Climate change and financial regulation : challenges for the financial sector post the Global Financial Crisis

Regulation has played a significant role in shaping the financial services sector in Australia over the past few decades. Regulatory changes have included the establishment of the Australian Prudential Regulation Authority (APRA), floating the Australian dollar, allowing foreign financial institutions to operate domestically, the introduction of the superannuation guarantee charge, and the removal of interest rate controls. As the economy emerges from the worst financial crisis since the great depression, a new force of change that is recognised as one of the most significant sources of risk and opportunity facing the business community in the foreseeable future is that of climate change. Climate change is expected to be a significant change agent in the financial services sector as extreme weather patterns, sea level rises, and atmospheric changes impact on asset values (both investment and lending), project finance, and risk products. The financial services industry will be particularly affected by these developments, both as a provider of financial products (capital, credit, investment, advice, and insurance), and also through its powerful influence on the economy in terms of capital allocation. In addition, industry constituents will be heavily impacted by government regulation in this area (reporting, emissions trading and environmental policies), with respect to their own business practices and also those of their clients. This study reports the results of interviews conducted with senior members of the finance sector working in the sustainability area to gauge their perceptions of the challenges facing the sector with respect to climate change. Our results confirm that that regulatory intervention will be critical to climate change response gaining traction and momentum. In particular, regulatory certainty will promote engagement, particularly in relation to the Carbon Pollution Reduction Scheme (CPRS), with other developments needed in terms of information disclosure, performance and remuneration, and incentive programs. Accordingly, the significant potential risks and opportunities that climate change presents to the sector, and the broader economy, will in part be managed/realised only if a swift and significant regulatory response is achieved.

Internal audit involvement in enterprise risk management

Purpose The paper examines the impact of internal auditors’ involvement in Enterprise Risk Management (ERM) on perceptions of their willingness to report a breakdown in risk procedures and whether a strong relationship with the audit committee affects such willingness to report. The study also investigates the use of ERM and the role of internal audit in ERM in Australian private and public sector entities. Design/methodology/approach The study uses an experimental design, manipulating (i) the internal auditor’s involvement in ERM and (ii) the strength of the relationship between internal audit and the audit committee. Participants are 117 certified internal auditors. The study also gathers descriptive data on the use of ERM. Findings The study indicates that a high involvement in ERM impacts the perceptions of internal auditors’ willingness to report a breakdown in risk procedures to the audit committee. However, a strong relationship with the audit committee does not appear to affect their perceived willingness to report. The study also finds that the majority of organisations have recently adopted ERM. Internal auditors are involved in ERM assurance activities but some also engage in activities that could compromise objectivity.

Crowdsourcing interactions : using crowdsourcing for evaluating interactive information retrieval systems

In the field of information retrieval (IR), researchers and practitioners are often faced with a demand for valid approaches to evaluate the performance of retrieval systems. The Cranfield experiment paradigm has been dominant for the in-vitro evaluation of IR systems. Alternative to this paradigm, laboratory-based user studies have been widely used to evaluate interactive information retrieval (IIR) systems, and at the same time investigate users’ information searching behaviours. Major drawbacks of laboratory-based user studies for evaluating IIR systems include the high monetary and temporal costs involved in setting up and running those experiments, the lack of heterogeneity amongst the user population and the limited scale of the experiments, which usually involve a relatively restricted set of users. In this paper, we propose an alternative experimental methodology to laboratory-based user studies. Our novel experimental methodology uses a crowdsourcing platform as a means of engaging study participants. Through crowdsourcing, our experimental methodology can capture user interactions and searching behaviours at a lower cost, with more data, and within a shorter period than traditional laboratory-based user studies, and therefore can be used to assess the performances of IIR systems. In this article, we show the characteristic differences of our approach with respect to traditional IIR experimental and evaluation procedures. We also perform a use case study comparing crowdsourcing-based evaluation with laboratory-based evaluation of IIR systems, which can serve as a tutorial for setting up crowdsourcing-based IIR evaluations.

Rudder Roll Stabilisation of Ships

In this chapter, we present a case study of control system design for rudderbased stabilisers of ships using RHC. The rudder’s main function is to correct the heading of a ship; however, depending on the type of ship, the rudder may also be used to produce, or correct, roll motion. Rudder roll stabilisation consists of using rudder-induced roll motion to reduce the roll motion induced by waves. When this technique is employed, an automatic control system is necessary to provide the rudder command based on measurements of ship motion. The RHC formulation provides a unified framework to address many of the difficulties associated with this control system design problem.

Conflicting notions of risk : the chasm of conflict between institutions and the public

The trust and credibility gap between institutional regulators and the public is based on fundamental social and cultural differences related to power and authority. It is also associated with the 'distance' of a bureaucracies from those whom they serve. The nature of public concern about risk may be investigated by considering specific cognitive decision making 'rules' such as 'familiarity' of a hazard or 'voluntariness' of exposure. A more complete appreciation of the 'how' and 'why' of public response to danger from industrial hazards can be gained by appreciating these 'rules' within the broader context of mis-communication between 'elite' regulators and a highly diverse public. If the results of risk assessments are expressed in technical terms alone, it is unlikely that any real communication will occur. Further, if issues related to the 'remote' nature of much institutional decision making are not addressed, closure of the 'gap' may be difficult to bring about.

