By Sheetal Kaura and Chaundra Mcgill
The number of recipients who have received the CERA credential has grown significantly. And now, thanks to a worldwide marketing campaign aimed at employers, the credential's reputation for excellence is growing as well.
Not since the year 1949 has the Society of Actuaries embarked on an educational initiative as pivotal as the launch of the Chartered Enterprise Risk Analyst (CERA) credential. The CERA credential is not only an opportunity for actuaries to apply their knowledge in the field of enterprise Risk Management (ERM), but to broaden the reach of the actuarial profession across many industries in the global marketplace. The current economic climate only confirms that there is no better time for such an initiative.
Government bailouts, bank and brokerage house failures, along with historic stock market plunges, have sounded an alarm that the Risk Management approach used by big business must change. Ask a different person and you will receive a different answer as to who is at fault for the financial crisis. Some blame mortgage brokers and overextended homeowners, others fault Wall Street CEOs and corporate greed. But one fact that is largely undisputed is that if proper ERM measures were in place, the current economic situation may not look as bleak, or if nothing else, there could have been ample forewarning of the downturn.
Company executives now have very vivid case studies of how not taking a candid and comprehensive look at their company's risk profile can have devastating and far–reaching effects.
"ERM has grown substantially in the past few years and I think it is going to continue to grow in importance," said Frank Sabatini, FSA, CERA, MAAA, Independent Advisory Services. "I think ERM will become even more important as other risk events occur that have an impact on organizations and ultimately consumers, like the recent happenings in the credit markets and the subprime mortgage industries. Companies are going to come to realize that having disciplined ERM is going to help sustain the long–term value of the organization."
The guiding principles of ERM—a qualified leader, clear communication, a combination of qualitative and quantitative information, a broader focus, an attitude adjustment—help companies do just this. The concept of ERM is not new to many large corporations. Many industry conferences targeting the corporate leaders and Risk Management executives highlight or feature the benefits of ERM. The promise of greater transparency, regulatory compliance, business continuity and disaster preparedness is not lost to the executive audience.
But the key to the effective implementation of an ERM program starts with a qualified leader, and no risk professional is more qualified to lead a company's ERM program than a CERA. In order to inform employers about the capabilities of CERAs, the SOA launched an extensive marketing and advertising campaign to raise awareness about the importance of ERM and the credential.
In April 2008, the SOA launched monthly full–page, four–color advertisements in Best's Review and Risk Management magazines. Each advertisement featured a different CERA and their brief commentary on the importance of ERM or the significance of the CERA credential. The advertising campaign was very successful in 2008, and we have expanded the reach of our ad campaign in 2009. In addition to continuing advertisements in Best's Review and Risk Management magazines, we are also placing advertising in several 2009 issues of CFO and Harvard Business Review magazines.
Our ad campaign has not been restricted to print publications; we have online ads on the Best's Review and Risk Management magazines' Web sites and will continue to do so throughout 2009. We have also placed advertisements on the Risk & Insurance magazine Web site, as well as sponsoring their ERM In–Depth series. In addition to these online advertisements, we have been actively engaged in a campaign to make the placement of the CERA Web site more prominent on Web search engines.
CERAnalyst.org received a facelift in 2008, creating a comprehensive resource about the credential itself and the ERM field. Based on the feedback of our members, we reorganized the Web site to increase navigability and make information more accessible. CERAnalyst.org features an ERM resource section that includes background information of the emerging field, research projects, essays and case studies. We also included an announcement section and events section to keep visitors abreast of new developments and industry conferences.
