Keeping actuarial practice ahead in a changing world

In the sixth of our series on the work of the IFoA’s Practice Area Boards, outgoing Chair, Louise Pryor, details how the Resource and Environment Board is working to help members account for environmental risks in their work. 

Other blogs in this series:

• Better serving members in finance and investment (seventh)
• The growing profile of health and care (eighth)
• View all blogs in this series

In 2018-2019 the Resource and Environment (R&E) Practice Area Board has continued to focus on supporting all actuaries, whatever field they work in, on climate change and other environmental issues.

Get involved with the R&E Board

Working with others

We have worked with other IFoA practice area boards and their working parties, and have established a joint working party with IEMA (a professional body for those working in environment and sustainability) to develop a users’ guide to climate-related financial disclosures, following on from a very successful joint webinar with them.

We continue to support JFAR – the Joint Forum on Actuarial Regulation – in developing content about climate risk for its annual risk perspective document.

We also have regular liaison calls with a group of international actuarial bodies to share items of interest. We are exploring ways of working more closely with other bodies, as there are several groups with similar aims.

The Board’s input is increasingly sought after by a range of stakeholders.

The Department of Work and Pensions invited a member of the R&E Board to participate in roundtable discussions to help inform amendments to investment regulations.

Similarly, the Prudential Regulation Authority met with Board members to discuss the draft supervisory statement on climate change.

In total, five relevant consultations were identified and responded to throughout the session.

Other notable invitations included ICAEW’s TCFD workshops and the Green Skills Roundtable jointly hosted by BEIS, HM Treasury and the Green Finance Initiative.

The wider world

There was R&E involvement in events hosted in the UK, Singapore, South Africa, India and Canada. These include events organised by the R&E Board and committees, other parts of the IFoA, and by SIAS, NoCA (the Network of Consulting Actuaries), the Canadian Institute of Actuaries, and the Institute of Actuaries of India.

October’s webinar on the UN’s Sustainable Development Goals was viewed in at least 14 countries.

We have also piloted new types of events, such as the IFoA’s first twitter chat in March.

We are working hard to introduce new ways of interacting with members, especially those based outside the UK. We have recently established a new subcommittee to look at how we can use digital communications, including social media, more productively.

For IFoA members

We have launched a working party on the role of energy in the economy, as part of our efforts to develop a deeper understanding of how sustainability issues impact actuarial work.

We have an active Member Interest Group which runs a study group for members to learn about climate change, and we are just about to launch one on the Sustainable Development Goals.

We have continued to issue practical guides for actuaries, adding three to the list this year: an introduction to climate change; allowing for climate change when setting financial assumptions for defined benefit pension schemes; and a practical guide to climate change for general insurance actuaries.

There are now six altogether, with a further three in preparation. We hope to complete the set within the next few months.

We are also raising our members’ awareness of broader sustainability topics through a series of articles on the IFoA website.

Overall, we are making good progress on our objective of supporting our members on climate-related issues, in that there is increasing awareness that climate change is a significant source of long-term financial risk that is relevant to much actuarial work.

There is much to be done in the area of developing and disseminating tools and techniques to address the problem, and this will undoubtedly be a major focus of our work over the next few years.

We will continue to explore potential opportunities for actuaries to apply their skills and expertise in new areas, such as climate-related financial disclosures.

We are looking at the IFoA’s educational syllabus and lifelong learning offerings in the light of the Green Finance Education Charter, launched by the government to help build green financing skills across banking, financial and professional services.

Understanding complex and distant risks is a core area for actuaries, so we consider that the IFoA and its members should be among the leaders in this field.

The world is changing rapidly, and actuaries need to change with it.

Get involved with the R&E Board

If you would like to get involved with the R&E Board, visit the IFoA’s volunteer vacancies webpage to see current opportunities or express your interest.

Other blogs in this series

• Practice Area Boards: driving IFoA outputs (first)
• Global focus for GI actuarial practice (second)
• Connecting colleagues in risk management (third)
• Life Practice Board: In the twilight zone of Brexit (fourth)
• Pensions Practice Board: protecting the actuary’s role (fifth)
• Keeping actuarial practice ahead in a changing world (sixth)
• Better serving members in finance and investment (seventh)
• The growing profile of health and care (eighth)