www.the-actuary.org.uk
about half of whom are actuaries, I believe
actuaries are well-placed to work in risk
management roles as a result of their technical
skills. They should aspire to be leaders in the
field. Their core training and way of thinking
of the world is highly suited to working in
ERM. Their ability to create quantitative
models and manipulate figures is valuable in
risk management, and their structured way of
thinking can also be beneficial.
Important skills
`Softer' skills, such as communication,
are also highly important in the field.
The key skills that I look for when I am
recruiting are solid technical skills and an
ability to communicate well -- not just to
other actuaries but to colleagues in other
departments and at different levels. Risk
managers don't work in a vacuum, but as
part of a wider company or organisation.
The value of these skills is increasingly
being recognised and actuarial students are
required to pass a communication skills
module as part of their education to qualify
for the Profession. The organisers of this
year's Momentum Conference for newly
or soon-to-be qualified fellows have also
acknowledged the importance of non-
technical skills by including sessions for a
range of `soft' skills in the programme.
Actuaries who are interested in working
in ERM should attend networking events to
build their communication skills and gain
a better understanding of the area. It can
be exciting because there are no textbooks,
t-shirts or films with a unified theory on
risk management. People who become
involved are coming in at an early stage in
the evolution of risk management and can
embrace the creation of new structures and
processes. It is a broad sector that can have a
significant impact on a company.
The problem-laden opening of Terminal 5
at Heathrow was an example of where a more
embedded culture of risk management could
have helped to prevent problems. There would
have been various clues telling the managers
of the project that the terminal wasn't ready,
although hindsight makes that a lot easier to
see. Perhaps if there had been an ingrained
risk culture where staff in different areas could
flag their concerns, scenario-planning had
been carried out and the appropriate processes
put in place, that would have helped. With
the appropriate risk processes one would have
hoped that it would have opened successfully,
or a decision might have been made to
postpone the opening until the problems were
ironed out.
Increased demand
Increased regulation involved with the
introduction of Solvency II and Basel II,
as well as companies' bad experiences is
likely to increase demand in enterprise risk
management. The implementation of the
new forms of regulation will mean that
companies will have to prove their risk
management credentials, leading to the
creation of further risk management roles.
Actuaries are very well placed to undertake
these roles. They have a strong role to
play in creating quantitative models and
potentially leading risk management teams.
They will be invaluable to companies, and
I am confident that they will prove their
worth in the risk space.
For the latest career opportunities, turn to the
Appointments section on page 47, or visit www.jobs.
the-actuary.org.uk
Opening new doors
Roger Dix examines the opportunities available to actuaries within
enterprise risk management in light of the changing economic climate
Roger Dix is head
of group insurance
and investment risk
at HBOS
ERM Careers
October 2008 37
O
pportunities for actuaries to work
in enterprise risk management
(ERM) are set to increase as
companies learn the lessons
from the credit crunch and Solvency II
and Basel II are implemented. The new
focus on risk management has made it
more important than ever for actuaries to
develop their `softer' skills to complement
their traditional technical acumen.
Companies are increasingly recognising
the need for effective ERM strategies. Recent
issues, such as the credit crunch and the
troubled opening of Terminal 5 highlighted
the need for a better approach.
It often takes a disaster for companies
to realise they have to do something, even
though the time to consider risk is when
things are benign. After all, the best time to
mend the roof is when the sun is shining,
not when a monsoon is occurring. Better
risk management processes might not have
prevented the credit crunch from happening
but it would have meant that managers
were better prepared for the possibility, and
mitigating actions could have been taken.
An integral part of business
Companies needed to consider ERM as a more
integral part of their business if they wanted
to operate effectively and be prepared for
the future. It should be a foundation upon
which you build your company. It is not only
relevant to insurers and financial managers
but in all walks of life. Quite simply, it is about
assessing your risks, the return obtained from
accepting them and the capital required to
cover future risks.
As the head of a team of risk managers,

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