Recognition and Standard of PRM, FRM, and ERP

It's very difficult to ensure that the individuals youThe FRM designation from GARP also carries high
hire into your organization have a recognizedstandards and recognition. GARP reports that
standard of knowledge, experience, and competency.recruiters and hiring managers are now actively
You can certify internally, but this type of programlooking for these certificate holders in order to fill
does not have much meaning outside of yoursenior risk management positions. Given the current
organization. That's why it's necessary to look foreconomic climate, this is certainly a plus in the
external certification sources. And in the case of riskrecognition column. FRM holders make up a fairly elite
management, the three certifications are highlygroup, having slightly less than 18,000 members
visible, recognized, and set standards that will mostworldwide. This creates a highly recognizable standard
likely improve your organization. Let's look at how theas well as a useful network. For example, GARP
PRM, FRM, and ERP standards look, and then discussreports that its 2008 candidates represented 36
how those standards might impact your organization.industry sectors and were working in 168 of the
First, the Professional Risk Manager certification fromFortune 500 companies. A person who receives the
PRMIA seems to have a high level of recognitioncertification can add the "FRM" to the end of his or
throughout the industry. PRMIA defines itsher name, and a potential candidate can even submit
certification as the "benchmark" in global riska resume to see if he or she qualifies for the
management. To begin with, the organization givesexperience requirement.
partial credit toward certification if you hold anotherThe ERP designation carries much of the same
designation, such as Actuarial Fellow, Actuarialstandard and recognition as the FRM certification,
Associate, or Chartered Financial Analyst (CFA), toincluding the network of worldwide certificate-holders.
name a few. This type of recognition means that theHowever, one of the more revealing elements of the
PRMIA puts its certification on the level of otherERP certification is that GARP is planning a continuing
well-known certifications. Because this type ofeducation requirement for its holders. Continuing
reciprocal arrangement exists, you can be assurededucation requirements ensure that certificate holders
that the standard of excellence is high. The PRMhave current knowledge. Consider the state bar
certification carries recognition by universities, includingassociations or even real estate and appraisal
the University of Toronto, Technical University ofprofessionals in the U.S. If a person obtains a
Munich, NYU, and also a group of faculty whocertification with a continuing education requirement,
represent the Sorbonne, the Ecole Polytechnique, andhe or she is signifying a readiness to consistently
the Universite Paris Dauphine.work to maintain the certification and to continually
The PRM designation is used in about 80 countries,uphold the standards required of the certification.
which is, according to PRMIA, more than any of theWhy is recognition and standard important for your
other risk management designations. This alsoorganization? Consider the value that a recognized
indicates a high level of portability for the certification,certification brings. The certification certainly provides
which means that your organization can certainlyvalue for your shareholders, stakeholders, and
benefit if it is international in scope or is planningcustomers. And in this financial environment, any kind
expansion. The PRM certification is also endorsed byof value and standard is going to be vital to the
some of the best-known companies in the business,survival of the organization. Plus, a recognized
including the Canadian Securities Institute,standard may even bring regulatory value. In other
Algorithmics, Lombard Risk, Ernst and Young andwords, regulators are looking for proof that financial
SunGard Trading and Risk Systems. These industryorganizations are actively finding ways to maintain
relationships can help your organization gain a firmerthe highest knowledge, ethics, and accountability. In
footing in the industry.relation to your leadership pool, a certification is of
In regard to standards, the PRM stands out becausedefinite value. As you bring certified professionals in
of the exam format, which is designed from aor certify your existing associates, your pool of
database. This format ensures that a professionalqualified candidates grows. This pool not only
cannot pass the exam with weaknesses in any areas.possesses the competencies that are stated by the
If he or she plans to pass, he or she must be highlyprogram, but also some implied competencies that
prepared in any area as there is no way to predictcome with self-guided certification programs.
where the database will pull questions for theFinally, certifications like these focus on the
individual exam. The exam prep handbook is currentlyadvancement of the profession and not necessarily
in use in 105 countries and is a common referenceeducation for education's sake. This focus ensures
guide in 23 of the world's largest banks. Plus, thethat your certified associates are "A" players - and
exams can be used to test knowledge areas withoutthat they are committed to their respective fields.
going to full certification. For example, you can haveIn our next discussion, we will look at the
members of a certain department take the examscompetencies that certified professionals bring to
that most closely relate to their expectedyour organization, both as expressed and implied
competencies. It's obvious that the PRM designationcompetency.
is well recognized for its high standards.