LEI (Legal Entity Identifier): Creation, Usage & Benefits

Learn how User Migration with Okta reduced unexpected password resets and reduces helpdesk calls and support issues.

Similar to a bar code, the legal entity identifier (LEI) is a reference code that identifies a legal entity that is participating in a financial transaction. 

The LEI is based on the International Organization for Standardization, ISO 17442, and is an alpha-numeric string that is uniquely generated for each legal entity. This is important as the LEI can be used to precisely identify a legal entity during a financial transaction to allow regulators and risk managers to identify the entities involved.

The LEI is a global identifier, and each LEI contains pertinent information about the structure of the entity’s ownership by connecting to necessary reference information. The LEI is unique to each legal entity and housed in a public data pool. 

The LEI provides transparency in the global marketplace, as entities are able to see exactly who is involved in each financial transaction. 

What is LEI?

The LEI, legal entity identifier, is a unique alpha-numeric string that operates as a reference code for legal entities involved in a financial transaction. This operates as a method of providing a global identifier for each particular legal entity to ensure transparency during financial transactions. 

A global LEI system was called for and driven by the Group of 20 (G20) and the Financial Stability Board (FSB) after the stock market crash in 2008. There are currently over 2 million active LEIs across the globe.

The LEI is the first unique global legal entity identifier. It allows financial companies, regulators, and risk managers to immediately see exactly who is on the other side of a financial transaction. 

The LEI is an alpha-numeric code of 20 characters, based on the ISO 17442 standard. It is an identification number that provides key information about who owns whom and who is who in a financial transaction.

Why is LEI used?

The financial crisis of 2008 really drove home the need for a global system to help with identifying and linking financial data to specific legal entities. Without this ability, it is difficult for financial firms to determine the extent of their exposure during a failure.

Financial institutions, along with their regulators and policymakers, are better able to track connections across the financial system and therefore identify potential exposures using the LEI. It works to precisely and quickly identify all parties on the other side of a financial transaction.

Legal entities that use an LEI can include the following:

  • Banks
  • Investment companies
  • Lenders
  • Financial intermediaries
  • Entities listed on a stock exchange
  • Commodities traders
  • Insurance companies
  • Brokerages
  • Credit unions

Individuals cannot be issued an LEI number.

How does LEI work?

An LEI is a 20-digit alpha-numeric reference code meeting the 2020 ISO specifications outlined in the ISO 17442-1:2020. The LEI is assigned to each specific legal entity by a local operating unit (LOU) after the entity pays an initial registration fee and continues to pay an annual maintenance fee. Part of these fees goes to the central operating unit — the Global Legal Entity Identifier Foundation (GLEIF). 

An LEI contains several different parts. The first four digits of the LEI identify the issuer, or the LOU. Digits five and six of the LEI always have a value of 0 while characters 7 through 18 are unique to the entity. The last two digits of an LEI are used for verification purposes and are check digits described in the ISO 17442 standards.

The LEI provides reference information on the legal entity it represents in two tiered levels. Level 1 information contains the “who is who” data, such as this:

  • Legal name of the entity
  • Legal jurisdiction of the entity
  • Status of the entity
  • Registration authority
  • LEI registration date

Level 2 information contains the “who owns whom” data, which includes the following:

  • Parental relationships in corporate structures
  • Outline of parent companies and subsidiaries

LEIs are renewed annually, and this involves again validating the data of the entity to ensure it remains up to date. 

What is the future of LEI in the global marketplace?

Currently, LEIs are mandatory in the United States (US), European Union (EU), United Kingdom (UK), Canada, Australia, and several other countries. Many other markets and financial institutions around the world adopt and voluntarily use LEIs as well. 

Financial institutions often operate internationally, and many times legal entities are required to have an LEI, or they are prevented from trading. LEI is a global identifier, and its reach is expanding. As of August 2021, LEIs had been issued to entities in more than 225 countries and territories.

The goal of the Office of Financial Research (OFR) is to continue to expand the use of LEIs to promote a truly unified and global system. This increases financial transparency and allows for more oversight and easier reporting procedures. 

The global LEI governing structure and worldwide framework, the GLEIS (Global LEI System), is made up of the ROC (Regulatory Oversight Committee), the GLEIF, and LEI issuers — the LOUs.

What are the benefits of adopting the LEI?

Large international banks can often have more than one legal entity that performs financial transactions, and each of these entities will have an LEI. By adopting the LEI, the structure and connections of legal entities engaging in financial transactions are more transparent. This enhances risk management for entities and offers better insight into the global marketplace. 

Adopting the LEI can also be more cost-effective for entities by lowering data reconciliation and transaction failures and reducing regulatory reporting costs. The LEI can simplify and streamline operations by helping financial companies be more efficient at the following:

  • Data collection
  • Internal reporting
  • Risk management
  • Data maintenance

The LEI also reduces overlap and duplication that occur with multiple identifiers. Therefore, it can also simplify regulatory reporting and bring more efficiency to reporting entities. The financial sector could potentially stand to save between $300 million and $10 billion, as estimated by industry standards, with the universal adoption of the global LEI system.

Additional resources

In a partnership between private and public institutions, the legal entity identifier system is always expanding in hopes of complete and universal adoption. Some LEI resources include the following:

Okta works within the financial services industry to provide identity and access management solutions while supporting the adoption of LEIs by legal entities. It can also help to secure APIs, such as the GLIEF API, to do a more thorough search for LEIs to delve deeper into corporate structures.


ISO 17442-1:2020. (August 2020). ISO.

FSB Financial Stability Board. (2022). FSB.

LEI Statistics. (2022). Global Legal Entity Identifier Foundation (GLEIF).

LEI. (2022). Global Legal Entity Identifier Foundation (GLEIF).

Legal Entity Identifier. Office of Financial Research (OFR).

Global LEI System. ROC.

Legal Entity Identifier – Frequently Asked Questions. Office of Financial Research (OFR).

Get an LEI: Find LEI Issuing Organizations. (2022). Global Legal Entity Identifier Foundation (GLEIF).

LEI Search 2.0. (2022). Global Legal Entity Identifier Foundation (GLEIF).

Global LEI Index. (2022). Global Legal Entity Identifier Foundation (GLEIF).

Find a Legal Entity Identifier. Office of Financial Research (OFR).

Identity and Access Management for Financial Services. (2022). Okta.

GLEIF API. (2022). Global Legal Entity Identifier Foundation (GLEIF).