General Sessions

General Session I: Chief Risk Officer Roundtable

This session will begin with representatives of the newly formed North American Chief Risk Officers Council (NACRO) discussing the Council’s mission and objectives. We will then move to a discussion among CROs from a broader spectrum of the financial services sector to discuss the challenges faced by today’s CRO.

    Mark Verheyen, Senior Vice President and Chief Risk Officer, CNA Insurance Companies
    Michael Mahaffey, Senior Vice President and Chief Risk Officer, Nationwide Insurance
    Mike Temple, Sr Vice President and Chief Risk Officer, UNUM Life Insurance Company

    Elizabeth Ward, Executive Vice President and Chief Enterprise Risk Officer, MassMutual Financial Group

General Session II: Enterprise Risk Management Blind Spots: Prophets of Emerging Risk

Will we be blind-sided by emerging risks that follow on the heels of one another? Are we biased towards risk-manifested events and outcomes rather than actual rudimentary sources of risks? This general session highlights our “prophets’” thinking on the following:

  • Low frequency/high consequence natural disasters such as earthquakes, tsunamis, tornado outbreaks, and major oil spills that can cause systemic failures have increased in frequency. The Japanese earthquake of 2011 and subsequent tsunami had far reaching implications, including their effects on a major energy source.
  • Energy from oil and other sources is becoming increasingly difficult to obtain at reasonable prices. The squeeze in energy supplies was instrumental in the decision by oil companies to conduct deepwater drilling—a decision that resulted in a major loss in 2010—and in the decision to pursue nuclear electricity, even in earthquake-prone areas. Recent newspaper articles tie the 2008-2009 recession to rising oil prices, and raise the question as to whether rising oil prices will soon cause another recession. Should more time be spent looking at alternative energy sources?
  • Arguments indicate an electromagnetic pulse is perhaps the biggest threat facing the U.S.. Some scientists say that a large pulse from the sun is indeed due. Knowledge of this risk is not widespread as this threat is not well known.
  • How will world population growth and demographic changes affect the availability of water and natural resources and climate change, as well as economies and financial markets?
  • Whether or not there is consensus on the issue of climate change, there is a real need to deal with the changes that we are experiencing such as more extreme weather events, more wildfires, pests migrating northward, water scarcity, and more.
  • Using further credit to fix the financial crises that was caused by unsustainable credit is being critiqued by some experts as a systemic Ponzi scheme that is in and of itself not sustainable. What other countries are subject to an Arab Spring? Will the European Union resolve its sovereign debt crisis and what are the implications of not doing so?
  • Technological innovation is increasing at an exponential pace. Is this “progress” or are new risks being created?

Are we ignoring key sources of these emerging risks and the impact and domino effects that may manifest as regards our human eco-system, let alone economy? Please join this interactive panel (our “prophets”) for an enlightening lively discussion full of debate and discussion.

    Rebecca Scotchie, Vice President, Enterprise Risk Management, Unum
    Alan D. Roth, Vice President & Chief Risk Officer, Advanced Fusion Systems, LLC
    Richard Hokenson, Founder, Hokenson & Company
    Shaun Wang, Chairman, Risk Lighthouse LLC

General Session III: When Black Swans Aren’t: On Better Holistic Assessment and Forecasting of Emerging Global and Country-Level Change

Improved holistic assessment of global change is particularly useful to the risk manager and the risk modeler, especially given the complexity in this changing world environment. As an example of complex adaptive systems, global change is an excellent laboratory for developing techniques to improve forecasting and understanding of these systems.

“Black Swan” thinking claims that events just happen and, thus, you cannot predict them. Making things worse for the risk manager, this thinking claims that such Black Swan events shape the world. Professor Werther takes the position that this paradigm is barely useful analytically and seriously wrong philosophically. Dr. Werther will address the skills and information that is needed to understand emerging whole-system changes in the global system. He will also demonstrate how to improve forecasting for emerging risk by holistically assessing change dynamics for particular markets (countries/societies) from within their particular biases. Dr. Werther’s presentation will include a discussion of the latest emerging trends in the international environment.

    Guntram Werther, Ph.D., Professor, Strategic Management, Fox School of Business, Temple University

General Session IV: Regulatory Update

Christina Urias, who has been heading the NAIC Solvency Modernization Initiative, will discuss the new NAIC ORSA requirements and state-based regulation of insurance company ERM in general. We are hoping to have at least one regulator from the U.K., EU, or Bermuda to discuss similar issues in their jurisdictions. Michael Angelina will discuss how a CRO of a large multinational (re)insurer deals with all of the changes in regulation in the U.S., Bermuda, and the EU. This session will provide attendees with an update on recent ERM regulatory issues, compare and contrast the differing regulatory approaches across jurisdictions, and discuss how insurance company risk professionals cope with the rapidly changing landscape.

    Christina Urias, Director, Department of Insurance, Arizona Department of Insurance
    Michael E. Angelina, Chief Actuary and Chief Risk Officer, Endurance Specialty Holdings, Ltd
    Lawrence H. Mirel, Partner, Wiley & Rein LLP

General Session V: “Really Out There” —Lessons from the Non-Financial Industry on the Evaluation and Treatment of Extreme Events

Most approaches to risk management include a review of numerous historical events. Thousands or even millions of events are commonly used in the measurement of common insurance risks. But even insurance risk modelers are familiar with the difficulties of evaluating events “out in the tail” of the risk distribution. While these events are difficult to measure for financial firms, consider the impact for the risk manager in organizations where health, life, and economic damages from a single event can span decades, affect millions of people, and cost billions of dollars.

In this session, risk management professionals with international industrial perspectives will explore risks their organizations face, how they evaluate them, and how they plan to handle the consequences of a worst-case event. The approaches used by these organizations will provide insight into alternative means of evaluating and treating extreme events. Each participant will provide an overview of their risk management processes. A lively discussion, directed by questions and comments from the audience, will follow.

    Guntram Werther, Ph.D., Professor, Strategic Management, Fox School of Business, Temple University
    James P. Tunkey, Director and Chief Operating Officer, I-On Asia
    Frans Valk, Enterprise Risk Leader, GE Energy