Actuaries institute calls for global risk framework in financial sector
The Institute of Actuaries of Australia has called for the implementation of a global risk management framework to improve financial governance and help prevent future financial crises.
The proposed framework is contained in a new report by its parent body, International Actuarial Association, entitled "Dealing with Predictable Irrationality - Actuarial Ideas to Strengthen Global Financial Risk Management".
Institute of Actuaries of Australia president Trevor Thompson said the report had "wide-reaching implications for regulators globally as they consider measures to strengthen the financial system".
"While Australia's banking system has proven its robustness, we are clearly not insulated from global events," he said.
Leading Australian actuary and chair of the International Actuarial Association's Enterprise and Financial Risk Committee Tony Coleman said there were many lessons to be learned from the current crisis.
"Failures in the banking system highlight the need for stronger systemic risk management at a micro level for individual entities, and at a macro level for the system as a whole," he said.
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