tag:theconversation.com,2011:/us/topics/results-14007/articlesResults – The Conversation2024-03-26T05:37:12Ztag:theconversation.com,2011:article/2265062024-03-26T05:37:12Z2024-03-26T05:37:12ZIf uni marks are going up, does that mean there’s a problem?<p>In 1894, Harvard University commissioned a report on grading standards, <a href="https://www.aeaweb.org/articles?id=10.1257/mic.20130080">due to concerns</a> that:</p>
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<p>Grades A and B are sometimes given too readily – Grade A for work of no very high merit, and Grade B for work not far above mediocrity.</p>
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<p>More than a century later, the fear of declining academic standards continues. In Australia, there are <a href="https://www.smh.com.au/national/nsw/distinctions-with-a-difference-top-grades-double-for-students-at-state-s-biggest-unis-20230628-p5dk6x.html">ongoing media reports</a> about universities awarding increasing numbers of high grades. Evidence has also been found in the <a href="https://www.tandfonline.com/doi/full/10.1080/03075079.2015.1019450">United Kingdom</a> and the <a href="https://amacad.org/sites/default/files/academy/multimedia/pdfs/publications/researchpapersmonographs/Evaluation_and_the_Academy.pdf">United States</a>. Some US studies suggest grade averages have been steadily increasing since at least <a href="https://acsess.onlinelibrary.wiley.com/doi/abs/10.2134/jae.1977.0029?casa_token=orjvRdYkto4AAAAA:oKoTK7wh6Ew3WHhFzise5SSyevXxSFb1q3dn6-KYVwxhZKADfxlBbWis-SQj-_P1j0ijw861SJFCi10z">the early 1960s</a>.</p>
<p>This week, a report by academics at the University of Sydney <a href="https://www.smh.com.au/national/nsw/distinction-the-new-credit-grade-inflation-puts-uni-integrity-at-risk-20240321-p5fe7i.html">found</a> a 234% increase in the number of high distinctions awarded to students at the university between 2011 and 2021 (the university notes it changed its grading model in 2012).</p>
<p>Education experts call this “<a href="https://www.google.com.au/books/edition/Grade_Inflation/EZcMBwAAQBAJ?hl=en&gbpv=0">grade inflation</a>”. It is often presented as a negative, a sign of lowering standards. However, this is <a href="https://www.tandfonline.com/doi/abs/10.1080/02602938.2020.1795617">only one way</a> to look at the phenomenon of marks going up.</p>
<h2>What are grades for?</h2>
<p>Behind concerns about grade inflation are assumptions about what grades are and what they are meant to do. </p>
<p>Several decades ago, assessment used to be “<a href="https://www.tandfonline.com/doi/abs/10.1080/0305498870130207">norm referenced</a>”. This means the performance of students was measured against their peers. In this system, the best students get high distinctions, the worst fail and there’s a bell curve in between. This holds true regardless of the quality of the teaching and the capability of the students.</p>
<p>A high distinction in this system communicates you were one of the best students. It’s a commodity valuable primarily because of its rarity, like a gold medal at the Olympics. It says nothing about what you are capable of, because your performance was entirely judged against what your peers could do.</p>
<p>But norm referenced assessment has since gone out of fashion. In Australia, the <a href="https://www.legislation.gov.au/F2021L00488/latest/text">Higher Education Standards Framework</a> now requires students to be assessed against predetermined standards. If a student meets the standard for a high distinction, they get one. </p>
<p>The mark of high distinction signals they met a very high standard. The performance of their peers does not matter. If there’s a particularly strong student cohort, or improvements to teaching, more people get high grades.</p>
<h2>There has been a change in assessment</h2>
<p>Grades are the product of assessment, so significant changes to assessment in recent years may also have driven grade inflation. </p>
<p>On top of the move towards standards-based assessments, many universities now give students rubrics (or scoring guides) before they begin their work. </p>
<p>These guides tell students how their work will be graded. So it’s no surprise they can <a href="https://link.springer.com/article/10.1007/s10648-023-09823-4">lead to significant improvements</a> in student performance. If we tell students <a href="https://link.springer.com/article/10.1007/s10734-017-0220-3">what good work looks like</a>, they are more likely to be able to do it and achieve higher grades.</p>
<p>Similarly, there is growing attention given to the quality of <a href="https://feedbackforlearning.org/">feedback practices in higher education</a>. We know feedback is a <a href="https://www.frontiersin.org/journals/psychology/articles/10.3389/fpsyg.2019.03087/full">significant part</a> of student learning. </p>
<p>So, in a standards-based grading system, where grades are directly tied to student learning outcomes, this improvement in performance should naturally translate to higher grades.</p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/we-need-to-change-the-way-universities-assess-students-starting-with-these-3-things-203048">We need to change the way universities assess students, starting with these 3 things</a>
</strong>
</em>
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<h2>Other explanations</h2>
<p>There are other explanations for why grades have been going up. </p>
<p>Since 1979, some academics have been arguing <a href="https://www.tandfonline.com/doi/pdf/10.1080/00220485.1975.10845408?casa_token=AoFRErzj3dsAAAAA:O310Pi2mHLhWq9Mal8-hAdZMiu041H220fWXPnmM81N1NYgj6uIa_MFizxF1E6uoKEIxIh9HV7Gnyw">student evaluations</a> drive grade inflation.</p>
<p>This refers to the increasing practice of universities asking students for feedback on their lecturers and tutors, which in turn has an impact on academics’ career progression. </p>
<p>The <a href="https://www.tandfonline.com/doi/pdf/10.1080/00220485.1988.10845263?casa_token=25386ZE1GdkAAAAA:aiiwHSCB8nI2CVtsGirDUTRS5C1vQdtR9Acts3cW-YuCNO2Z_rnNos8OLsr7ZHcPCMabpZUDgm9IQw">logic is</a>, if teachers give students a better grade they will get better evaluation scores. </p>
