Legal and compliance tactics for improving alternative data quality

Brittany Thomas, Senior Regulatory Analyst (New York)

Neudata Sentry
Post feature

Quality needs to be defined by the buyer if it is not defined by the seller.

Data quality is poorly understood, in large part due to the difficulty of adopting and documenting consistent metrics across unrelated datasets. While many of the problems inherent in assessing quality are well-known, a buyer’s legal and compliance team can assist with imposing certain controls at the diligence and contract stages of the onboarding process designed to improve quality in many instances.


Buyers and sellers are more focused on commercial aspects of data deals.

Buyers regularly ask us about data quality (e.g. duplication of postings in job posting data, etc.) as an initial screen before starting the formal diligence process. Quality control, at each step of the onboarding process, from initial discussions through contracting and subsequent performance assessments, is part of a best-practices approach. As larger corporates join the provider (and buyer) universe, standards may shift in favor of more developed commercial contracting approaches, driven by the leverage of the particular buyer and seller involved. We see persistent interest in the adoption of quality standards from the buyside, which has until recently been primarily focused on regulatory compliance rather than quality as a legal matter.

It is also worth pointing out that quality metrics are often covered in a data provider’s marketing material and pitches, which may be incorporated expressly into a deal.