1. PROFESSIONALISM: OVERVIEW, TOPICS, DISCUSSION
CAA ANNUAL WORKSHOP MARCH 20, SESSION B5
PROFESSIONALISM: OVERVIEW, TOPICS, DISCUSSION
Welcome.
Good morning.
Please take a seat at one of the tables with a Table #.
The next two slides are housekeeping --- don’t bother to take notes!
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2. DISCUSSION LEADERS Jay M. Jaffe, FSA, MAAA Elliot Chanen
President, Actuarial Enterprises, Ltd.
Elliot Chanen
Consultant, The Terry Group
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3. SOCIETY OF ACTUARIES Antitrust Compliance Guidelines
Active participation in the Society of Actuaries is an important aspect of membership. While the positive contributions of professional societies and associations are well-recognized and encouraged, association activities are vulnerable to close antitrust scrutiny. By their very nature, associations bring together industry competitors and other market participants.
The United States antitrust laws aim to protect consumers by preserving the free economy and prohibiting anti-competitive business practices; they promote competition. There are both state and federal antitrust laws, although state antitrust laws closely follow federal law. The Sherman Act, is the primary U.S. antitrust law pertaining to association activities. The Sherman Act prohibits every contract, combination or conspiracy that places an unreasonable restraint on trade. There are, however, some activities that are illegal under all circumstances, such as price fixing, market allocation and collusive bidding.
There is no safe harbor under the antitrust law for professional association activities. Therefore, association meeting participants should refrain from discussing any activity that could potentially be construed as having an anti-competitive effect. Discussions relating to product or service pricing, market allocations, membership restrictions, product standardization or other conditions on trade could arguably be perceived as a restraint on trade and may expose the SOA and its members to antitrust enforcement procedures.
While participating in all SOA in person meetings, webinars, teleconferences or side discussions, you should avoid discussing competitively sensitive information with competitors and follow these guidelines:
Do not discuss prices for services or products or anything else that might affect prices
Do not discuss what you or other entities plan to do in a particular geographic or product markets or with particular customers.
Do not speak on behalf of the SOA or any of its committees unless specifically authorized to do so.
Do leave a meeting where any anticompetitive pricing or market allocation discussion occurs.
Do alert SOA staff and/or legal counsel to any concerning discussions
Do consult with legal counsel before raising any matter or making a statement that may involve competitively sensitive information.
Adherence to these guidelines involves not only avoidance of antitrust violations, but avoidance of behavior which might be so construed. These guidelines only provide an overview of prohibited activities. SOA legal counsel reviews meeting agenda and materials as deemed appropriate and any discussion that departs from the formal agenda should be scrutinized carefully. Antitrust compliance is everyone’s responsibility; however, please seek legal counsel if you have any questions or concerns.
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4. Presentation Disclaimer
Presentations are intended for educational purposes only and do not replace independent professional judgment.  Statements of fact and opinions expressed are those of the participants individually and, unless expressly stated to the contrary, are not the opinion or position of the Society of Actuaries, its cosponsors or its committees.  The Society of Actuaries does not endorse or approve, and assumes no responsibility for, the content, accuracy or completeness of the information presented.  Attendees should note that the sessions are audio-recorded and may be published in various media, including print, audio and video formats without further notice.
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6. SESSION GENERAL GOALS / AGENDA
Overview:
The concept of professionalism CE
Topics:
professionalism
COI’s (conflicts of interest NOT cost of insurance)
“Straws”
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7. WRAP UP DISCUSSION Potential feedback to SOA about CE
Meeting professionalism CE requirement:
What areas of professionalism should be emphasized?
How best to discuss and/or teach professionalism?
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8. THE PLAN FOR EACH TOPIC Introduction (Jay) Reaction/comment (Elliot)
Discussion (the audience)
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9. 2 RECORDERS NEEDED #1 #2 #3
The recorder will take notes of the table discussion.
The recorder or someone else will present the table’s thoughts to the entire group. Because of the size of the audience, we’ll only hear from 2 groups per topic unless a group has a major comment to make about the topic.