<p>But while there is <a href="https://www.tandfonline.com/doi/full/10.1080/02602938.2020.1821866?casa_token=U5gWb3TdiQIAAAAA%3A9yUPDxfPlhoNUnxQn2cxBQO9UqXvJDMAI93YoxCq-WHozax3tsFYupBKd8_Wku3Gh4aL1CEJnZlBOA">some correlation</a> between students who get better grades giving better scores to their teacher, it’s not clear if this is a causal link. It might be that successful students like their teachers more, or perhaps students learn more from people they think are good teachers.</p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/we-have-developed-a-way-to-screen-student-feedback-to-ensure-its-useful-not-abusive-and-academics-dont-have-to-burn-it-185041">We have developed a way to screen student feedback to ensure it's useful, not abusive (and academics don't have to burn it)</a>
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</em>
</p>
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<h2>‘Grade improvement’</h2>
<p>Society depends on universities to produce competent graduates and grades are one signal of competence. </p>
<p>But we need to be careful about equating rising grades with declining academic standards. </p>
<p>If better teaching is enabling students to meet a higher standard then <a href="https://poorvucenter.yale.edu/sites/default/files/basic-page-supplementary-materials-files/2002-kohn-dangerous_myth_of_grade_inflation.pdf">it’s not grade inflation</a>, it’s actually “<a href="https://www.tandfonline.com/doi/abs/10.1080/02602938.2020.1795617">grade improvement</a>”.</p><img src="https://counter.theconversation.com/content/226506/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Phillip Dawson receives funding from the Australian Research Council, the Tertiary Education Quality and Standards Agency, the federal Department of Education, education technology hub EduGrowth, and online assessment companies Turnitin and Inspera.</span></em></p><p class="fine-print"><em><span>Thomas Corbin does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Education experts call it ‘grade inflation’. This comes amid reports of more high distinctions being awarded at some Australian universities.Phillip Dawson, Professor and Co-Director, Centre for Research in Assessment and Digital Learning, Deakin UniversityThomas Corbin, Research fellow, Deakin UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/716532017-01-30T11:28:16Z2017-01-30T11:28:16ZLatest school league tables show where you live affects your child’s education<figure><img src="https://images.theconversation.com/files/154295/original/image-20170125-23878-6j9pja.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Better levels of education and higher exam results found in the South of the country.</span> <span class="attribution"><span class="source">shutterstock</span></span></figcaption></figure><p>The results are in, and the so-called north-south divide continues to separate children’s educational outcomes by geography – as the <a href="https://www.compare-school-performance.service.gov.uk/">recently published</a> secondary schools’ performance data from the Department for Education shows.</p>
<p>While there are of course variations within each region, the data – which covers over 4,000 English secondary schools – shows that parents are much more likely to find schools with high level academic performance in the south of the country, <a href="https://theconversation.com/hard-evidence-why-do-students-in-london-do-better-at-school-34090">specifically in London</a>. </p>
<p>On average schools in London outperform those in the north of the country by almost five percentage points.</p>
<h2>Crunching the numbers</h2>
<p>The 2016 data will bear much more detailed scrutiny than previous years, primarily because it contains new measures of student outcomes. So as well as GCSE results, under the new measure, comparisons between pupils’ results at the end of primary school are also now taken into consideration. This is known as pupils’ “starting points”, and means that <a href="https://theconversation.com/why-new-school-performance-tables-tell-us-very-little-about-school-performance-71235">school performance</a> is no longer based solely on final GCSE grades. </p>
<p>In light of these new measures, I’ve analysed the most recent data for secondary schools. To do this, I grouped the data into local authority regions to show how schools in a local area perform. Though this is not to suggest that the local authorities themselves have a significant impact on student outcomes. In each local authority, most – if not all – secondary schools have become academies, over which local authorities have little influence. </p>
<p>To allow for children’s “starting points” as they join secondary school, I included the average key stage two “point score” for a cohort joining secondary school. I then compared this against the percentage of that cohort that achieve five A to C grades including English and maths when they leave school at the age of 16, as can be seen in the graph below. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/154715/original/image-20170130-7663-1j9j932.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/154715/original/image-20170130-7663-1j9j932.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=419&fit=crop&dpr=1 600w, https://images.theconversation.com/files/154715/original/image-20170130-7663-1j9j932.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=419&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/154715/original/image-20170130-7663-1j9j932.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=419&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/154715/original/image-20170130-7663-1j9j932.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=526&fit=crop&dpr=1 754w, https://images.theconversation.com/files/154715/original/image-20170130-7663-1j9j932.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=526&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/154715/original/image-20170130-7663-1j9j932.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=526&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">This graph shows the trend lines for local authorities in London and those in the north.</span>
<span class="attribution"><span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>These results show that London schools are consistently able to achieve five percentage points more on the A to C measure than northern schools, whatever the children’s starting points. This differs from 2015, when the gap narrowed for higher ability cohorts. </p>
<p>My analysis, however, does show that some of the northern local authorities with weak cohorts have made small gains, but at the same time London areas with higher ability children have still accelerated their progress. </p>
