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Benchmark Independence

April 10, 2014

Benchmarks are at the heart of the financial system. They play a critical role for participants globally, from determining bank borrowing costs to providing fund managers with ways to gauge portfolio performance. Recently, however, market participants have rightly become concerned about the transparency and independence of some benchmarks, specifically in the fixed income, currency and commodity markets. Banks have traditionally been responsible for calculating and governing these indexes, but the LIBOR scandal and other questionable activity has caused investors and regulators to seek independent partners to assume responsibility for indexes.

Bloomberg was founded on the principle that markets need transparency that can best be provided by neutral parties to enable fair and equal access to all participants. That notion remains core to our business today, and it’s why we see both an opportunity and responsibility to assume a greater role in providing independent indexes.

Earlier this month, we announced that Bloomberg Indexes had acquired UBS’s Australian bond indexes to promote transparency in the Australian marketplace. Today, we’re building on that effort by announcing that we will oversee, govern and manage UBS’s family of global commodity indexes, which serves as a bellweather of the commodities markets for approximately $80 billion in investor funds.

There is a clear and necessary global shift toward independent indexing and greater transparency for financial benchmarks, especially in the underserved fixed income, currency and commodity markets. We expect the need for independent global indexes will only increase, and we’re committed to continue supporting this vital function.

-Dan Doctoroff, CEO and President of Bloomberg LP