The Legal Entity Identifier (LEI) initiative is designed to create a global reference data system that uniquely identifies every legal entity or structure, in any jurisdiction, that is party to a financial transaction.

Endorsed by the G20, the establishment of a Global LEI System (GLEIS) is critical to improving measurement and monitoring of systemic risk. Global, standardised LEIs will enable regulators and organisations to more effectively measure and manage counterparty exposure while also resolving long standing issues on entity identification across the globe. To aid global allocation of LEIs, Local Operating Units (LOUs) have been formed and must be sponsored by local regulators to assign and maintain LEIs to firms on a cost recovery basis.

The use of the LEI has been mandated by the European Securities and Markets Authority (ESMA) for the reporting of derivative transactions to Trade Repositories under European Market Infrastructure Regulation (EMIR).