<h2>London first</h2>
<p>I <a href="https://www.bera.ac.uk/blog/whats-the-difference">demonstrated elsewhere</a> that while location plays the largest part in accounting for differences between school performance, by far the most important factor is the level of deprivation. This can be measured by families who have been eligible for free school meals at any time over the last six years – known as the “pupil premium”.</p>
<p>Pupil premium funding started in 2010, and has injected huge amounts of money into schools. It has been specifically targeted at those individuals who history shows they are least likely to succeed in school. But questions have rightly been asked about how much difference this has actually made to outcomes. </p>
<p>My analysis shows that the general trend across local authorities tends to be that the higher the proportion of disadvantaged children there are at a school, the lower the percentage achieving five A to C grades – including English and maths. </p>
<p>While this may be no surprise, the data for London authorities shows a marked difference – not just from those in the north but from all other regions. This seems to suggest that it is possible to achieve high outcomes irrespective of the number of disadvantaged children in the cohort. </p>
<p>The graph below shows that in London’s five most deprived authorities, children perform at least as well as they would in many of the most affluent areas of the north.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/154716/original/image-20170130-7693-676br7.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/154716/original/image-20170130-7693-676br7.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=420&fit=crop&dpr=1 600w, https://images.theconversation.com/files/154716/original/image-20170130-7693-676br7.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=420&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/154716/original/image-20170130-7693-676br7.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=420&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/154716/original/image-20170130-7693-676br7.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=528&fit=crop&dpr=1 754w, https://images.theconversation.com/files/154716/original/image-20170130-7693-676br7.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=528&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/154716/original/image-20170130-7693-676br7.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=528&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The proportion of disadvantaged children compared with GCSE grades.</span>
<span class="attribution"><span class="license">Author provided</span></span>
</figcaption>
</figure>
<h2>Postcode lottery</h2>
<p>What all this analysis shows is that there is clearly work to be done, not just in establishing the reasons for these regional differences, but also to understand better the nature of the measures of performance and disadvantage. </p>
<p>For a number of years educators have pointed to the “<a href="https://www.instituteforgovernment.org.uk/sites/default/files/publications/Implementing%20the%20London%20Challenge%20-%20final_0.pdf">London challenge</a>” as an example of sustainable, meaningful school improvement, but to date few areas outside of the capital have been able to match its success. </p>
<p>The reasons for this success will of course be many and varied, and will undoubtedly be influenced by the enhanced levels of funding that London schools receive. This has been estimated to be as much as <a href="http://tonystephens.org.uk/download/xxxx/leadership_and_management/How%20and%20why%20london%20schools%20have%20improved.pdf">£1,000 per pupil</a> – almost double that of other areas. </p>
<p>But not all of London’s success can be attributed to finances alone, because schools here have worked together, to come up with “bespoke solutions” to address the wide range of problems faced by schools in the area. </p>
<p>What all this suggests is that <a href="https://theconversation.com/how-to-close-the-north-south-divide-between-secondary-schools-51607">closing the north-south divide between secondary schools</a> will be difficult, if not impossible in the days of competing multi-academy trusts. And with the loss of geographical coherence, as local authorities wane in influence, it is hard to see a clear way forward. </p>
<p>But given that A-level and university applications suffer from a similar <a href="https://theconversation.com/the-north-south-divide-in-a-levels-explained-64317">regional bias</a>, what is clear is that we need to support and develop the areas outside of London if we want education to stop becoming something of a postcode lottery.</p><img src="https://counter.theconversation.com/content/71653/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Chris Rolph does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Crunching the numbers on the latest school performance data.Chris Rolph, Principal Lecturer in Education, Nottingham Trent UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/640352016-08-18T10:26:51Z2016-08-18T10:26:51ZHere’s what to do if you’re disappointed with your A-level results<figure><img src="https://images.theconversation.com/files/134448/original/image-20160817-3592-cyrnt4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">'OMG, I've failed'.</span> <span class="attribution"><span class="source">Ana Ado/Shutterstock</span></span></figcaption></figure><p>The saying goes “<a href="https://theconversation.com/is-it-true-that-what-doesnt-kill-us-makes-us-stronger-63376">what doesn’t kill you makes you stronger</a>”, and while that may well be the case, you still need to have the right mindset to turn failure into success – especially on exam results day. </p>
<p>This means rather than being overwhelmed by a challenge, you need to find a way to overcome it and learn from the experience so you can succeed in the future. This builds what psychologists call “<a href="https://theconversation.com/winning-a-penalty-shootout-takes-mental-toughness-luckily-that-can-be-taught-24553">mental toughness</a>”, which basically means that you are able to deal with challenges, pressure, and competition irrespective of prevailing circumstances. </p>
