In April 2018, the US Securities and Exchange Commission (SEC) announced that The Dun & Bradstreet Corporation “agreed to pay $9 million to resolve Foreign Corrupt Practices Act charges arising from improper payments made by two Chinese subsidiaries”.
According to the SEC’s order: “One subsidiary, part of a joint venture with a Chinese company, acquired non-public financial statement information on Chinese entities, in violation of Chinese law, by making unlawful payments to Chinese government officials”.
This represented a low point for the (already opaque) Black Box company data market. So do you really know where the company data you use comes from?
In this post we’ll explore key questions you should be asking of your data providers, and how the White Box data revolution is bringing about disruptive change – so everybody benefits.
Questions you should ask
As this case makes clear, any organisation that uses, or needs to use, company data at scale should ask two questions before acquiring such data.
1) Where does the data come from & how was it collected?
You should always be confident about where the data your external vendors provide you with comes from, and when and how it was collected.
One should always ask about the origin of data and its manner of collection, but if the answer you hear is a variation of “it’s complicated” or “it’s a trade secret”, then it’s not good enough.
Being wilfully blind to the source of your data, and how it was collected, is no longer acceptable. You simply cannot be confident in using your data without having a transparent line of sight into its origins.
2) Is the data fit for purpose?
There are numerous reasons why Black Box data is no longer fit for purpose. Our white paper, which was based on interviews with numerous technology and data experts, identifies a long list of drawbacks, including:
- Lack of provenance
This is problematic because many users of data, particularly those in risk and compliance oriented roles, need to be confident in its use when making risk-based decisions. After all, it’s not defensible to justify risk-related decisions to a stakeholder or regulator if you’re in the dark about where data comes from and when it was collected.
- Poorly defined models
Black Box data providers use different proxies for a company – it might be a vague notion of a ‘business’ or a corporate address. You need transparency about exactly what a record means, and this should correspond to a legal entity.
- Poor data quality feedback loops
When company data is openly accessible by millions of users, this creates a positive feedback loop in which the many eyes on the data help to improve its quality – both in the original official source and in open databases like OpenCorporates’. Black Box providers only allow paying customers to access their data at scale, or only a small slice of it, which leads to a poor data quality feedback loop.
- Vendor lock-in
Proprietary identifiers, such as the DUNS number, make it very difficult for users to integrate systems or combine datasets if you don’t already have a Black Box data provider’s proprietary identifier for each record. This can lead to vendor lock-in.
The White Box Data Revolution
For these reasons and more, OpenCorporates is leading a White Box revolution in how company data is provided at scale. This means that data is clearly-defined and that company data contains provenance – indicating the ‘where?’ and ‘when?’.
The revolution is gaining momentum, as after two decades of using the DUNS number, the US General Services Administration has decided that by April 2022 they will move away to a new, open identifier when validating third parties.
Over 400 organisations already rely on our White Box data at scale via our API or Bulk Data to create a trusted business environment and solve a range of critical challenges.
Black Box data will soon be a thing of the past, as the White Box model becomes foundational to the work of organisations around the world.
What are you waiting for? Join the White Box revolution in company data.
- White paper
Our White Paper, The White Box Data Revolution, dives further into the drawbacks of Black Box data and the move towards White Box data.
- Access our data at scale
Find out more about our API & Bulk Data.
blog.opencorporates.com 