Ronald Poon-Affat meets Jon Gordon to discuss his book, and his reasons for wishing to writing it
What is the book about?
The book is a bit like the actuarial equivalent of Life, the Universe and Everything. Its central premise is that the world is entering a period of unprecedented change in recent history, and that old paradigms can no longer be relied upon. It examines the recent financial crisis in this context, and explores those aspects of the human condition that I believe have thus far contrived to prevent policymakers - not to say our own profession - from learning the wider lessons recent experience has afforded us.
I don't count myself among the small number of people who foresaw the financial crisis that began in 2007 - for those interested in the genuine article I cannot recommend Ann Pettifor's 2006 book The Coming First World Debt Crisis highly enough. But it was evident to me that much of the supposed boom we'd witnessed in the years leading up to it was being fuelled by little more than debt and optimism, and it was also apparent to me that the activities of some sectors of the financial services industry were contributing significantly to the problem.
Although the book is aimed at members of the actuarial profession I think the issues it raises should be of interest to all. Indeed I would put it even more strongly: I'd say a failure to act on them has implications for us all. Talk of risk management may be all the rage these days, but a review of recent history shows that the big risks are often missed. Why is this? And what needs to change to stop history repeating itself? These are the questions my book seeks to answer.
Where is it set?
The challenges the book explores are global in nature, and those global challenges are going to require global solutions. Although the book draws heavily on US and UK experience, it should be of interest to actuaries everywhere. I've now presented on the book's subject matter to actuaries on three continents, and I've been heartened by the reception it's received.
Tell us about yourself
I am a UK-based actuary with some twenty five years' experience of working in the finance sector, mainly in the life and health industries. That experience splits broadly into three segments. I began my career with one of the leading consultancies before moving into industry, and I have been self-employed since returning from a (rather late!) gap year in 2005. The self-employed lifestyle is one that suits me well, in that it has freed me to express my own views without having to consider what my employer might think of them.
Why did you write this book?
The other advantage of being self-employed is that it offers one the chance to pursue the kind of interests that can find themselves neglected over long years on the company payroll. I've always had a passion for writing, but only in the last few years have I really had an opportunity to indulge it.
In a way I think the long wait must have paid dividends, for the words came easily. In a particularly productive eighteen month window I wrote this book and two others, the first an irreverent take on the state of my nation and the second a fond memoir of a happy childhood - a book whose first printed copy I placed in my father's hands on the occasion of his last birthday, just ten days before he passed away.
The main reason I wrote the actuarial book is that I do not believe in recent years my profession has served the public interest as effectively as the public had reason to expect it to. "Every man is a debtor to his profession", I was told when I enrolled. Quite so, but every profession is also a debtor to society, and I became sufficiently concerned about my own profession's indebtedness that I wanted to try and do something about it. Writing a book to help promote a debate of the issues seemed the best option.
Not all risks can be foreseen of course, but the financial crisis was not (to borrow Nassim Nicholas Taleb's potent metaphor) a black swan event. To me it is simply part of a bigger story, one that is in urgent need of a better narrative to have a positive outcome. This book is a small contribution to that end, written in the hope that it may yet prove to be a catalyst for the profession to make a rather bigger one. History could yet thank us for it.
John Gordon BSc FIA is a U.K. based independent actuary and consultant. He is contactable at [email protected]
On the Role of the Actuary in a Changing World is available on