<p>People with mental toughness bounce back after a disappointment and see failure as a challenge and a learning opportunity, rather than a setback. The good news is <a href="http://www.tandfonline.com/doi/abs/10.1080/17509840802705938">mental toughness can be learned</a> through experience, so there’s no better time to start than on exam results day – when mental toughness will help you get through the day and help you to assess your future options if you haven’t done as well as you expected.</p>
<h2>Time for self reflection</h2>
<p>You first need to reflect on why you missed the grades. Look at what went wrong and how you might learn from that. <a href="http://qz.com/757875/mo-farahs-third-gold-medal-is-a-win-for-multicultural-britain/">Think about Mo Farah in the Olympics 10,000 metre final</a>. He fell badly and it could have cost him the gold medal. But he got back up, put it behind him and carried on – eventually winning the race. </p>
<p>Don’t dwell on the “failure”. Work out what went wrong, put it to one side, and then start to look forwards. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/134449/original/image-20160817-3602-120daw7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/134449/original/image-20160817-3602-120daw7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=489&fit=crop&dpr=1 600w, https://images.theconversation.com/files/134449/original/image-20160817-3602-120daw7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=489&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/134449/original/image-20160817-3602-120daw7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=489&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/134449/original/image-20160817-3602-120daw7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=614&fit=crop&dpr=1 754w, https://images.theconversation.com/files/134449/original/image-20160817-3602-120daw7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=614&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/134449/original/image-20160817-3602-120daw7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=614&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">I have so much to do today, I will need to meditate for twice as long – so said Gandhi.</span>
<span class="attribution"><a class="source" href="https://commons.wikimedia.org/wiki/File:Almeida_Júnior_-_Moça_com_Livro.jpg">Jose Ferraz de Almeida Júnior//wikimedia commons</a></span>
</figcaption>
</figure>
<h2>It’s good to talk</h2>
<p>However, the worst thing you can do is sweep a bad result under the carpet. Once you’ve worked out where you think you went wrong, it’s important to discuss what’s happened and why. </p>
<p>It’s natural to feel nervous about the future, especially if things haven’t quite worked out how you imagined, and chatting these thoughts and fears through with someone close to you can really help to take a some of the weight off your mind. </p>
<p>Parents, this is where you can step in and encourage your child to open up and let them know you are still there for them.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/134454/original/image-20160817-3573-10hi8p0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/134454/original/image-20160817-3573-10hi8p0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/134454/original/image-20160817-3573-10hi8p0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/134454/original/image-20160817-3573-10hi8p0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/134454/original/image-20160817-3573-10hi8p0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/134454/original/image-20160817-3573-10hi8p0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/134454/original/image-20160817-3573-10hi8p0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Trusted opinions can give invaluable support.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/127107506@N02/15106281058/in/photolist-p1TD4G-aq8ayp-mYdYma-7mK27x-FpYRb-7Huo5b-56xAhe-qNgikS-4DPdh2-b5vRDr-gCTts-BpQFk-4srdeK-6mPLZn-DREYB-58oHyn-eWqsUR-6Novsn-ftkikH-aW3ZF2-eyoUtV-FT4GQK-eysk6G-6TAeQ7-eysiV1-eyrZ9C-eys2oN-eyoRek-eyp35e-eypdir-eyoYhx-eyoVJR-eyoMTa-eys79m-eyp1LR-eyp6x2-eypfAt-eyrVEY-5Qp6zP-eypc8v-eys3w9-eyp5jx-eyoLPz-eys9L9-eyrTmq-eyp8xX-eypeDP-5nA6NP-eysoeG-eypf5V">Moiggi Interactive//Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc/4.0/">CC BY-NC</a></span>
</figcaption>
</figure>
<h2>Don’t be overwhelmed by emotion</h2>
<p>It’s hard not to panic when your social media feeds are full of excited friends off to their first choice of uni. Results day is a big deal, but wallowing in emotion will affect your ability to make all those important decisions yet to come. </p>
<p>Speak to sensible people around you for practical advice and try to think positively. It might feel like everything rests on your grades but actually many universities look at the whole person. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/134463/original/image-20160817-3597-5c1yyh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/134463/original/image-20160817-3597-5c1yyh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=416&fit=crop&dpr=1 600w, https://images.theconversation.com/files/134463/original/image-20160817-3597-5c1yyh.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=416&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/134463/original/image-20160817-3597-5c1yyh.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=416&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/134463/original/image-20160817-3597-5c1yyh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=523&fit=crop&dpr=1 754w, https://images.theconversation.com/files/134463/original/image-20160817-3597-5c1yyh.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=523&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/134463/original/image-20160817-3597-5c1yyh.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=523&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">At times it pays to ditch social media.</span>
<span class="attribution"><a class="source" href="https://commons.wikimedia.org/wiki/File:A_calm_moment_at_lake.jpg">Patrik Jones//Wikimedia Commons</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<h2>But don’t trivialise</h2>
<p>This might be the first major failure you’ve experienced and with emotions running high it is easy to feel like this is the end of the world. Parents can help here by remembering the importance of taking the experience seriously without making things worse. </p>
