The necessity of standards may not seem like a point for contention, but at Sibos 2025, the session titled “Why standards matter – a discussion with the ISSA board” turned it into one. Perhaps surprisingly, as the panel discovered, it was a much needed conversation, given the technological and geopolitical challenges the industry currently faces.
“I’ve started to hear people say, ‘Well, we don’t need to worry about standards anymore because AI will solve all the problems for us, right?’” shares Paul Maley, global head of Trust and Securities Services at Deutsche Bank. “That’s a terribly dangerous comment… It is surprising already, where we are in the formative stages of AI, how often that comes up.”
Technology will do a lot, but never everything, for us. In fact, standards will have to be put in place to govern it, says Brian Steele. The managing director and president of Clearing and Securities Services at the Depository Trust and Clearing Corporation (DTCC) states, “It (technology) is an enabler but in some ways it will create more of a burden than otherwise exists today.” AI models will, for example, require maintenance, constant upscaling, and structural changes to be deployed at scale.
Adding to the urgency for good standards is the current geopolitical climate. “Standards come from levels of international collaboration which are getting a bit harder to do nowadays rather than easier,” says Maley. He believes that to tackle this, a bottom-up approach will have to be taken. “There’s a lot we can do as an industry for ourselves without needing to wait for someone to tell us to do it.”
No lack
Steele argued that the industry is not suffering from a lack of standards. Rather, there is also work in ensuring that those standards are applied. “Standards are only as good as they are adoptable, or how pervasive they are in terms of adoption,” he points out. “It is incumbent upon us as an industry to set the standards and create a value proposition for adopting.”
He continues, “There is no shortage of opportunity if we think about where we need to set standards, but equally, we need to double down on where standards already exist and think about how they can be applied in a commercially effective way.”
The overall tone of the discussion was, unsurprisingly, for standards – even if James Fok, chief commercial officer of CMU OmniClear Limited briefly played devil’s advocate with a caution on the risk of standardisation. “Standardisation can, in places, frustrate innovation. Quite often, standards are driven by the largest players in the market simply because they are the ones that have the resources to coordinate the players and lobby regulators. The benefits of standards have to be balanced against maintaining a level playing field and allowing for innovation.”
A journey
Margaret Harwood Jones, managing director and global head of Financing and Securities Services at Standard Chartered Bank summed up the discussion: “What are we here to do in the asset servicing world? We’re here to connect efficiently and effectively the issuer to the investor,” she points out. “We have a constant mission to take friction out of the system, which manifests in so many ways… Until you get the chain as tight and efficient as possible, you’re always grappling with that weakest link in the chain and we know better than that.”
“When you then portray that in the complexity of today’s external environment, to me that just says that the time is now. Yes, it’s on a journey. It won’t be solved overnight. There are continued challenges that will evolve. But for me, that just emphasises the urgency to have the right level of attention and working agenda around standards in the industry.”
