Scepticism and responsibility
I recently attended the excellent Risk and Investment Conference. Set in the conference’s theme of communication were a good range of quantitative and qualitative talks. The thought-provoking keynote speech on applying anthropological techniques to studies of the markets was particularly mind-opening. In hindsight this seems elegantly obvious. After all, markets are just collections of people, not physical processes purely definable with equations. However, for me the stand-out message from the conference came unexpectedly at 22.00, after the gala dinner.
I doubt many people were expecting Johnny Ball – a former television presenter specialising in science – to be quite so striking a speaker. The topics of climate change and morality in investing were always going to polarise the audience. However, I believe that his key messages were far wider reaching, and were positive opportunities. Here is my take on his speech.
Challenge rhetoric with fact. Scepticism is healthy; it needs to be fact-based, though. (Ball highlighted many holes in the carbon dioxide-causes-climate-change argument. His main point however, was the ease with which ‘everyone’ has accepted these apparently flawed arguments). Perhaps a more topical example for us may be the blind acceptance of rating and copulas in collateralised debt obligations pricing. There are lessons to be learnt, certainly.
The opportunity of influence. I overheard a fellow delegate describe another part of the speech as “a rant about asset allocation”. My take on it was that Ball was paraphrasing Spiderman’s uncle: “with great power comes great responsibility”. We all have influence – some more than others. Some of us influence the flows of other people’s money. We need to consider our actions, their morality and their implications, beyond our own bottom line. He was challenging us to use our influence to make positive changes. It’s too easy to say “it’s not my problem”, or “if I don’t do this, someone else will”.
I think Ball’s message was a simple and important one, worth transmitting beyond the conference. Overall, I believe this speech was about decisions and opportunity. We should make decisions based on core values, facts – and healthy challenging of those facts – and an attempt to make the world a better place. It may be a hard thing to try to do in the real world with many conflicting agendas. But I hope this sort of message has a future in our industry.
Russell Bowdrey, 25 July
High barrier for entry to Australia
Recent Australian immigration changes are quite beneficial for people associated with the actuarial profession in many ways, but the only concern I have is the occupation ceiling, which is 420 places for actuaries.
I assume these would be taken up very quickly, and subsequently the points required to get an invitation to apply through SkillSelect can be as high as 75 – because only the top ones would get into the 420 places available. I hope I am wrong, though.
Irfan Chaudry, 19 July
Definition of an actuary: ‘a professional manager of the financial implications of uncertainty’.
Iain Walker, 3 August
From actors to owls
I was glad to hear that others also struggle to explain the role of an actuary (‘Opinion’, August issue). For me, responses range from the standard “You’re an actor?” through to “Is that like investment banking?”
My favourite, however, was from a friend who said “That sounds like it has something to do with owls.” He was much gratified to see that the Institute and Faculty’s crest confirmed his suspicions – although I’d suggest that the word ‘ratio’ in the motto is far more indicative.
Jessica Elkin, 9 August