<p>At this point it might be good to talk about how far you’ve come and how much there is still left to achieve. Not only is this good for confidence all round, but it could also help formulate some interview answers when you speak to universities. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/134468/original/image-20160817-3583-5mwnz4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/134468/original/image-20160817-3583-5mwnz4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=399&fit=crop&dpr=1 600w, https://images.theconversation.com/files/134468/original/image-20160817-3583-5mwnz4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=399&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/134468/original/image-20160817-3583-5mwnz4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=399&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/134468/original/image-20160817-3583-5mwnz4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=501&fit=crop&dpr=1 754w, https://images.theconversation.com/files/134468/original/image-20160817-3583-5mwnz4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=501&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/134468/original/image-20160817-3583-5mwnz4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=501&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The right path might not be immediately obvious.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/richardleonard/104835400/in/photolist-agiUU-3b2oHR-bz1VLS-a7BCA4-q3Qptb-4vmBfp-5CqLzF-eDg1NS-aF11rB-4ZFQDd-DoS3-iRLcB-6oyCaL-8bEnwt-gwjmB-5tnnY-oFPUQw-6PR9BQ-a6hu9C-5CqLLn-nuarvw-29Pqiu-4B7PTE-bVL95E-dBG7v-biqqB-dBbhvV-7YX3ZD-5hjGS1-5CwTuj-aAk6Ef-aNzUv-dDqjkZ-HkV91-kqYiT-pv7nEe-91pcVH-nKNmpE-72U3aV-7YZL2B-w2E7u-8obtZc-HF1k-7aioFT-ozz6Rf-6oVqJY-6ousMe-6U5Tu6-ecXPrv-iRLeF">Richard Leonard//flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<h2>Work out your strengths</h2>
<p>Think about other achievements which show commitment and success, such as playing an instrument, being in a sports team, having a part-time job. Write them down and use them when you speak to universities. </p>
<p>If you’d been predicted high grades but were crippled by nerves on exam day, you’ve obviously got some academic ability and exams only provide a snapshot. Figure out what your strengths are and what makes you stand out against your peers.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/134472/original/image-20160817-3602-hr9eb8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/134472/original/image-20160817-3602-hr9eb8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/134472/original/image-20160817-3602-hr9eb8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/134472/original/image-20160817-3602-hr9eb8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/134472/original/image-20160817-3602-hr9eb8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/134472/original/image-20160817-3602-hr9eb8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/134472/original/image-20160817-3602-hr9eb8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Achievement, focus and dedication have diverse sources.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/hernanpc/23218164373/in/photolist-BnHamR-6x6CnY-ebNcEu-8kLvG5-doD1h2-s6r267-qaW2ab-8vw2Hj-frjSPF-tfNyzr-71d9vB-8vsCQR-dZ1K3a-qSRMd6-99VR7k-pfbnAB-8vwHnS-saT4m2-5qLiGA-9YpM12-et2ViJ-dd7MEk-jReTdF-cSCK9m-pbHKSD-8woHHf-bZiYqj-9xtoe3-oLPrGG-ef8B82-6rknAX-cegLH-sraQGW-eNQ2vu-47ks3X-hmii6e-4p4sUA-hsGCHD-8vtyRx-sdGQ6j-4UJwMq-jWRiVC-k5JM9b-qaqXgK-n5KB9K-wbbG1g-cfyXGq-m796hX-G7GHzo-bUj2u8">Hernán Piñera//flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
</figcaption>
</figure>
<h2>Think outside the box</h2>
<p>You may feel helpless but it’s important to use your time wisely and try and figure out some alternative options. If you’ve fixated on one particular university, does it offer other courses, or is there another university which has a similar feel? </p>
<p>If it’s all about the course, where else offers that programme or can you explore alternative routes like foundation degrees? The process of school, exams and results can feel like a treadmill and clearing can be an opportunity to step off and change direction. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/134459/original/image-20160817-3611-1ce58x5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/134459/original/image-20160817-3611-1ce58x5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=428&fit=crop&dpr=1 600w, https://images.theconversation.com/files/134459/original/image-20160817-3611-1ce58x5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=428&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/134459/original/image-20160817-3611-1ce58x5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=428&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/134459/original/image-20160817-3611-1ce58x5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=538&fit=crop&dpr=1 754w, https://images.theconversation.com/files/134459/original/image-20160817-3611-1ce58x5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=538&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/134459/original/image-20160817-3611-1ce58x5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=538&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Lateral thinking often holds the key.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/m0php/2321945037/in/photolist-4xbzn8-3fCzD8-afck5b-rozGfx-b8yAsK-GwkSXN-sATrK-hBXwSj-bSsKV6-q6Y2eP-oKwmZF-nFA2Z9-q4H5KA-546YSJ-71o1ZB-7RWaZ3-4LDadR-dxwaRr-dU4BRD-bPEMQc-qkSpGL-dgLNXi-pWrdqA-mVTyN-ggc3Pt-pW8qre-8QJjwj-cAgfZd-9YvBgo-axenEm-6v3fPX-rr7qQ5-pZauL1-axCR8j-cnhaJ7-6eKrFM-bDWKtm-9LWYEY-5AgXGH-nu1BCq-cykc15-d1NSAd-8f9dzb-6fZL7K-nDqCbS-TpVod-9yDDPg-9z12oJ-ax2qse-3jUG5Z">Craig Roday//Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc-nd/4.0/">CC BY-NC-ND</a></span>
</figcaption>
</figure>
<h2>Do lunch …</h2>
<p>Or dinner, or a film. Don’t stew at home alone all day as your friends post happy pictures on social media. Plan something low key but positive for the day like a meal at a favourite restaurant with your family – that way you can still have a nice time regardless of the results. </p>
