When Science Meets Finance

Date: Friday 17 March 2023, 12.00PM
Location: Online
Online - joining instructions will be sent to those registered
Special Interests Group Meeting


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It is a popular conception that commercial interests are necessarily in conflict with science. This is not true. The rapid development of nautical science from the eighteenth century onwards was almost entirely down to commercial pressure for commodities like spice and tea to arrive quickly and safely to their destination. The acceptance of the Arabic numeral system in the 13th century West was prompted by the business need for effective conversion of currency and calculation of profit and interest. However, commerce and science are often in conflict. For a long time the tobacco industry sought to influence science by funding research that favoured its interests and by criticising research that damaged these interests, and there are many other examples. In this talk Dean Buckner will address the problem of the conflict between the science of valuation and risk management in finance and the powerful commercial interests of the industry that sells products like savings and insurance to the public. He will examine the various mechanisms – regulatory, professional, parliamentary, judicial, academic etc – by which science and society can attempt tame the power of financial interests. He will compare their strengths and weaknesses, and propose ways in which they could be made more effective, illustrating this with case studies based on his experience as a practitioner and regulator.

 

Dean Buckner retired in 2018 after working at the Prudential Regulation Authority (PRA) and its predecessor regulators for nearly 20 years. He specialised in derivative and asset valuation, and capital modelling in both the banking and life insurance sectors. He was instrumental in strengthening the capital adequacy and valuation rules applying to institutions holding equity release mortgages.

 
Contact Jia Shao for RSS Finance & Economics Section