The recorder should also remind the group that the program has been modeled on the concept of a “speed dating” event and we want to move quickly to get through the entire agenda.
When the recorder returns to his or her office, I’d appreciate receiving a summary of your table’s discussion so that I can summarize the comments and convey them to the appropriate person at the SOA as input from members about professionalism.
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10. THE MEANING OF PROFESSIONAL AND PROFESSIONALISM
Chris Daykin
“Professionalism and Trust”
Chris was the UK government actuary for nearly 20 years.
Widely respected.
He has been a deep thinker about actuarial practice topics.
I’d describe Chris as a “good guy” and definitely someone with whom you’d enjoy having drinks and dinner.
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11. WHY START WITH THIS SESSION WITH A DISCUSSION OF PROFESSIONAL AND PROFESSIONALISM? Answer: to establish a common knowledge base
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12. ELEMENTS OF A PROFESSION
A skilled intellectual technique
A voluntary association bound by a code of conduct
A formalized mode of enforcing the code of conduct upon the membership
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13. 10 DISTINGUISHING FEATURES OF A PROFESSION
Advanced educational requirements
Accreditation of the educational standard by a professional body
Requiring work experience in a professional context
Professional code of conduct
Written standards of practice
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14. 10 DISTINGUISHING FEATURES OF A PROFESSION
6. Collective responsibility for maintenance of competence and standards 7. Requirement to remain a member in good standing 8. Continuing professional development requirements 9. A comprehensive discipline process 10. The possibility of a common voice to participate in public debate
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15. THE BENEFITS TO THE PUBLIC OF PROFESSIONS
Quality assurance:
Education
CE and professional development
Professional norms and standards of practice
Degree of consistency in professional advice
Availability of the professional service
Fiduciary responsibility between professionals and their clients
3rd parties being able to lay a complaint and seek redress
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16. A PROFESSIONAL’S FIDUCIARY RELATIONSHIP
Mutual trust between a client and professional
No material info withheld by client
Client trust in a professional because of education and membership in a professional body
Tailoring advice to a client’s needs and in accordance with professional standards
Remuneration is fee based and all other relevant interests are disclosed
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17. Someone who follows the principles of his or her profession
PROFESSIONAL
Someone who follows the principles of
his or her profession
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18. ARE SOA, CAS, CCA, ASPA AND MAAA MEMBERS PROFESSIONALS?
YES
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19. ELLIOT’S REACTION/COMMENTS
Need to understand both professional and employer discipline options
What are actuaries’ fiduciary responsibilities?
A SOA member’s responsibility for CE should be communicated earlier rather than later in the accreditation process
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20. DISCUSSION TOPIC #1: CE Should the actuarial profession require CE?
Should professionalism CE be required?
If CE were NO longer required, how would you maintain your actuarial and professionalism skills?
If CE continues to be required, what improvements to the present SOA system would you recommend?
It may turn out that you get more from this session during the table discussions than from my remarks. If so, my feelings won’t be hurt. In fact, as noted earlier, this is the goal of the session.
You won’t have time for all of the discussion topics. I’ve usually highlighted one of the topics but if your table would prefer to concentrate on any of the non-highlighted topics, definitely do so.
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21. JAY’S PERSONAL THOUGHTS
CE is necessary regardless of any requirements
Professionals need to be prepared for change and innovation --- staying current is a must: hence, CE
Reviewing CE related materials may look different now as compared to the last time you read the document
Change and innovation stimulation is often found in non-actuarial meetings and publications --- consider a broader definition of CE
Engage with actuaries outside of your environment (international, other specialists, volunteer, etc.) --- not only to establish personal contacts but for cross-fertilization of professionalism
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23. A BRIEF HISTORY OF PROFESSIONAL COMMUNICATIONS
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24. EMAIL PROFESSIONALISM: 16 REMINDERS*
Use a clear, direct subject line
Use a professional address
Think twice before hitting “reply all”
Include a signature block
Use professional salutations
Use exclamation points sparingly
Be cautious with humor
*Inc.com, 2/2/16
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25. EMAIL PROFESSIONALISM: 16 REMINDERS
8. Know that people from different cultures speak and write differently 9. Reply on a timely basis to all s 10. Proofread/spellcheck every message 11. Add the recipient(s) address last 12. Double-check the recipients 13. Use classic fonts 14. Monitor your language
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26. EMAIL PROFESSIONALISM: 16 REMINDERS