<p>This will also give you a chance to take your mind off things and unwind a bit after the stress of the last few days.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/134464/original/image-20160817-3578-ndl3o6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/134464/original/image-20160817-3578-ndl3o6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/134464/original/image-20160817-3578-ndl3o6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/134464/original/image-20160817-3578-ndl3o6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/134464/original/image-20160817-3578-ndl3o6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/134464/original/image-20160817-3578-ndl3o6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/134464/original/image-20160817-3578-ndl3o6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption"></span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/streetmatt/15774169310/in/photolist-q2UJYo-8saPSr-a8zYco-9pmBT3-iQi928-71n9nG-GTnDjV-a8x6Sp-obkM9p-95LTxK-4NFf3c-uxoiUH-7DzYjT-vmauK-6yAm22-rBARi7-8vHxAq-8EPNNU-mQ1SY8-cXbGhs-aKL9x-9gwbj6-4AT5Np-p18huE-fj84n7-49MD7D-pbLprR-fiPTYv-6HNRj7-5zQeaX-oXoM7E-mizYr-5Wd4Wo-51WSzy-6Jcese-4G1m2v-kW4Xjv-4iaPHz-rrPjMw-jb65e-dUVchc-jhz8BU-8DvGqm-296eqv-5GRLYo-no5Pyn-2n4TYS-fKWK3J-bagPnt-kKWpV1">Matthew G//flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<h2>Realise how far you’ve come</h2>
<p>If you’re struggling to get past your disappointment, think back to when you were doing your GCSEs – maybe even read an essay you wrote back then. See how far you have come. I get my students to keep one of their first year essays then re-read it in class in their final year. They cannot believe how much they’ve improved. </p>
<p>Your A-levels are a big leap from GCSEs and your degree is another step further. As hard as it feels now, once you are at university and having an amazing time this day won’t feel nearly as painful. Just make sure you learn from the experience and build that mental toughness.</p><img src="https://counter.theconversation.com/content/64035/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Myfanwy Bugler does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Not everyone will be celebrating this results day, so here’s a few words of advice for both students and parents, to help put things into perspective.Myfanwy Bugler, Lecturer of Psychology, University of HullLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/548962016-03-14T19:14:11Z2016-03-14T19:14:11ZInsurance outlook: in an era of increasing competition technology will make the difference<p><em>It’s reporting season, and over the past few weeks some of Australia’s biggest companies have been releasing information on how they’re travelling. These reports reflect themes of how things are going in key sectors of the economy. Over coming days we’ll report on the results of some major companies in key sectors, transport, construction, retail, mining, insurance and banking. Today we look at the insurance sector.</em></p>
<hr>
<p>Volatility in financial markets globally and competition from smaller “challengers” like <a href="https://www.youi.com.au/">Youi</a> (an Australian registered company owned by South Africa’s Rand Merchant Investment Holdings) have been driving down big insurance companies’ profits, putting pressure on these companies to find ways of cutting costs.</p>
<p><a href="http://www.apra.gov.au/GI/Publications/Pages/general-insurers-statistics.aspx">Figures released</a> by the Australian Prudential Regulation Authority (APRA) reveal the performance of the Australian insurance sector as a whole.</p>
<p>APRA figures show that revenue is declining across the sector. For the 110 insurers in the Australian market, bottom line profit after tax declined substantially from a combined $4.1 billion to $2.4 billion in 2015, a drop of 73%. </p>
<p>The total cost of claims made by policyholders was effectively flat for 2015, so the main driver of the slump in profit was the downturn in global financial markets. When policyholders pay their insurance premiums, insurers don’t hold these as cash. In fact, of the $119 billion of total assets of Australian insurance companies, less than 2% is held as cash. Instead, a substantial portion – $68.4 billion (57%) – is invested, with over $50 billion held as interest bearing assets such as bonds. </p>
<p>For the 2014 calendar year, investment returns for the sector as a whole were slightly over $4.2 billion, whereas in 2015 investment returns nearly halved to $2.2 billion. In the year ahead there may be more of a threat to insurance companies from investments in the markets.</p>
<p>In the first months of 2016 in Australia, the All Ordinaries Index has fallen nearly 8% and <a href="http://www.allianzgi.com/en/Market-Insights/Pages/Global-Strategic-Outlook.aspx">there are indicators</a> that returns for both global bonds and shares may not improve much in the short term. Australian insurers may have to look elsewhere for returns on investments.</p>
<h2>Increasing competition</h2>
<p>Insurers will need to both increase revenue and decrease expenses to ensure sustainable profitability. The major insurers have embarked on cost cutting plans, which do seem to be having the desired effect. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/113808/original/image-20160303-9463-bgghxe.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/113808/original/image-20160303-9463-bgghxe.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=433&fit=crop&dpr=1 600w, https://images.theconversation.com/files/113808/original/image-20160303-9463-bgghxe.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=433&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/113808/original/image-20160303-9463-bgghxe.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=433&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/113808/original/image-20160303-9463-bgghxe.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=544&fit=crop&dpr=1 754w, https://images.theconversation.com/files/113808/original/image-20160303-9463-bgghxe.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=544&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/113808/original/image-20160303-9463-bgghxe.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=544&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption"></span>
<span class="attribution"><a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
</figcaption>
</figure>
<p>This is important, as challenger companies the likes of <a href="https://www.youi.com.au/">Youi</a> and <a href="https://www.budgetdirect.com.au/great-savings.html?LinkId=09119&dsid=PPC%7cc25%7cag498%7cbudget%20direct%7ce%7cc&adid=46397556950&gclid=CK-0q9mEocsCFYKYvAodg_EFDg&gclsrc=aw.ds&dclid=CPnw-dmEocsCFQmCvQodp14LcQ">Budget Direct</a> are taking a small, but growing, portion of the $16 billion personal insurance market (which includes home, content and motor), currently dominated by <a href="http://www.iag.com.au/results-and-reports">IAG</a> and <a href="http://www.suncorpgroup.com.au/investors/key-dates-events/half-year-results-31-december-2015">Suncorp Group</a>. This level of competition is seen in the APRA figures, which indicate that the while total premiums increased by just under 4%, the number of policyholders also increased (by over 4%), so the premium per policyholder actually declined by 1% from $612 to $605.</p>
