Canadian
Institute
of
Actuaries
L’Institut
canadien
des
actuaires
2009 Annual Meeting ● Assemblée annuelle 2009
Halifax, Nova Scotia ● Halifax (Nouvelle-Écosse)
2009 Annual Meeting
Assemblée annuelle 2009
PD-18 ERM Going Global
Stephen P. D’Arcy
Professor Emeritus of Finance,
University of Illinois
Member of the Global ERM
Designation Treaty Task Force
Global Enterprise Risk Management
Designation Recognition Treaty
Overview
2009 Annual Meeting
Assemblée annuelle 2009
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Purpose of Treaty
Background
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Key Elements of Treaty
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ERM
Specialists Moving into ERM
Actuarial Global Designation
Global Enterprise Risk Management
Designation Recognition Treaty - version
6.2 (June 2009)
Next Steps
Purpose of Treaty
2009 Annual Meeting
Assemblée annuelle 2009
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Develop an agreement among
actuarial organizations on a single,
globally recognized ERM designation
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Enhance the role of actuaries in ERM
Facilitate international ERM applications
Develop a consistent standard for the
ERM designation
Allow members of multiple organizations
to gain this recognition by qualifying with
one organization
Background of ERM
2009 Annual Meeting
Assemblée annuelle 2009
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ERM developed in the 1990s as a
response to financial risk management
failures
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Chief Risk Officers
Regulation
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Basel
Sarbanes-Oxley
Role of risk management expanded to all
risks
Specialists Moving Into ERM
2009 Annual Meeting
Assemblée annuelle 2009
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PRMIA – Professional Risk Manager’s
International Association
GARP – Global Association for Risk
Professionals
Accountants
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COSO - Committee of Sponsoring
Organizations of the Treadway Commission
Financial Engineers
Actuaries
Actuarial Global Designation
2009 Annual Meeting
Assemblée annuelle 2009
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Statement of Intent
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Dublin IAA meeting – October 2007
15 Actuarial Organizations Heavily
Involved, including CIA
Treaty Task Force, chaired by Fred
Rowley (Australia)
Syllabus Task Force, chaired by Harry
Panjer
Approximately a dozen organizations
are now prepared to sign this treaty
Key Elements of Treaty - 1
2009 Annual Meeting
Assemblée annuelle 2009
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Terms
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Founding Party – initial signatory
Acceding Party – subsequent signatory
Award Signatory – awards designation
Board
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First 3 years - representatives of all founding
and acceding parties
After 3 years – representatives of award
signatories
Review Panel – evaluates designation
process of potential award signatories
Key Elements of Treaty - 2
2009 Annual Meeting
Assemblée annuelle 2009
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Each signatory agrees to meet
educational standards for awarding
designation to its members
If a member has earned this
designation from another signatory,
that will be accepted by other
signatories
Designation will be termed CERA
Key Elements of Treaty - 3
2009 Annual Meeting
Assemblée annuelle 2009
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Awarding designation
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Must be to IAA Fully Qualified Actuary
Subject to code of ethics or professional
conduct
Meets educational standards of approved
syllabus
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Examined by actuarial organization
Qualified by an accredited education provider
Key Elements of Treaty - 4
2009 Annual Meeting
Assemblée annuelle 2009
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Weighted Voting
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If not on the Board, 1 vote
If on the Board (once board exceeds 8)
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2 votes plus
1 vote for 200-599 Fully Qualified Actuaries
1 vote for each 400 FQA over 200 up to 9000
1 vote for each 800 FQA over 9000
Weight limited to 12.5% of total votes
Once 10 or more award signatories each
have awarded 50 or more designations,
policy will be reviewed to shift toward
designees instead of FQA
Next Steps
2009 Annual Meeting
Assemblée annuelle 2009
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Signing of treaty by founding parties
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Form Implementation Steering Group
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Expected to be by 30 June 2009
Fred Rowley will chair
CIA, CAS, SOA + 10 other organizations
Form Review Panel
For individual organizations
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Determine how to award this designation
Apply for award designation status
Begin to award designation