13 Sep 2019 Independent Actuarial Thought Leadership

These are tumultuous times for the global actuarial profession. A handful of major trends, each of which started to emerge decades ago, are having an increasing impact on the present and likely future of actuarial work. These trends look likely to have a defining impact on the actuarial profession, the scope of its role and the nature of its work over the coming years. They include:

• The unprecedented low / negative interest rate environment that has emerged, seemingly in slow motion, as a result of 40 years of falling long-term interest rates. Today, yield curves have reached levels thought literally impossible only a few years ago. The implications for the economics of long-term saving are profound and pervasive.
• The rapid developments in digital technology. Most notably, the increase in computer processing power; the reduction in data storage costs; the emergence of networked, quantified and near-continuous measurement of almost anything; and the development of computer-based algorithmic predictive methods that attempt to make use of it all.
• The broad societal desire to remove professional judgement and resolve professional skill into a transparent set of objective and well-defined tasks. An unfounded faith in the universal applicability of a form of positivist scientific method underlies this increasingly strong preference for technique over judgement wherever possible.

This short list is not exhaustive. But it is sufficient to suggest genuinely exciting opportunities lie ahead for actuarial thought-leadership that embraces these challenges and seeks to find constructive solutions.

After 20 years in consulting, software and asset management firms of various shapes and sizes, I have decided to play my part in fully embracing these challenges by setting out as an independent consulting actuary and scholar. I will accelerate my independent thought-leadership activities in research and writing with a particular focus on how actuarial methodology must adapt and evolve to succeed in this new world. I look forward to working with actuaries and others – from data scientists to central bankers – to play as active and constructive a role as I can in helping to forge an actuarial future that makes the best use of the profession’s unique set of skills, experience and heritage.