<p>This increase in competition doesn’t necessarily mean a price war in the insurance sector. Gary Dransfield, personal insurance chief executive at insurer Suncorp says his company won’t look to recover its <a href="http://www.smh.com.au/business/banking-and-finance/suncorp-feels-the-heat-from-competitors-20151201-glcech.html">lost market share by reducing premiums.</a></p>
<blockquote>
<p>“We don’t think that’s the way to deal with the competitive environment.” </p>
</blockquote>
<p>However, if competition continues to intensify, the ability for insurers to increase premiums is somewhat limited.</p>
<h2>Technology</h2>
<p>Insurers may be able to make savings by improving the use of technology that gives these companies insight into customers’ actions. These technologies include telematics and Big Data. Telematics is the use of communications devices to send, receive and store information relating to a remote object, such as a vehicle. <a href="https://www.mongodb.com/big-data-explained">Big Data</a> relates to large amounts of data creation, storage, retrieval and analysis. Both of these technologies allow insurance companies to better understand their customers.</p>
<p>Which is important, because the purpose of insurance companies is to collect premiums for those they insure, and to pay out to those few who do have to call upon their insurance protection (i.e. for hail damage to a car, or flood damage to a house). A major impact on profitability is the ability of an insurance company to properly assess and price the risk that the company will have to pay out. This is why the premiums for younger drivers are higher, as they judged to be a higher risk of having an at-fault claim. </p>
<p>More detailed information about policyholders improves the ability of insurance companies to do that, and this can occur in a variety of ways. Rather than simply base the risk of the policyholder on general category information such as age, gender, or the postcode where the vehicle is garaged, factors such as the number of kilometres driven, the time of day and location of the driving, and even speed zones provide valuable insights to insurers. </p>
<p><a href="https://www.aami.com.au/car-insurance/safe-driver-smartphone-app.html">AAMI’s safe driver app</a> uses a smartphone to provide such data, while overseas Subaru is one of the first manufacturers <a href="http://www.repairerdrivennews.com/2016/01/05/subaru-liberty-mutual-partner-to-give-starlink-owners-driving-evaluation-telematics-discount-offer/">to link inbuilt telematics to provide data</a>.</p>
<p>Gathered information on customers also assists insurers in other ways. In 2013 <a href="http://www.smh.com.au/business/iag-buys-wesfarmers-insurance-businesses-20131216-2zhb7.html">IAG purchased Wesfarmers’ insurance business</a> for close to $2 billion, allowing it to get a better grasp of consumer choices through rewards cards purchases and permitting it to tailor insurance products accordingly.</p>
<p>The insurance sector is inevitably at the mercy of natural disasters – and Australia has experienced increasingly intense storms, bushfires and cyclones in <a href="http://www.smh.com.au/environment/climate-change/how-did-climate-change-influence-australias-weather-in-2014-20151030-gkmww3.html">recent years</a>. But it is also facing stormy conditions on investment markets and in the competitive landscape. Those insurers that innovate – making the best use of sophisticated data science and financial tools – will weather difficult times best.</p><img src="https://counter.theconversation.com/content/54896/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>David Bond is a member of the Chartered Accountants Australia and New Zealand.</span></em></p><p class="fine-print"><em><span>Anna Wright is a Fellow of the Chartered Accountants Australia and New Zealand</span></em></p>The outlook for the insurance sector will depend less on natural disasters and more on how the big insurers respond to smaller competitors and the use of technology in assessing policies.David Bond, Senior Lecturer, Accounting Discipline Group, University of Technology SydneyAnna Wright, Senior lecturer, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/545422016-02-11T19:01:43Z2016-02-11T19:01:43ZExplainer: what might upset Australia’s ‘rock solid’ banks<p>Market volatility has affected banks internationally in the US, UK and Europe but even though Australian banks remain insulated from turbulence abroad it might not be all smooth sailing. </p>
<p>The MSCI index of global banks has fallen by 16% since the start of the year, while the S&P index for US banks has fallen by 20%. The chief executive of Deutsche Bank (one of the world’s largest banks) was forced to <a href="https://www.db.com/newsroom_news/2016/ghp/a-message-from-john-cryan-to-deutsche-bank-employees-0902-en-11392.htm">announce </a> that his bank was “rock solid” after the share price had fallen more than 30% from the start of the year and rumours circulated of problems with contingent convertible (<a href="http://www.theaustralian.com.au/news/world/the-times/unwanted-coco-bonds-fall-at-first-hurdle/news-story/a6340e71cd995246de3189a952861722">CoCo</a>) bonds. </p>
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<a href="https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=415&fit=crop&dpr=1 600w, https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=415&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=415&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=521&fit=crop&dpr=1 754w, https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=521&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/111098/original/image-20160211-29207-x5swh1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=521&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Bank stocks and the cost of CDS insurance.</span>
<span class="attribution"><span class="source">Datastream</span></span>
</figcaption>
</figure>
