Statement on Equity Market Data Governance Reforms
May 6, 2020
Thank you, Mr. Chairman, and thank you to Michael Coe for working so hard with my office on this order. The Commission today is considering an order that, if approved, will require participants of the Market Data Plans to submit a new consolidated data plan that would streamline the current consolidated market data plans into a single plan and incorporate a more transparent and more appropriate governance structure for the plan. This order reflects a long-ongoing conversation among a wide variety of market participants regarding the distribution of market data, the continued relevance of consolidated data feeds to the needs of those seeking to trade in our public markets, and the conflicts that may arise from the availability of faster, more comprehensive proprietary data feeds.
As I expected, commenters had strongly-held and widely divergent views about whether to proceed with these reforms and, if so, how. In light of these comments and after further consideration of the challenges users face with respect to the consolidated data feed, I have concluded that reforms to the consolidated market plan are appropriate. Given the contentious nature of the issues, it is also appropriate for the order to establish parameters that should guide the plan participants in developing a new consolidated equity market data plan. In particular, requiring that participants consolidate the three data plans into a single new plan should make distributing market data more efficient, eliminate duplicative costs, and streamline compliance and oversight. Moreover, adding new voices to the operating committee should help increase transparency and accountability to the market as a whole. Together with the conflicts and confidentiality amendments that the Commission approved earlier today, this order represents a significant, if incremental, step in improving our system for distributing market data.
I want to echo the Chairman’s appreciation to all those in the Division of Trading and Markets and throughout the Commission who worked so hard to prepare this final order for our consideration. I know that Director Redfearn, his deputies, Lizzie Baird and Christian Sabella, and the rest of the Division staff have been busy overseeing developments in the markets, engaging regularly with market participants, and determining where relief or guidance may be appropriate. Much of this work has been done during late evenings and long weekends, and I have heard from market participants that they appreciate your efforts to ensure that our rules do not produce unintended harmful effects in a period of high volumes and volatility. That you are also, in the midst of this situation, continuing the day-to-day policymaking work of the Commission is a testimony to your dedication to serving the American investor. I only wish that you had more time during this Public Service Recognition Week to savor the joy of a job well done, but I suspect that current conditions will afford you no rest.
Finally, it is fitting for me to conclude my remarks on governance with an expression of gratitude for our chairman. How something—whether a consolidated data plan or the SEC—is governed, matters. I would like to express my appreciation to Chairman Clayton for his leadership of the Commission, particularly in the recent months. No chairman likes to see a crisis on his watch. The current crisis, which feeds on the uncertainty surrounding so many aspects of our lives, presents the Commission and market participants with unique challenges. Chairman Clayton has demonstrated exemplary leadership to the benefit of this agency, the markets, and our nation.
I have no questions and am happy to support the staff’s recommendation.