Conference attendance and sponsorship has been an effective means for the SOA to raise awareness among and actively engage employers about the credential. In 2008, we exhibited at the American Bankers Association Annual Convention, attended by CEOs, presidents and other senior executives from financial services firms across the nation. We also exhibited at the American Banker Insurance Association Annual Conference, which hosted 600 senior bank–insurance executives, CEOs, senior community bank executives, compliance officers and actuaries. We were also a sponsor at The Conference's Board's Enterprise Risk Management Conference, in which 200 CROs, senior ERM executives and finance executives convene to discuss the latest developments in the field of ERM. Conference attendees at these events expressed great interest and recognized the need for the skills set and capabilities of CERAs. In 2009, we will return to these events as well as attend the Bank Insurance & Securities Association Annual Convention, The Financial Management Association Finance Leaders' Conference, the CFO Rising 16th Annual Conference/Expo, the Independent Community Bankers of America National Convention, and the Risk and Insurance Management Society's Annual Conference and Exhibition.
These very marketing endeavors contributed to the branding of CERAs as the ERM experts and increased awareness of the credential among employers, but 2008 was also a year to raise awareness among colleagues and prospective members of the actuarial profession. We ran four–color, two–page ads in The Actuary as well as call–out boxes and advertisements in the SOA's Section newsletters. We also engaged Canadian actuaries by placing half–page ads in the Canadian Institute of Actuaries' publication Beyond Risk, which has continued into 2009. CERAs have also been at the forefront of raising the profile of the credential by giving presentations to their coworkers and actuarial club members around the world.
"Members of the SOA, and actuaries around the world, have embraced the concept of the CERA enthusiastically," said S. Michael McLaughlin, FSA, CERA, FIA, MAAA, president–elect of the Society of Actuaries and global leader, A&IS, for Deloitte Consulting LLP. "A number of organizations in other countries are working with the SOA to offer the CERA in their country."
There is no better example of the geographic reach of the credential than through the applicant pool of the Experienced Practitioner's Pathway. Originally scheduled to expire on July 1, 2008, the SOA extended the deadline to Dec. 31, 2008 to offer more actuaries the opportunity to earn the CERA credential based on their professional ERM experience. The Experienced Practitioner's Pathway seminars are not only a way for accepted applicants to ratify their CERA status, but a great networking opportunity with other ERM practitioners. Actuaries from Bermuda, Canada, China, Cyprus, Hong Kong, Japan, Malaysia, the Netherlands, Singapore, Taiwan, United Kingdom and the United States obtained the CERA credential through the Experienced Practitioner's Pathway. In 2008 alone, the Experienced Practitioner's Pathway seminars yielded 120 new CERAs, contributing to the 2008 year–end total of 299 CERAs.
"The growth to approximately 300 CERAs by the end of calendar 2008 is right in line with our expectations," said McLaughlin. "We knew it would take 12 to 18 months after the launch of the credential to reach this membership level. We expect to have 600 CERAs by year–end 2009 with increasing numbers thereafter."
The Experienced Practitioner's Pathway, however, was not the SOA's primary method of obtaining new CERAs. Due to increased demand, the SOA offered the Advanced Finance/Enterprise Risk Management exam in the fall of 2008 in addition to the regular exam offering in the spring. To date, the majority of CERAs received the credential through the exam process.
Sheetal Kaura, ASA, CERA, MAAA, obtained the CERA credential through the exam process. And just as the credential has flourished, so has Kaura's career. When interviewed in March 2008, the then associate director was very hopeful about the outlook of the credential and her own professional growth.
"I think the CERA credential is going to open the door to a lot more opportunities for me," said Kaura. "For instance, with the role I have with Fitch Ratings, it's a very unique, non–traditional role. The credential has given me the knowledge and training needed to be considered as an authority on risk."
In the time since her March 2008 interview, Kaura has been promoted to her current position of director of Insurance at Fitch Ratings.
"I not only have earned a promotion for my commitment to education and earning the CERA credential, but I have also earned the respect of my colleagues and other actuaries," Kaura said. "The CERA credential is going to allow other actuaries and candidates to obtain a foothold in other industries such as banking, ratings agencies and outside of the traditional insurance company or consulting roles."
Sheetal Kaura, ASA, CERA, MAAA, is director of Insurance at Fitch Ratings. She can be contacted at firstname.lastname@example.org.
Chaundra McGill is a marketing and communications project specialist—CERA at the Society of Actuaries. She can be contacted at email@example.com.