LONDON, Thursday 16 February 2023 – The International Securities Lending Association (ISLA), the International Swaps and Derivatives Association (ISDA), and the International Capital Market Association (ICMA), have announced the open source availability of its highly anticipated Common Domain Model (CDM) project in partnership with FINOS (the Fintech Open Source Foundation). As an open collaboration within the FINOS community, this project represents a major milestone for FINOS and reinforces its commitment to fostering collaboration and innovation within the fintech industry. The CDM project offers a unique opportunity for members to collaborate and drive industry standards forward in a transparent and inclusive manner.
“Today represents the culmination of a lot of collaboration between the associations and FINOS. Placing the CDM within the FINOS community marks a watershed moment in the development of standards for the industry. Strategically, the open-source methodology should breed faster convergence, facilitate quick adaptation to future changes to capital markets requirements and attract a wider user base.” Said Andrew Dyson, ISLA’s Chief Executive Officer.
In September 2022, ISLA, ISDA and ICMA announced FINOS as the selected organization following a comprehensive Request for Quotation (RFQ) process. The CDM, now fully integrated into the FINOS project landscape, streamlines and automates lifecycle events and processes related to derivatives, fixed income and securities lending transactions, reducing costs and improving interoperability. The CDM promotes transparency and alignment in financial markets by producing consistent trade data, which enhances risk management and trade processing capabilities for industry participants.
“FINOS is very proud and excited to launch open collaboration on the CDM and to evolve the model to become the standard for financial objects and events modeling,” said Jane Gavronsky, Chief Operating Officer at FINOS. “This is the perfect time for the industry to double down on standards collaboration — progress in digitizing regulatory rules, advances in smart contracts, continuous demand for greater transparency from regulators, and last but not least mounting cost pressures in the current market, all point at the need to join forces across the industry, to increase interoperability via standard proliferation, and to “do more with less” by mutualizing development cost. We believe FINOS is best positioned to facilitate these next steps for the industry.”
“The launch of the FINOS project represents an exciting new chapter and will bring together a broad community of financial market participants to adopt and further expand the open-source CDM. This will ensure greater consistency and standardization in how derivatives, bonds and securities finance transactions are reported, managed and processed through the lifecycle, increasing interoperability and efficiency and reducing costs,” said Scott O’Malia, ISDA’s Chief Executive.
“The CDM is a strategic cross-industry collaboration between ICMA, ISDA, ISLA and FINOS. Today’s launch coincides with the completion of ICMA’s CDM project for repo and bonds. At a time of accelerating digital transformation, regulatory change, cost pressure and an increased risk of fragmentation, the FINOS open-source framework will be critical to facilitate adoption and promote interoperability across capital markets”, said Bryan Pascoe, ICMA’s Chief Executive.
FINOS has established itself as the arena of choice for financial services non-competitive open collaboration between the wide array of participants, including regulators, financial institutions, service providers, fintechs, and regtechs. FINOS has both the community and the open-source tools that will propel development and adoption of the CDM. In 2020, FINOS conducted a successful pilot program for submitting CDM model changes using Legend, its open data modeling collaboration platform, as demonstrated in the FINOS Legend Case Study. In addition, the FINOS Financial Objects Special Interest Group (FO SIG), led by Goldman Sachs and ISDA, actively discusses collaboration on data modeling for varying business uses, for example carbon credits for energy projects and data lineage of digital assets are amongst recent topics the FO SIG has discussed. “We have a successful track record of model development using Legend at FINOS and we are fully committed to establishing an operating model that incorporates both Legend and Rosetta in the CDM modeling process.” Said Ian Sloyan, ISDA’s Senior Advisor, Data and Digital Solutions and a Co-Lead of the FO SIG.
At the recent Open Source in Finance Forum in New York, the trade associations came together to discuss their vision for the future of the CDM and it also marked a major achievement, as ISDA’s Digital Regulatory Reporting (DRR) project went live in production with a member using the code developed using the CDM to comply with regulatory reporting requirements under the US Commodity Futures Trading Commission’s revised swap data reporting rules.
“Seeing a highly competitive industry like financial services coming together to embrace the open source development model for something as transformational as the CDM is a pivotal moment for our Community,” said Gabriele Columbro, Executive Director at FINOS and General Manager of Linux Foundation Europe. “Open source collaboration goes way beyond code and the contribution of the CDM is a testament to the relentless work of our contributors that paved the way for the creation of a truly open data ecosystem for this industry.”
Join the FINOS community and be a part of this exciting journey towards a standard for financial instruments and their lifecycle events. With the working groups now available within the FINOS community calendar, it is open for those interested in contributing. On 14 March 2023, the FINOS CDM Contribution Review Working Group will officially commence.
Visit the FINOS Common Domain Model landing page here.
The International Securities Lending Association (ISLA) is a leading non-profit industry association, representing the common interests of securities lending and financing market participants across Europe, Middle East and Africa. Its geographically diverse membership of over 190 firms includes institutional investors, asset managers, custodial banks, prime brokers and service providers.
Working closely with the industry, as well as national, regional, and global regulators and policy makers, ISLA advocates for, amongst other things, the importance of securities lending to the broader financial services industry. It supports both the Global Master Securities Lending Agreement (GMSLA) legal framework, including the Title Transfer and Securities Interest over Collateral variants, as well as the periodical enforceability and security enforcement across global jurisdictions.
Through member working groups, industry guidance, consultations and first-class events, ISLA plays a pivotal role in the creation and promotion of market best practices and processes, thought leadership, standards for legal frameworks, and securities lending guides and related documents.
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FINOS (The Fintech Open Source Foundation) is a nonprofit whose mission is to foster adoption of open source, open standards and collaborative software development practices in financial services. It is the center for open source developers and the financial services industry to build new technology projects that have a lasting impact on business operations. As a regulatory compliant platform, the foundation enables developers from these competing organizations to collaborate on projects with a strong propensity for mutualization. It has enabled codebase contributions from both the buy- and sell-side firms and counts over 50 major financial institutions, fintechs, and technology consultancies as part of its membership. FINOS is also part of the Linux Foundation, the largest shared technology organization in the world. Get involved and join FINOS as a Member.
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Since 1985, ISDA has worked to make the global derivatives markets safer and more efficient. Today, ISDA has over 1,000 member institutions from 79 countries. These members comprise a broad range of derivatives market participants, including corporations, investment managers, government and supranational entities, insurance companies, energy and commodities firms, and international and regional banks. In addition to market participants, members also include key components of the derivatives market infrastructure, such as exchanges, intermediaries, clearing houses and repositories, as well as law firms, accounting firms and other service providers. Information about ISDA and its activities is available on the
ICMA promotes well-functioning cross-border capital markets, which are essential to fund sustainable economic growth. It is a not-for-profit membership association with offices in Zurich, London, Paris, Brussels and Hong Kong, serving over 600 member firms in 65 jurisdictions. Among its members are private and official sector issuers, banks, broker-dealers, asset managers, pension funds, insurance companies, market infrastructure providers, central banks and law firms. It provides industry-driven standards and recommendations, prioritising three core fixed income market areas: primary, secondary, repo and collateral, with cross-cutting themes of sustainable finance and fintech. ICMA works with regulatory and governmental authorities, helping to ensure that financial regulation supports stable and efficient capital markets.