15. NO S, TWEETS, OR OTHER ELECTRONIC COMMUNICATIONS ARE CONFIDENTIAL!
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27. EMAIL PROFESSIONALSIM: 16 REMINDERS
16. S ARE PERMANENT!
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28. OTHER WARNINGS
Become familiar with and follow your employer’s protocols
Keep your private communications on non-business devices
If you mess up, immediately notify unintended recipients
Review ASOP #41 (Communications) which covers all communications such as s but also verbal interchanges
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29. MORE ABOUT S
s are probably always discoverable communications.
If an is to be confidential, see your lawyer before sending.
Carefully use “bcc” and “reply to all.”
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30. and your s!
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31. WHAT’S DISCOVERABLE?
The short answer is everything --- even phone messages!
Time may dampen memories but NOT obscure electronic communications
Electronic communications provide an accurate picture of “what you were thinking”
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32. BIG BROTHER AND YOUR OPPONENT’S ATTORNEY ARE WATCHING YOUR EMAILS
Assume all are discoverable
Be careful what you put in an ; the things that you think are funny today may not seem funny to a jury five years from now.
If you would be embarrassed to see your published in the New York Times, don’t press “send.”
Employees have no privacy rights in s sent on corporate computers.
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33. SOCIAL MEDIA
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34. ELLIOT’S REACTION/COMMENTS
TEXTING IS NOT PROFESSIONAL!
What is a timely basis for a response?
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35. DISCUSSION TOPIC #2: EMAIL
preservation/discovery?
Any electronic or clear professional communication tips to pass along to the group?
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36. ACTUARIES’ EMAIL THOUGHTS*
Provide context and caveats even when they are not required. For example: “This is an of my full opinion. Please contact me for more information.”
Consider the appropriate level of formality or informality that is appropriate for a particular .
Don’t become someone who opens SPAM!
Avoid multiple topics in a single and chains.
Color coding (such as yellow for a question) may help to increase readability and clarity of an .
Use personal conversations, phone calls, etc. for sensitive matters r/t .
Avoid negativity in s.
*Discussion at SOA 2017 Annual Meeting
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37. CONFLICTS OF INTEREST
In a second you’ll see the connection between this slide and conflicts of interest.
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38. CONFLICT OF INTEREST
A situation in which a person or organization is involved in multiple interests, financial or otherwise, one of which could possibly corrupt the motivation or decision-making of that individual or organization (Wikipedia)
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39. HARVARD MEDICAL SCHOOL (HMS)
HMS is about a mile and a half from the Hynes Convention Center.
It has recently wrestled with conflicts of interest and offers an example of how another body and professional group has addressed conflicts of interest.
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40. HMS CONFLICT OF INTEREST (COI*) POLICY INTENTS
Reduce research risks
Maintain public trust
Identify conflicts
Manage conflicts
*COI is not Cost of Insurance!
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41. HMS PRESUMPTIVELY PROHIBITED ACTIVITIES*
Faculty may not have financial interest exceeding de minimis thresholds
De minimis income defined as <$25,000 from research activity
Faculty who serve in a fiduciary role to a for-profit business may not receive sponsored research support from the business
Faculty are prohibited from soliciting or accepting any industry sponsored gifts, meals or travel
*Harvard University Faculty of Medicine Policy on Conflicts of Interest and Commitment, updated 5/16
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42. JOURNAL OF THE AMERICAN MEDICAL ASSOCATION (JAMA)
May 2, 2017 Issue (v. 317, #17) devoted to Conflicts of Interest
About 30 articles!
