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Jackie Hair still remembers the laugh she had to stifle 20 years ago when she saw a peer's business card emblazoned with three lines of professional designations following their name.

"Clearly, they had taken getting designations to a new art form," recalls the corporate director of worldwide risk management at Ingram Micro Inc., the Santa Ana, Calif.-based global information technology distributor.

"I think the distinction comes in as to those designations that are meaningful and those that are just rubber stamp," she says. Hair shies away from naming those "rubber stamp" designations. But she is chairwoman of the Professional Development Advisory Council at the Risk and Insurance Management Society Inc., holds an Associate in Risk Management and is a RIMS Fellow candidate; one can guess where her alliances are.

The RF, a program started in 2003 that features continuing education, is one of the latest designations.

Thanks to a heightened awareness of risk across industries, there has been an increasing demand for education in this field. Educational organizations are enhancing their curricula and some are adding new designations.

The Society of Actuaries, a Schaumburg, Ill.-based educational and research organization focused on development of actuaries, has released its first professional credential in 60 years, the Chartered Enterprise Risk Analyst.

"We don't think that we are competing head to head with other credentials," says Mike McLaughlin, an SOA Board of Governors member spearheading the development of the CERA curriculum. "We looked at them as a barometer of the level of interest that the market had in this whole discipline."

McLaughlin, global leader of the Actuarial and Insurance Solutions practice at Deloitte Consulting LLP, says the CERA was a logical extension of what the SOA was already teaching with its original two designations, the Fellow of the Society of Actuaries and the Associate of the Society of Actuaries, both established in 1949.

The CERA differs from them in its inclusion of actuarial methods and techniques, the range of risks it trains students to evaluate, and, McLaughlin says, its "rigor."

The SOA's tack is to tailor its existing exams into the CERA credential. "We're using that to prove to employers that these are professionals that will look at not just mitigating, not just managing, not just avoiding risk, but look at a broader range of risks to model, assess and quantify," says McLaughlin.

But are these new initiatives based on real market demand, or are they a way to capitalize on the hot topic of risk?

Executives with an Austin, Texas-based risk management and insurance education organization say it's not so much a matter of there being too many designation programs in the marketplace.

Rather, they say it's the quality of the educational experience a designation program provides that is more relevant.

Carolyn Smith, a vice president of marketing with the National Alliance for Insurance Education & Research says her organization treats its basic programs, like its Certified Risk Managers International, as broad-based liberal arts degrees.

She said the strength of the broader-based programs is that they feature face-to-face instruction with working insurance professionals.

The alliance then offers niche designation programs that are only available to graduates of the alliance's first-stage programs.

"We don't let every Tom, Dick and Harry go to these," Smith said.

McLaughlin says some professionals will skip the CERA because it's tough. It requires passing five exams over the course of three to four years.

The RIMS Fellow also may not appeal to everyone, says Hair. In the fifth year of the program, there are currently only 70 official RF designees and 175 candidates enrolled in the program.

"The RIMS Fellow will attract people who have some risk management experience but aren't old and jaded," says Hair. Part of the reason is the continuing education requirement, a factor that differentiates the designation from many others. While it may turn off some people, Hair says it is exactly that factor that makes her so confident of the program's integrity.

"The expectation is it's harder to get, and once you get it, you're not in there for a lifetime," she says. "You've got to continue to take classes and ensure that your education is kept current."

Hair says the RF also gives its designees an edge in finance that will help risk managers communicate with the CFO. That's an all-important skill because there is more interaction between these two parties today than ever before.

The oldest risk management degree is probably the Associate in Risk Management, created in 1965 by what is now known as the Institutes--the American Institute for Chartered Property Casualty Underwriters and the Insurance Institute of America--independent educational nonprofits in the insurance and risk management fields.

The ARM has been attained by 25,000 risk managers and other insurance professionals. In 1999, the Institutes created the ARM-P, a designation paralleling the original but with a focus on public entities. And while risk management is integral to the anchor credential, the CPCU, the Institutes' long list of designations created since the ARM was formed in 1965, do not directly deal with risk management. The ARM is still the industry standby.

"A lot of the fundamental tools are as applicable 40 years ago as they will be 40 years from now," says Rich Berthelsen, director of content development at the Institutes.

Aside from the basics, the curriculum is constantly updated on emerging risks like terrorism, pandemics, cyberrisk and environmental risk, he says. Students provide feedback, as do professors and advisory committees.

TIME FOR A MAKEOVER

Veteran administrators say even seasoned institutions like the ARM need a makeover once every half century or so.

The Institutes and RIMS are cooking up a collaboration to deliver a new designation on enterprise risk management, says Berthelsen. The project is in the early stages now, with a survey expected to reach RIMS members and ARM graduates soon.

The challenge of creating a new designation is less about deciding what to include and more about deciding what not to include. But communicating that to employers, who presumably oversee their risk managers' education, not to mention sign the checks, can be difficult.

"Conceptually, it's a dynamite theory and it makes a lot of sense," says Berthelsen. "Many of us believe it is the future of risk management and is a revolution for this profession. Having said that, we are scrambling to determine how to prove to executive management that this is an approach that should be embraced by an organization."

Peter Miller, president and CEO of the Institutes, says it is critical to get this one right. ERM is such a dynamic field that it's imperative to target the curriculum to what the industry wants.

"We could have developed the course more quickly, but we wanted to make sure that the subject area crystallized to a point where it made sense," says Miller.

A careful approach is best, especially given how skeptical the industry seems to be about all designations, especially new ones.

There certainly are credentials out there that are a little too easy to get or have a little bit faster track, which tend to attract letter hounds like Hair's acquaintance. Most professionals recognize there is such a thing as going overboard.

"If you need to get a wider business card to hold your letters, I think you're going too far," says McLaughlin.

ERIN FOGG is associate editor of Risk & Insurance®.

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October 1, 2007

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