I would furthermore add to that call the need and importance of CEOs in the private sector to address an even more compelling need for improved risk management of not only their individual firms but also the financial system the following: standardization and harmonization of the financial data across business silos within the firm.

The work to implement enterprise-wide data standards should go forward aggressively without succumbing to the temptation to “wait and see” what kinds of financial data standards are eventually handed down from regulators.

Also this may sound like cart-before-the-horse, establishing firm-wide data standards is important for the following reasons:

1. Regulators are not in the position to unilaterally establish wide-ranging financial data standards – nor should they be. The preferred strategy of government regulators, and organizations like the Office of Financial Research, is to work with the private sector to establish such standards. The relative complexity of that task is beyond the scope and skill set of a single regulator or group of regulators.

2. The process of establishing the standards for regulatory reporting, at some level of detail or aggregation, is a process that may or may not impinge on internal financial data standards within a firm.

3. By forging ahead with internal data standards across the enterprise, CEOs will put their firms in a position of being able to map to whatever regulatory reporting standards do eventually emerge down the road. Waiting for such regulatory data reporting requirements to be finalized before initiating steps to comply will only put a financial institution behind the proverbial 8 ball.

4. There is no need for a single, universal data standard for internal firm data — any number of schemes can be implemented as long as they are consistent and address the full scope of balance sheet financial data within the firm. Market data feeds and other external sources of data of course need to follow industry-wide standards, but there is no such requirement to do so with a firm’s internal data such as customer positions and contracts on the balance sheet of the firm.

A two-pronged approach is needed: support progress on financial industry standards common to the industry, and, in the meantime, proceed to implement standardization of data in the arena that is under the direct control of the CEO: the data within the firm. This is the best, and probably only, path to accomplishing the complete objectives and aspirations of better institutional as well as systemic risk management.