Wide range of COI topics (> the obvious COI issues)
Recognition of a major area of concern for professionals
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43. SOA VOLUNTEER COI DISCLOSURE
I affirm that the following are all my (including anyone with whom I directly share income) material business, financial and organizational interests and affiliations which are or could be construed to be reasonably related to the interests, activities and programs of the Society of Actuaries.*
* Also refer to Explanation of COI Policy
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44. DEALING WITH CONFLICTS OF INTEREST
Disclosure is a must
Do it upfront
Put it in writing
Recusal is an option
After-the-fact realization is too late --- avoid the problem in the first place!
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45. ELLIOT’S REACTION/COMMENTS
Who can help me if I’m not sure if I have a conflict of interest?
Provide me any actuarial professional guidelines for COI’s at the start of my career!
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46. DISCUSSION TOPIC #3: CONFLICTS OF INTEREST
Do you see any COI’s (or potential COI’s) in your work?
For example, as the Valuation Actuary for an insurance company, do or could you have a conflict of interest such as:
A financial interest in the insurer;
A bonus dependent on earnings
How to avoid or handle COI’s?
Would it be helpful for the actuarial profession to have more definitive and broader COI guidelines?
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47. THE STRAW THAT BREAKS THE CAMEL’S BACK
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48. THINGS THAT CAN GET YOU IN TROUBLE
The usual ones: lying, stealing, cheating, moral turpitude*, etc.
Doing stupid things
Inaction once something happens
Inadequate documentation
Poor communications
Missing deadlines
Gross errors
Failing to report misconduct by another actuary
*Legal Definition of moral turpitude: (a) an act or behavior that gravely violates the sentiment or accepted standard of the community and/or (b) a quality of dishonesty or other immorality that is determined by a court to be present in the commission of a criminal offense.
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49. STRAW EXAMPLE: EVALUATING MODEL RESULTS
The end result is what is usually looked at by “management”
Assuming the actuarial model is reasonable, it is the model assumptions that determine the end result --- but does each assumption have to be exact?
Models can be deterministic or stochastic:
Is there a % variation from the most likely result that is acceptable if deterministic?
What is an acceptable range within which the result must fall if stochastic?
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50. PREVENTION TOOLS Give yourself time to let your work percolate
Answer the following: is my result reasonable?
Peer review
Peer counsel (including ABCD)
Legal counsel
Don’t let something fester
Explain your professional standards to your boss and that “you can loose your license”
Use multiple approaches to test results
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51. EXCUSES THAT WON’T WORK (PARTICULARLY IN COURT)
I’m young and naïve
I’m old and tired
I did my best
It is only a small lie or mistake
I don’t recall
The other person is more guilty than I am
“No harm, no foul”
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52. THE BIGGEST PROBLEM: WHEN TO WALK AWAY
Always be prepared to walk away
Discuss your predicament with you family --- they will usually steer you in the right direction
Maintain your ethics and standards --- if you don’t, the next time it is easier to justify make a bad decision --- doubling down is NOT an option
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53. DON’T EVEN COME CLOSE TO A STRAW THAT MIGHT BREAK A CAMEL’S BACK
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54. PROFESSIONAL INFLECTION POINTS
Decisive moments that mark the start of significant change. The term comes from math, where it describes the point at which a convex (upward) curve turns concave (downward) or vice versa.
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55. ELLIOT’S REACTION/COMMENTS
Excuses are never the answer
Find and use actuarial and/or professional mentors
ADHERE TO YOUR MORAL COMPASS!
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56. DISCUSSION TOPIC #4: PROFESSIONAL INFLECTION POINTS
Ideas for checking your work for flaws
Who do you turn to when you have a critical professional question?
How to recognize you are at a professional inflection point?
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58. AND / OR
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59. 1. Please summarize your notes 2. Email your notes to jay@actentltd
1. Please summarize your notes 2. your notes to
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