Up to Code BY NANCY BEHRENS
A Show of Hands
A PERSON CLOSE TO OUR PROFESSION recently told me that
when a roomful of actuaries was asked if they could quote Precept 1
of the Code of Professional Conduct, not a single hand was raised.
Now, I am guessing that anyone who reads Contingencies on a regular
basis knows that Precept 1 says, “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
Some of you would score extra credit
by recognizing that Annotation 1-1 adds,
“An Actuary shall perform Actuarial Services with skill and care.” While the Code
contains 14 precepts with multiple annotations, none of the other 13 can be violated
easily without also violating Precept 1.
One of my most pleasant volunteer
positions within the profession has been
to facilitate both the Society of Actuar-
ies (SOA) Fellowship Admissions Course
and the SOA Associates Professionalism
Course (note: other actuarial organi-
zations have similar courses). I enjoy
seeing the new people coming into the
profession, with their enthusiasm and
excitement (and not a pocket protector
in sight). Of course, an important part of
these courses is to go through the Code
of Professional Conduct, precept by
precept. The participants consider real-
world situations in which they might
confront circumstances that could put
them in danger of violating the Code.
When these (generally younger) new
professionals read Precept 1, they stop
just short of saying “duh” out loud. I’m
positive they say it under their breath.
After all, why would one study hard, land
a great job, and not perform professional
duties with “skill and care”?
That was my response to the person
who told me that no one could quote
Precept 1. It’s because we all think it’s a
no-brainer, or maybe we just don’t know
the precepts by number. In any case, I’m
confident that most actuaries not only
know that they should use honesty, in-
tegrity, and competence in their work;
they actually do it. Certainly the new
professionals view it that way. They
sometimes have a hard time envisioning
why you would ever change an answer,
fail to work cooperatively with the for-
mer appointed actuary, or be in such a
rush to complete a project that you fail
to examine the data thoroughly.
One benefit of using the case study
method is to have actuaries consider,
in a safe environment, how they might
respond if they were asked to do something that they viewed as a potential
violation of the Code. Members of the
Actuarial Board for Counseling and Discipline (ABCD) frequently speak at local
actuarial clubs to give seasoned actuaries a chance to learn from the case study
method as well.
Owning Precept 1
Still, actuaries do occasionally violate the
Code, some with full knowledge of the
Code and others from lack of familiarity.
If they didn’t, I wouldn’t be able to participate in another very rewarding (note
that I didn’t say pleasant) volunteer experience: being a member of the ABCD.
Almost every time the ABCD receives a
request for guidance, the person calling
actually knows the right answer. The caller is just looking for someone with whom
he or she can talk through the situation.
It’s also telling that when the ABCD receives a complaint, the alleged violation
of the Code often begins with a violation
of Precept 1. Quite simply, the actuary
failed to use “skill and care,” did not act
honestly with integrity and competence, THI