A Lagrangian approach to nonlinear modeling of anti-roll tanks

This paper presents two novel nonlinear models of u-shaped anti-roll tanks for ships, and their linearizations. In addition, a third simplified nonlinear model is presented. The models are derived using Lagrangian mechanics. This formulation not only simplifies the modeling process, but also allows one to obtain models that satisfy energy-related physical properties. The proposed nonlinear models and their linearizations are validated using model-scale experimental data. Unlike other models in the literature, the nonlinear models in this paper are valid for large roll amplitudes. Even at moderate roll angles, the nonlinear models have three orders of magnitude lower mean square error relative to experimental data than the linear models.

Kalman filtering for positioning and heading control of ships and offshore rigs

In this article, we have described the main components of a ship motion-control system and two particular motion-control problems that require wave filtering, namely, dynamic positioning and heading autopilot. Then, we discussed the models commonly used for vessel response and showed how these models are used for Kalman filter design. We also briefly discussed parameter and noise covariance estimation, which are used for filter tuning. To illustrate the performance, a case study based on numerical simulations for a ship autopilot was considered. The material discussed in this article conforms to modern commercially available ship motion-control systems. Most of the vessels operating in the offshore industry worldwide use Kalman filters for velocity estimation and wave filtering. Thus, the article provides an up-to-date tutorial and overview of Kalman-filter-based wave filtering.

Antispin thrust allocation for marine vessels

In extreme weather conditions, thrusters on ships and rigs may be subject to severe thrust losses caused by ventilation and in-and-out-of-water events. When a thruster ventilates, air is sucked down from the surface and into the propeller. In more severe cases, parts of or even the whole propeller can be out of the water. These losses vary rapidly with time and cause increased wear and tear in addition to reduced thruster performance. In this paper, a thrust allocation strategy is proposed to reduce the effects of thrust losses and to reduce the possibility of multiple ventilation events. This thrust allocation strategy is named antispin thrust allocation, based on the analogous behavior of antispin wheel control of cars. The proposed thrust allocation strategy is important for improving the life span of the propulsion system and the accuracy of positioning for vessels conducting station keeping in terms of dynamic positioning or thruster-assisted position mooring. Application of this strategy can result in an increase of operational time and, thus, increased profitability. The performance of the proposed allocation strategy is demonstrated with experiments on a model ship.

Kinematic models for manoeuvring and seakeeping of marine vessels

The motion of marine vessels has traditionally been studied using two different approaches: manoeuvring and seakeeping. These two approaches use different reference frames and coordinate systems to describe the motion. This paper derives the kinematic models that characterize the transformation of motion variables (position, velocity, accelerations) and forces between the different coordinate systems used in these theories. The derivations hereby presented are done in terms of the formalism adopted in robotics. The advantage of this formulation is the use of matrix notation and operations. As an application, the transformation of linear equations of motion used in seakeeping into body-fixed coordinates is considered for both zero and forward speed.

Pandemic planning as risk management : how fared the Australian Federation?

The role of law in managing public health challenges such as influenza pandemics poses special challenges. This article reviews Australian plans in the context of the H1N1 09 experience to assess whether risk management was facilitated or inhibited by the "number" of levels or phases of management, the degree of prescriptive detail for particular phases, the number of plans, the clarity of the relationship between them, and the role of the media. Despite differences in the content and form of the plans at the time of the H1N1 09 emerging pandemic, the article argues that in practice, the plans proved to be responsive and robust bases for managing pandemic risks. It is suggested that this was because the plans proved to be frameworks for coordination rather than prescriptive straitjackets, to be only one component of the regulatory response, and to offer the varied tool box of possible responses, as called for by the theory of responsive regulation. Consistent with the principle of subsidiarity, it is argued that the plans did not inhibit localised responses such as selective school closures or rapid responses to selected populations such as cruise ship passengers.

Accelerometer data reduction : a comparison of four reduction algorithms on select outcome variables

Purpose Accelerometers are recognized as a valid and objective tool to assess free-living physical activity. Despite the widespread use of accelerometers, there is no standardized way to process and summarize data from them, which limits our ability to compare results across studies. This paper a) reviews decision rules researchers have used in the past, b) compares the impact of using different decision rules on a common data set, and c) identifies issues to consider for accelerometer data reduction. Methods The methods sections of studies published in 2003 and 2004 were reviewed to determine what decision rules previous researchers have used to identify wearing period, minimal wear requirement for a valid day, spurious data, number of days used to calculate the outcome variables, and extract bouts of moderate to vigorous physical activity (MVPA). For this study, four data reduction algorithms that employ different decision rules were used to analyze the same data set. Results The review showed that among studies that reported their decision rules, much variability was observed. Overall, the analyses suggested that using different algorithms impacted several important outcome variables. The most stringent algorithm yielded significantly lower wearing time, the lowest activity counts per minute and counts per day, and fewer minutes of MVPA per day. An exploratory sensitivity analysis revealed that the most stringent inclusion criterion had an impact on sample size and wearing time, which in turn affected many outcome variables. Conclusions These findings suggest that the decision rules employed to process accelerometer data have a significant impact on important outcome variables. Until guidelines are developed, it will remain difficult to compare findings across studies

Evidence based physical activity for school-age youth

Objectives To review the effects of physical activity on health and behavior outcomes and develop evidence-based recommendations for physical activity in youth. Study design A systematic literature review identified 850 articles; additional papers were identified by the expert panelists. Articles in the identified outcome areas were reviewed, evaluated and summarized by an expert panelist. The strength of the evidence, conclusions, key issues, and gaps in the evidence were abstracted in a standardized format and presented and discussed by panelists and organizational representatives. Results Most intervention studies used supervised programs of moderate to vigorous physical activity of 30 to 45 minutes duration 3 to 5 days per week. The panel believed that a greater amount of physical activity would be necessary to achieve similar beneficial effects on health and behavioral outcomes in ordinary daily circumstances (typically intermittent and unsupervised activity). Conclusion School-age youth should participate daily in 60 minutes or more of moderate to vigorous physical activity that is developmentally appropriate, enjoyable, and involves a variety of activities.

Assessing physical activity during youth sport : the observational system for recording activity in children : youth sports (OSRAC:YS)

The purpose of this study was to evaluate the validity and inter-rater reliability of the Observation System for Recording Activity in Children: Youth Sports (OSRAC:YS). Children (N=29) participating in a parks and recreation soccer program were observed during regularly scheduled practices. Physical activity (PA) intensity and contextual factors were recorded by momentary time-sampling procedures (10-sec observe, 20-sec record). Two observers simultaneously observed and recorded children's PA intensity, practice context, social context, coach behavior, and coach proximity. Inter-rater reliability was based on agreement (Kappa) between the observer's coding for each category, and the Intraclass Correlation Coefficient (ICC) for percent of time spent in MVPA. Validity was assessed by calculating the correlation between OSRAC:YS estimated and objectively measured MVPA. Kappa statistics for each category demonstrated substantial to almost perfect inter-observer agreement (Κappa = 0.67 to 0.93). The ICC for percent time in MVPA was 0.76 (95% C.I. = 0.49 - 0.90). A significant correlation (r = 0.73) was observed for MVPA recorded by observation and MVPA measured via accelerometry. The results indicate the OSRAC:YS is a reliable and valid tool for measuring children's PA and contextual factors during a youth soccer practice.

Clinical use of objective measures of physical activity

With measurement of physical activity becoming more common in clinical practice, it is imperative that healthcare professionals become more knowledgeable about the different methods available to objectively measure physical activity behaviour. Objective measures do not rely on information provided by the patient, but instead measure and record the biomechanical or physiological consequences of performing physical activity, often in real time. As such, objective measures are not subject to the reporting bias or recall problems associated with self-report methods. The purpose of this article was to provide an overview of the different methods used to objectively measure physical activity in clinical practice. The review was delimited to heart rate monitoring, accelerometers and pedometers since their small size, low participant burden and relatively low cost make these objective measures appropriate for use in clinical practice settings. For each measure, strengths and weakness were discussed; and whenever possible, literature-based examples of implementation were provided.

Comparison of intensity-based cut-points for the RT3 accelerometer in youth

OBJECTIVES: To compare the classification accuracy of previously published RT3 accelerometer cut-points for youth using energy expenditure, measured via portable indirect calorimetry, as a criterion measure. DESIGN: Cross-sectional cross-validation study. METHODS: 100 children (mean age 11.2±2.8 years, 61% male) completed 12 standardized activities trials (3 sedentary, 5 lifestyle and 4 ambulatory) while wearing an RT3 accelerometer. V˙O2 was measured concurrently using the Oxycon Mobile portable calorimeter. Cut-points by Vanhelst (VH), Rowlands (RW), Chu (CH), Kavouras (KV) and the RT3 manufacturer (RT3M) were used to classify PA intensity as sedentary (SED), light (LPA), moderate (MPA) or vigorous (VPA). Classification accuracy was evaluated using the area under the Receiver Operating Characteristic curve (ROC-AUC) and weighted Kappa (κ). RESULTS: For moderate-to-vigorous PA (MVPA), VH, KV and RW exhibited excellent accuracy classification (ROC-AUC≥0.90), while the CH and RT3M exhibited good classification accuracy (ROC-AUC>0.80). Classification accuracy for LPA was fair to poor (ROC-AUC<0.76). For SED, VH exhibited excellent classification accuracy (ROC-AUC>0.90), while RW, CH, and RT3M exhibited good classification accuracy (ROC-AUC>0.80). Kappa statistics ranged from 0.67 (VH) to 0.55 (CH). CONCLUSIONS: All cut-points provided acceptable classification accuracy for SED and MVPA, but limited accuracy for LPA. On the basis of classification accuracy over all four levels of intensity, the use of the VH cut-points is recommended.