The Scottish Financial Risk Academy, the first of its kind in the UK, is to be established by Heriot-Watt University following the award of a £335,000 grant by the Scottish Funding Council (SFC).
The academy will pioneer a new role in providing an enhanced focus for collaboration between Scotland's world class university academia and its financial services industry.
While universities and the industry have established connections in place, the academy will centre on the specialist area of quantitative risk management, an area that is coming under increased scrutiny by the Government, national and international regulators and the general public, following the global financial crisis.
It will provide a new opportunity for sharing knowledge and expertise through a range of activities that will connect with financial services companies across Scotland - and beyond - and provide a vital function in improving understanding of financial risk.
The academy is the brainchild of Heriot-Watt's Professor Alexander McNeil and his colleagues at the Maxwell Institute, a collaborative mathematics research institute combining the strengths of Heriot-Watt and the University of Edinburgh. It has the backing of the industry in Scotland and will be set up in partnership with five key financial organisations; Aberdeen Asset Management, the Actuarial Profession in Scotland, Barrie & Hibbert, Lloyds Banking Group and Scottish Financial Enterprise.
Professor McNeil said: 'This grant is a major achievement and I am delighted that the SFC has recognised the importance of establishing the Scottish Financial Risk Academy, which will provide vastly improved two-way information flow and critical knowledge sharing across the financial services spectrum.
"Following the global financial crisis, we saw the need to create a new communications channel between academia and the financial sector that would enhance the quality and understanding of financial risk throughout the industry, through knowledge transfer.
"At a time of proposed significant changes to the regulation and structure of the financial sector, the academy will cement crucial working relationships and contribute to the debate with the aim of delivering long-term benefits to the wider economy."
The funding is being made available under the (SFC) Scottish Further and higher Education Funding Council's Horizon Fund, which is also funding another Heriot-Watt led project, Mathematical Methods to Support the Integration of Renewables into the Electricity Network, which is receiving £64,671.
The project brings together the major transmission network for the whole of the UK (National Grid) and the second largest supplier of electricity to the UK (Scottish and Southern Energy) to address the implications of the uncertainty in renewable energy sources (wind, wave, tidal) to the UK power transmission network, and ultimately the consumer. It bridges the practical implications on renewable energy provision to the consumer and the economic implications of renewable energy to the supply companies dealing in future trading, and pricing of energy. Academic partners are the Maxwell Institute for Mathematical Sciences (the Joint Research Institute of the University of Edinburgh and Heriot-Watt), and the Energy Joint Research Institute of Edinburgh.
Heriot-Watt is also a partner in two further projects under the Horizon Fund, Developing Crystallisation Science Excellence for Manufacturing Technologies: Oscillated not Stirred, a project grown from an initial collaboration established within ScotCHEM, and Low Carbon Housing in partnership with Edinburgh Napier University and Glasgow Caledonian University.