CIA (e)Bulletin/(e)Bulletin de l'ICA
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March 2017
 
 

Enterprise Risk Management Practice Committee

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By Danielle Harrison, FCIA

Do you work in risk management? Are you interested in developing standards for enterprise risk management (ERM) guidance materials? The new Enterprise Risk Management Practice Committee (ERMPC) may be the place for you to make a difference.

The ERMPC officially kicked off in January 2017. Its mandate is "to be the primary source of risk management guidance for the actuarial profession". To accomplish this goal, the committee will review, create, and promote resources that can benefit Canadian risk practitioners, and promote actuaries as risk management professionals within and outside of the profession.

The idea for the ERMPC originated from the Enterprise Risk Management Applications Committee (ERMAC); for several years there had been discussions regarding the need for an ERM practice committee. Many ERM practitioners, myself included, are looking for an authoritative source of guidance on ERM practice. We regularly receive questions from board members, direct reports, and others who want to become better educated about ERM, but there is no single authoritative source to send people to.

It makes sense that practising actuaries affiliated with ERM look to their professional body as a source of guidance, in this case through a Canadian lens. That’s where the ERMPC comes in.

ERMPC Priorities

The committee, currently made up of three of the original working group members, is refining its mandate to be reviewed and approved by the Practice Council, and defining its top priorities.

One of these priorities will be reviewing and evaluating publications related to risk management. Where it makes sense, we will review publications from other organizations, for example, the International Actuarial Association (IAA), to determine if those materials are relevant for Canadian practice and either endorse the publication, publish caveats, or identify areas of research and topics where the development of educational notes and/or standards of practice would be beneficial to Canadian risk practitioners.

Volunteers Needed

One of the committee’s other priorities is to recruit between five and seven new members. We are currently creating a skills matrix, similar to what is developed for boards of directors, and we will recruit volunteers with that matrix in mind. In general, we will be looking for a combination of technical expertise and senior management experience. We don’t want to be so removed from ERM implementation challenges that we create guidance material that is not practical.

While the majority of risk management specialists are in insurance or the financial sector, we want, where possible, to broaden our reach into non-traditional areas. We will also be looking for members who work with different types of employers beyond ERM in insurance. A number of industries are looking to risk management capacity; even those who work in traditional roles may have risk management responsibilities. A diverse committee will help us to set priorities that will be effective and beneficial to the broad spectrum of risk management practitioners.

Challenges

Simply creating the committee was a challenge, as it has been quite some time since the CIA established a new practice committee. Determining the people we needed to talk to and the process to create one took a great deal of time and effort. Carving out our mandate has also been a challenge: we want to be the primary source of risk management guidance for the actuarial profession, but at the same time we are not looking to replace existing materials, but rather to filter and aggregate them, and fill the gaps as needed. Other committees touch upon risk-related topics, but as a whole, the Institute is not necessarily consolidating that information in a consistent way. The ERMPC wants to ensure we are providing consistent guidance to our membership, not replacing the risk-related work that other CIA committees may be performing.

Part of providing consistent and comprehensive guidance will be membership feedback, which I welcome. There is a broad audience and a lot of different perspectives. We hope it will be a diverse committee, but we won’t be able to cover everything. I expect a lot of comments from our membership and great feedback to help improve any documents we may produce so that they resonate with all of our actuarial risk practitioners.

Benefits

The ERMPC provides an opportunity to have an established venue/committee where we can talk about and debate these risk management practice issues and concerns. We will be providing guidance and education for the next generation of risk management professionals. That will be extremely satisfying.

If you are interested in volunteering, contact me at danielle_harrison@cooperators.ca.

Danielle Harrison, FCIA, is Chair of the Enterprise Risk Management Practice Committee.

 

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