Rise of the CDO

In retrospect, there is a lot of truth in this thesis. The CDO is represented in many committees of the traditional bank, its sphere of influence theoretically covers all relevant areas of the bank and yet the effective scope of influence is limited, the impact of the function limited.

Market dynamics, technological quantum leaps and unprecedented pressure from international supervisory authorities are forcing a central function that centralises the data agenda of banks, controls it stringently and opens new doors. The CDO steps out of the shadows and offers a solution to address these challenges:

• More complex world: new and complex data requirements, for example from ESG, Bird and IReF require an efficient scope with data and no longer allow banks to think and work in silos. Data must be networked and managed according to harmonised standards. Increasing data requirements necessitate data transparency.
• Technological acceleration: The world is talking about GenAI. Where technological quantum leaps have been made, their effective utilisation has not got off the starting block. The reason for this is a lack of data transparency and deficiencies in data quality and data provision. Only the CDO with its set of standards for harmonised data management creates the conditions for the use of technological innovations. At the same time, (Gen)AI applications offer opportunities to support and scale data management, e.g. for data cleansing and the detection of data quality deficiencies.
• Regulatory pressure: International regulators are tightening the thumbscrews on banks. The ECB in particular is using its range of sanction instruments to force banks to implement impact-orientated data management. The supervisors are demanding clear responsibilities, a deliberately set strategic central data agenda, clear Board of Directors comittment and harmonised, effective data management standards. Ultimately, many of the supervisory authority's key points of criticism boil down to one question: who in the bank is centrally responsible for data?

Just setting standards is a thing of the past - the modern CDO is becoming an enabler and controller in the banking ecosystem! To effectively tackle the complex challenges associated with data, the CDO role needs to be made effective. To do this, the role must be reinterpreted and modernised. Today, the CDO defines himself as a service provider for finance, risk controlling and operations, over and above establishing regulatory compliance and setting standards. This makes the CDO a controller, coordinator and enabler on the path to becoming a data-driven bank: