, governance, compliance analytics, regulatory conflicts

Suggested Citation

Gozman, Daniel and Currie, Wendy and Seddon, Jonathan, The Role of Big Data in Governance: A Regulatory and Legal Perspective of Analytics in Global Financial Services (December 1, 2015). SWIFT Institute Working Paper No. 2014-0009. Available at SSRN: https://ssrn.com/abstract=2752561 or http://dx.doi.org/10.2139/ssrn.2752561

Daniel Gozman (Contact Author)

University of Reading - Henley Business School ( email )

Greenlands
Reading, Henley on Thames RG6 6AH
United Kingdom

Wendy Currie

Audencia School of Management ( email )

8 Route de la Joneliere
Nantes Cedex 3, 44312
France

Jonathan Seddon

Audencia Nantes School of Management ( email )

8 Route de la Joneliere
Nantes Cedex 3, Cedex 3 44312
France

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