With its examination-based credentialing process, the Casualty Actuarial Society would seem to have created the perfect meritocracy: If you are smart and work hard, the thinking goes, you will pass the exams, get your credential and have a successful actuarial career.
Not quite, unfortunately.
Several barriers to success — before, during and after the exam process — seem to curtail underrepresented groups from attaining CAS membership, which skews predominantly male and white.
At the CAS Spring Meeting in Boston, the meritocracy myth was challenged head-on in the opening general session, “Think You Know About Diversity and Inclusion? Three Perspectives That May Surprise You.”
Mallika Bender, an FCAS and consultant at Willis Towers Watson, and chair of the CAS Diversity Committee, documented the skewness of the CAS membership as of 2016:
- 70 percent of CAS members are male; 30 percent are female.
- 74 percent are non-Hispanic white and 21 percent Asian.
- Less than 5 percent are Hispanic or African-American or other.
By contrast, 59 percent of actuarial science majors in 2016 were male and 68 percent were non-Hispanic white. Perhaps the CAS is on the cusp of progress as new students enter the profession. Or perhaps this is a sign of the challenge some groups face achieving their career goals.
Most actuaries acknowledge the issue. More than 80 percent of respondents to a survey commissioned, in part, by the CAS, indicated that the profession is not as diverse as it could be or should be, said Lori Bailey, global head of cyber risk and head of the Women’s Innovation Network (WIN) at Zurich Insurance. She noted four challenges that underrepresented populations face.
Self-examination is the way to overcome our internal biases.
Barriers to entry. Many people well suited to be actuaries don’t know the profession exists — the ultimate barrier to entry. To that end, the CAS and other actuarial organizations sponsored a High School Actuarial Day in Chicago in April. The event focused on introducing persons of color to the profession, with more than 300 students from 14 high schools attending.
Workplace culture. More than half of those surveyed had either experienced or heard of discrimination in the workplace.
Unconscious bias. Not just race or gender, but name, appearance or school affiliate may unintentionally elicit prejudice. Panelist Erika Schurr, a Fellow of both the CAS and the Canadian Institute of Actuaries, and VP and chief actuary for Travelers Canada, noted that rooting out unconscious bias is at the heart of the profession. Think: Bailey minimum bias procedure — “We [actuaries] think about it in our work all the time,” Schurr said.
Confidence. This fourth item was an important focus of Bailey’s talk. It can be a difficult barrier because confidence changes over time and some of the barriers are, at least in part, self-imposed.
Bailey pointed to surveys that indicate that, as their careers begin, women have higher aspirations than men — more want to reach top management — and are just as confident they can reach their dreams.
The ambition, though, ebbs as their careers evolve. Experienced female employees express less aspiration to reach the top and fewer are confident they will make it.
Why does this happen? Bailey cited three factors:
Biology. There is scientific evidence which suggests that certain genes associated with risk taking are more prevalent in men than in women.
But that’s only one part.
Schooling. Girls tend to be raised as rule-followers. “We are trained early to work hard, get good grades, do well,” Bailey said. “This leads to perfectionism, and that perfectionism leads to a fear of failure” — as in turning away from the profession after the first failed exam.
Workplace setting. At work, Bailey noted, “You want to see that you fit in.” If there is a lack of diversity — a lack of role models — that “ultimately impacts one’s confidence.”
She cited four important elements to focus on in order to build confidence:
- Competence: the technical skills and acumen required to do one’s job.
- Character: the values and attributes one brings to any interaction.
- Comfortability: how genuine you are in your interactions.
- Consciousness: the ability to “understand yourself … and be able to act accordingly.”
Women often focus solely on competence and fail to realize that all of these components are required for ultimate success.
Schurr said that self-examination is the way to overcome our internal biases. She went on to explain that we have to recognize the biases we all harbor — intentional or not — and offered restaurants as a nonthreatening example. If you get lousy service one time at your favorite restaurant, you will probably dismiss it as an aberration; You are biased favorably toward the restaurant. If it’s a new restaurant and service is poor, you are unlikely to return; You are biased against that restaurant.
If you recognize the bias or the filter, then you can work to overcome it, tapping into the curiosity that most actuaries possess. Ask yourself, “Why am I using only this filter?” As an example, she acknowledged that, as a Canadian and University of Waterloo graduate, she had once found herself partial to actuarial candidates from that particular actuarial program.
However, studies have found that companies with more diverse workforces actually return better earnings and generate better income, and Schurr explained that a diversity of thought in her team provides “new ideas that translate into innovation.” She went on, “Given how insurtech is challenging our industry, don’t you want that innovation on your team? Don’t you want that as your competitive advantage?”
The final panelist, Dawn Frazier-Bohnert, SVP and chief diversity & inclusion officer for Liberty Mutual Insurance, outlined how her company extended the idea of inclusion to everyone, specifically men. Her point: Gender means men and women; races mean all races.
Liberty’s program, Frazier-Bohnert said, was called the Men as Allies initiative. The company wanted to find out how men feel about the evolution towards greater diversity in the workplace that surrounds them. “Did they feel included?” she said. “What did they need?”
“We didn’t want to do something to men. We wanted to include them.”
The program involved a 2017 retreat at which men were invited to talk about the challenges they face in the workplace — their child-care issues, the disabilities that challenge some, the fact that some work events allow a man to attend with a wife, but not with a partner.
“We need to call out diversity,” Frazier-Bohnert said. “We want to welcome those differences” so people can be valued for the ways that they are different.
Want to learn more? The Spring Meeting session was webcast and recorded, and the recording, including video, audio, and PowerPoint slides, can be viewed on the CAS website via http://bit.ly/CASSpring18Webcast. (Note: Dawn Frazier-Bohnert’s portion of the session was not permitted to be recorded.)
James P. Lynch, FCAS, is chief actuary and director of research for the Insurance Information Institute. He serves on the CAS Board of Directors.