Open Link Financial, Inc., a solutions provider for the Transaction Lifecycle Management including Trading, Risk and Back Office, released some of the findings from a recent Oracle webinar which surveyed senior Energy and Commodities industry professionals focused on Governance, Risk and Compliance. The survey observed the importance of optimizing data, risk and compliance as well as the issues faced by these professionals in a continuously evolving regulatory environment.
During the survey, industry professionals were asked when they planned on purchasing or building a system for energy and commodities trading compliance, 61% responded that they were not evaluating any system.
“This data is not surprising, as industry participants have not, until now, been told what attributes to look for in a system. With the newly proposed financial regulations like the Commodity Exchange Acts and the Dodd-Frank Bill, technology must support firms’ compliance initiatives such as monitoring of trading and risk management procedures, real-time public reporting for transactions, consistent data element standards, and audit trail capabilities throughout the entire transaction lifecycle,” said Robert Kalish, Managing Director, Strategic Client Group of OpenLink. Mr. Kalish added, “Being able to evaluate the underlying workflow processes and data to support good decisions around these activities will be crucial in firms’ evaluating systems.”
Respondents were also asked which of the following scenarios best describes their current approach to monitoring trading activity. The professional traders and risk managers results were as follows:
• Packaged software solution (other than Oracle ETRM system) – 17%• Automated reports generated through the ETRM system – 18%• Manual, spreadsheet-driven process – 31%• A proprietary, custom-developed solution – 35%
“A rigorous approach to monitoring and surveillance of trading activity that generates meaningful alerts, enables efficient investigation and analysis, and streamlines the ongoing management and reporting of relevant information is key to a firm’s ability to meet more stringent regulatory expectations and achieve an operating environment that protects the firm’s reputation and customers,” said Bill Nosal, Head of Product Management, Governance Risk & Compliance, Oracle Financial Services Analytical Applications.
The survey was conducted in relation to an Oracle sponsored webinar entitled: Effective Monitoring for Energy Trading Behaviors of Interest. Participants included energy professionals in trading and risk management who want to optimize their institution’s approach to energy trade surveillance, assess and respond to new compliance demands driven by regulators or internal policies, and tackle today’s tactical risk and compliance problems while future-proofing compliance spend across regulatory mandates. Speakers included Michael R. Berry, Managing Member, MRB Consulting LLC; Deb Castaldo, Director – Market Surveillance, Citigroup Global Markets; Michael Lyons, SVP – Market Surveillance, Citigroup Global Markets; Robert Kalish, Managing Director, Strategic Client Group, OpenLink Financial and Bill Nosal, Head of Product Management – Governance, Risk and Compliance, Oracle Financial Services Software.
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