course on professionalism code of professional conduct and code of professional ethics for...

Course on Professionalis

mCode of Professional

Conduct and

Code of Professional Ethics for Candidates

2

Code of Professional Conduct

Effective: May 9, 1993, Amended November 12, 2000

Similar to that used by all other professional actuarial organizations - it provides a universal definition of acceptable behavior

Alleged violations are investigated by the Canadian Institute of Actuaries for actuarial practice in Canada or the ABCD, elsewhere.

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Code of Professional Conduct

Categorized into 11 Divisions with 14 “Precepts” and 23 “Annotations”:

“The Precepts identify the professional and ethical standards with which an actuary must comply…”

“The Annotations provide explanatory, educational and advisory material…on how the precepts are to be interpreted and applied”

“An Actuary must be familiar with, and keep current with, revisions to the code of professional conduct, its precepts and annotations”

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Key Definitions within Code

Actuary A member of an organization that has

adopted the Code (e.g. CAS) Principal

Client or employer of Actuary Actuarial Services

Provided to Principal by individual acting in the capacity of an actuary

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Actuarial Communication Written, oral, or electronic issued by

Actuary with respect to Actuarial Services

Confidential Information Information not in public domain

obtained as a result of providing Actuarial Services to a Principal

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Law Statutes, regulations, judicial decisions,

and other statements having legally binding authority

Recognized Actuarial Organization An organization that has been accepted

for full membership in the International Actuarial Association or a standards setting, counseling, or discipline body to which authority has been delegated by such an organization

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Professional Integrity

PRECEPT 1:An Actuary shall act honestly, with integrity and competence, and in a manner to fulfill the profession's responsibility to the public and to uphold the reputation of the actuarial profession

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Qualification Standards

PRECEPT 2:An Actuary shall perform Actuarial Services only when the Actuary is qualified to do so on the basis of basic and continuing education and experience and only when the Actuary satisfies applicable qualification standards

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ANNOTATION 2-1:It is the professional responsibility of an Actuary to observe applicable qualification standards that have been promulgated by a Recognized Actuarial Organization for the jurisdictions in which the Actuary renders Actuarial Services and to keep current regarding changes in these standards.

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Standards of Practice

PRECEPT 3:An Actuary shall ensure that Actuarial Services performed by or under the direction of the Actuary satisfy applicable standards of practice

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Standards of Practice

ANNOTATION 3-1:It is the professional responsibility of an Actuary to observe applicable standards of practice that have been promulgated by a Recognized Actuarial Organization for the jurisdictions in which the Actuary renders Actuarial Services and to keep current regarding changes in these standards.

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Communications and Disclosure

PRECEPT 4:An Actuary who issues an Actuarial Communication shall take appropriate steps to ensure that the Actuarial Communication is clear and appropriate to the circumstances and its intended audience and satisfies applicable standards of practice

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ANNOTATION 4-1:An Actuary who issues an Actuarial Communication shall ensure that the Actuarial Communication clearly identifies the Actuary as being responsible for it.

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PRECEPT 5:An Actuary who issues an Actuarial Communication shall, as appropriate, identify the Principal(s) for whom the Actuarial Communication is issued and describe the capacity in which the Actuary serves

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PRECEPT 6:An Actuary shall make appropriate and timely disclosure to a present or prospective Principal of the sources of all direct and indirect material compensation that the Actuary or the Actuary's firm has received, or may receive, from another party in relation to an assignment for which the Actuary has provided, or will provide, Actuarial Services for that Principal. The disclosure of sources of material compensation that the Actuary's firm has received, or may receive, is limited to those sources known to, or reasonably ascertainable by, the Actuary

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Conflict of Interest

PRECEPT 7:An Actuary shall not knowingly perform Actuarial Services involving an actual or potential conflict of interest unless: the Actuary’s ability to act fairly is

unimpaired; there has been disclosure of the conflict to all

present and known prospective Principals whose interests would be affected by the conflict; and

all such Principals have expressly agreed to the performance of the Actuarial Services by the Actuary

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Control of Work Product

PRECEPT 8:

An Actuary who performs Actuarial Services shall take reasonable steps to ensure that such services are not used to mislead other parties

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Confidentiality

PRECEPT 9:

An Actuary shall not disclose to another party any Confidential Information unless authorized to do so by the Principal or required to do so by Law

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Courtesy and Cooperation

PRECEPT 10:

An Actuary shall perform Actuarial Services with courtesy and professional respect and shall cooperate with others in the Principal's interest

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Advertising

PRECEPT 11:

An Actuary shall not engage in any advertising or business solicitation activities with respect to Actuarial Services that the Actuary knows or should know are false or misleading

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Titles and Designations

PRECEPT 12An Actuary shall make use of membership titles and designations of a Recognized Actuarial Organization only in a manner that conforms to the practices authorized by that organization

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Violations of the Code of Professional

Conduct PRECEPT 13:

An Actuary with knowledge of an apparent, unresolved, material violation of the Code by another Actuary should consider discussing the situation with the other Actuary and attempt to resolve the apparent violation. If such discussion is not attempted or is not successful, the Actuary shall disclose such violation to the appropriate counseling and discipline body of the profession, except where the disclosure would be contrary to law or would divulge Confidential Information

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Violations of the Code of Professional

Conduct PRECEPT 14:

An Actuary shall respond promptly, truthfully, and fully to any request for information by, and cooperate fully with, an appropriate counseling and disciplinary body of the profession in connection with any disciplinary, counseling or other proceeding of such body relating to the Code. The Actuary's responsibility to respond shall be subject to applicable restrictions on Confidential Information and those imposed by Law

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Canadian Rules of Professional Conduct

The Rules of Professional Conduct in Canada require that certain procedures must be followed when a member is aware of a violation of the Rules Affirmative

responsibility to act to correct violation

No confidentiality agreement or employment protections exist

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Code of Professional Conduct in Asia

Singapore The Singapore Actuarial Society (SAS) requires all

members to adhere to its Code of Professional Conduct

There are 23 statements grouped into 6 categories: General, Actuarial Advice, Independence, Communication of Actuarial Advice, Publicity, Discipline

These statements are very similar to those found in the CAS’s Code of Professional Conduct

Malaysia The Actuarial Society of Malaysia (ASM) has a

Professional Code of Conduct The code is made up of 12 precepts that are very

similar to those found in the CAS’s Code of Professional Conduct

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Mainland China The Chinese Association of Actuaries (CAA) is under

the regulation of the Chinese Insurance Regulatory Commission (CIRC). This is very different from the US where only the “business of insurance” is regulated by the insurance authority. In China, the “entity” of insurance is regulated by the insurance authority. This includes the conduct of an actuary.

There is no official “code of conduct” but the rules of an actuary’s conduct are embedded in insurance regulations. Hence, violation of these rules will incur more serious consequences compared to violation of an actuarial society’s code of conduct

Therefore it is important for an actuary practicing in mainland China to check the latest regulations regarding actuarial work

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Hong Kong The Actuarial Society of Hong Kong has a

Professional Conduct Code (PCC) There are 19 statements grouped into 5 categories:

General, Independence, Formulation of Advice, Appointment of New Adviser, Relations with Other Actuaries and Publicity

These statements are very similar to those found in the CAS’s Code of Professional Conduct

Taiwan The Actuarial Institute of Chinese Taipei has a Code

of Conduct Its precepts and annotations are very similar to those

found in the CAS’s Code of Professional Conduct

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Thailand The Society of Actuaries of Thailand (SOAT) has a

Code of Professional Conduct that is identical to the CAS’s Code

India The Actuarial Society of India has a set of

Professional Conduct Standards (PCS) that is substantially similar to the CAS’s Code

The PCS is made up of 9 sections: General, Professional Standards, Standards for Advice, Breach of Professional Guidance, Conflict of Interest, Financial Interests, Appointment of New Adviser, Relations with Other Members, Publicity

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Comparison Table of Precepts, Annotation and StatementsCAS /

ThailandSingapore Malaysia Hong Kong India

1 Professional Integrity

General General General General


Standards of Professional Conduct

Professional Standards

Professional Standards

2 Standards of Practice

Actuarial Advice

Standards for Actuarial Advice

Formulation of Advice

Standards for Advice


Communication of Actuarial Advice

Transmission of Actuarial Advice

Confidentiality

Client Relationships

Relationship with Client


Independence


Independence Conflict of Interest

Control of Work Product

Third Parties

Financial Interests

Financial Interests

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Comparison Table of Precepts, Annotation and StatementsCAS /

ThailandSingapore Malaysia Hong Kong India

3 Courtesy and Cooperation

Relations with Other Actuaries

Relations with Other Actuaries

Relations with Other Members

Advertising Publicity Publicity Publicity Publicity

Appointment of New Adviser



4 Titles and Designations

Descriptions

5 Violations of the Code of Professional Conduct

Discipline Breach of Professional Guidance

Code of Professional Ethics

for Candidates

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Effective with the May 2008 exams Similar to Code of Conduct for

members CAS now consistent with other

societies (e.g. CPCU and CFA Institute) in requiring candidates to abide by ethical standards

New discipline procedure also developed as the ABCD does not have jurisdiction over candidates

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Similarities to Code of Conduct Rule 1: Act honestly and with integrity

and competence, to uphold the reputation of the actuarial profession. (Precept 1)

Rule 2: Not engage in any professional conduct involving dishonesty, fraud, deceit, or misrepresentation or commit any act that reflects adversely on the actuarial profession. (Precept 1)

Rule 3: Perform services with courtesy and respect (Precept 10)

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Similarities to Code of Conduct (cont.) Rule 5: Prohibits use of ACAS or FCAS

designations until admitted to membership by CAS Executive Council (Precept 12)

Rule 6: Prohibits disclosure of confidential information unless authorized by Principal or required by law (Precept 9)

Rule 7: Respond promptly/truthfully and cooperate with investigations (Precept 14)

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Differences from Code of Conduct Areas where candidates cannot be held

to the same standard as members, or areas related to exams

Rule 4: Adherence to the CAS Policy on Examination Discipline

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Differences from Code of ConductPrecepts not addressed by Candidate

Code Precept 2: Qualification Standards Precept 3: Standards of Practice Precepts 4-6: Actuarial Communications Precept 7: Conflict of Interest Precept 8: Control of Work Product Precept 11: Advertising Precept 13: Discussing/Disclosing

Violations

course on professionalism code of professional conduct and code of professional ethics for...

Documents

professional actuary

code of conduct

professional obligations

professional integrityprecept

key definitions

cia members actuarial

abcds jurisdiction

ethical standards