From the President: International Issues by Steven G. Lehmann

Recently the CAS Board approved for submission to the Fellows for a vote an Executive Council proposal to revise the constitution so that the CAS Board of Directors will be authorized to set the duties and number of vice presidents. The immediate purpose of this change is to add a new vice president to coordinate CAS international activities. I strongly endorse this change in our organization structure and the creation of a new Vice President-International. I believe that this change will allow the CAS to better serve its members in other countries and raise the visibility of the CAS in international actuarial circles.

You may be wondering if this emphasis on international is really necessary. When I took office as president-elect eighteen months ago, I had never been to another country outside the U.S. and Canada. My attitude toward international activities may have been like a lot of yours: I was somewhat skeptical of the need for spending a lot of time and energy on the international area. Since taking office, I have become convinced that it is vital to our long-term success that we take a more international view. Consider the following:

1. In the last 18 months, there has been significant activity involving U.S. and Canadian companies merging with, acquiring, or being acquired by a foreign company.
2. We now have three Regional Affiliates outside the U.S. and Canada. The Taiwan Exam Center for the Society of Actuaries is now their largest exam center.
3. The globe is shrinking. More and more companies are expanding to other countries or looking to expand to other countries.
4. The actuarial profession is becoming global. Actuaries are moving to other countries to practice. Many countries are looking to develop their own general insurance actuaries.

These developments suggest the need for the CAS to take a proactive role in providing service to our members in other countries and to build respect for the CAS internationally.

We in the CAS have a level of expertise and training in property/casualty risks not found in most actuarial organizations outside the U.S. and Canada. We have a unique opportunity to expand our influence internationally and become a principal source for property/casualty research, education and expertise worldwide. A new vice president overseeing an expanded committee structure will provide a more effective way to coordinate these efforts. Although the committee structure is not set yet, we envision at least three committees:

1. A committee to coordinate our activities in the International Actuarial Association.
2. A committee to respond to requests for advice and assistance from countries wishing to establish a general insurance actuarial program.
3. A committee of senior actuaries to represent the CAS at international actuarial meetings.

Another idea worth considering is to establish "ambassadors" in other countries to serve as the chief CAS contact in those countries.

We are also considering more effective ways to disseminate CAS research to the international actuarial community.

Mutual Recognition

In her "From the President" column last November, Mavis Walters discussed the issue of mutual recognition. Mutual recognition would involve giving FCAS status to Fellows of other exam-giving bodies whose exams we have determined to be equivalent to ours and who meet certain additional requirements (for example, 12 months residence in the U.S., taking the professionalism course, and possibly a country-specific practice course). The quid pro quo would be fellowship in the other country's actuarial society for CAS members who establish practice in that foreign country. This proposal is being evaluated by the CAS Task Force on Mutual Recognition chaired by Mary Frances Miller.

There are difficult issues that need to be addressed by the task force in connection with mutual recognition. Are the examinations of the bodies comparable in difficulty? How do we deal with the fact that no other organization has the depth and breadth of education in property/casualty issues? And, most importantly, how do we assure ourselves that members of other actuarial organizations who establish residence in the United States are familiar enough with the legal, regulatory and accounting systems to be competent to practice?

On the other hand, mutual recognition offers a way for organizations with a rigorous education and exam process to recognize each other's members. We have much in common with actuaries from other countries around the world. If we decide against mutual recognition, how will the CAS be viewed in five years? Will we wish we had opened our doors to the global profession and likewise opened doors to our actuaries moving out into global practice? Would denial of mutual recognition be consistent with a goal of a broader, more expansive CAS? Would it be a move towards "protectionism" and away from free and open competition?

Please let Mary Frances Miller or me have the benefit of your thoughts on this important subject.

Editor's note: If you have comments about this column, please send them to Steve Lehmann c/o the CAS office or send an E-mail directly to Steve (SteveL@MRHT.COM). Alternatively, if you want your view published article, please send it to The Actuarial Review.