<p>The fall in international bank stocks has coincided with a perception of rising risk levels within the banking sector. The iTRAXX CDS index indicates the cost of insuring debt for a selection of global banks – the index increases as the cost of insurance becomes more expensive, indicating the market perceives that the debt is riskier. So far this year the index has risen 65% - the sharpest increase since the European sovereign debt crisis of 2011-12.</p>
<h2>Falling commodity prices are the current focus</h2>
<p>The main source of concern for financial markets at the moment is related to the commodity markets. Past high commodity prices encouraged many firms to invest heavily building huge new mines, liquefied natural gas (LNG) plants, and expanding production in shale oil. This investment required large amounts of borrowing, and banks have provided this directly (loans) and indirectly (purchasing bonds).</p>
<p>In the last year, crude oil prices have fallen 54%, LNG prices have fallen 32%, and iron ore prices are down around 30% (according to Datastream). The result is that many of the projects, some of which are still to come online, are not profitable – some may never be profitable – and the debt may not be repaid. </p>
<p>Credit ratings agencies such as <a href="https://www.moodys.com/research/Moodys-reviews-energy-companies-in-the-US-for-downgrade--PR_342569">Moody’s</a> suggests that much of the debt issued by U.S. energy companies will be downgraded to junk in the near future, while Standard & Poor’s stated that debt at Chesapeake Energy (one of the largest US shale producers) is <a href="http://www.bloomberg.com/news/articles/2016-02-09/chesapeake-credit-rating-cut-deeper-into-distressed-level-by-s-p">unsustainable</a>.</p>
<p>Attempts by the Chinese government at <a href="http://www.theguardian.com/business/2016/jan/12/chinese-efforts-to-talk-up-yuan-fail-to-stop-slide-in-oil-and-stock-prices">intervening in the currency markets</a> have also created volatility for banks. This has served to create a sense of uncertainty within the financial markets – and when this is the case there is often a reduction in the willingness to invest in “risky assets” such as stocks. Unlike in 2008, heavily indebted governments will have much less ammunition to bail out banks that fail this time around.</p>
<p>Longer term, the change in the regulatory environment is affecting the risk-taking ability of banks, and reducing profitability (even viability) of many areas. Increased capital requirements, particularly in areas that regulators deem to be <a href="http://www.ft.com/intl/cms/s/0/a79f8a3c-4070-11e5-b98b-87c7270955cf.html#axzz3zpjUSrrR">too risky</a>, mean that many banks are exiting equity, fixed income, and currency trading – divisions that have previously generated substantial profits for banks. </p>
<p>Of course, there is also ongoing regulatory investigation into a variety of cases of apparent financial market manipulation such as the recent <a href="https://theconversation.com/qanda-what-is-the-libor-scandal-and-why-does-it-matter-45662">LIBOR</a>, and Foreign Exchange, fixing scandals that saw heavy fines imposed on US and European banks. This has even spread to Australia, where ANZ appears to be under investigation by ASIC for <a href="https://theconversation.com/years-on-asic-still-grappling-with-swap-rate-fixing-scandal-35851">possible interest rate rigging</a>.</p>
<h2>Meanwhile in Australia</h2>
<p>In Australia, banks have performed very well over the course of the last five years. At one point in 2012 Australian banks were worth more than the whole of the European banking sector! Record levels of profitability in Australian banks have supported large dividend payments to shareholders and helped push share prices to all-time highs in 2015. </p>
<p>Earlier this week, <a href="https://www.commbank.com.au/about-us/shareholders/financial-information/results.html">CBA announced another rise in earnings</a> for the first half of the year – to A$4.8 billion. Much of this profitability is a result of increasing interest margins. As the Reserve Bank of Australia cash rate has fallen, banks have been quick to cut the rates offered to savers, but slow to pass on the rate decrease to borrowers (if they have done so at all). Even a small increase in this margin can boost profits if total assets are measured in the hundreds of billions of dollars.</p>
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<figcaption>
<span class="caption">Interest margins.</span>
<span class="attribution"><span class="source">rba.gov.au</span></span>
</figcaption>
</figure>
<p>However, this profitability may not last as margins are under pressure on two counts. First, tighter lending standards, particularly for investors, have slowed lending in the housing market. The housing market appears to be <a href="http://www.businessinsider.com.au/anz-australias-softening-housing-market-will-challenge-the-economy-in-2016-2016-1">slowing</a> and this may increase bad debts in the future.</p>
<p>Australian banks are not totally immune to the impact of falling commodity prices, and CBA with ownership of Bankwest may be particularly <a href="http://www.macrobusiness.com.au/2016/02/is-cba-really-worth-it/">exposed</a> to a slowdown in Western Australia.</p>
<p>On the other side of the coin, funding is becoming more expensive for banks at the same time that increased capital requirements require them to hold more. Funding through international sources is particularly scarce (the <a href="http://www.investopedia.com/terms/c/creditdefaultswap.asp">CDS</a> index indicates this is becoming more expensive), and this matters because Australian banks require a substantial amount of offshore funding.</p><img src="https://counter.theconversation.com/content/54542/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Lee Smales does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Commonwealth Bank’s half year results suggest Australian banks are doing well despite the turbulence affecting banks internationally, however they may not be totally immune.Lee Smales, Senior Lecturer, Finance, Curtin UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/353612014-12-15T19:53:42Z2014-12-15T19:53:42ZSo you didn’t get a great ATAR – it’s not the end of the world<figure><img src="https://images.theconversation.com/files/66948/original/image-20141211-6027-16xjlzv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Getting a low ATAR, or not getting the ATAR you need for the university course you want, can seem like the end of the world. But it's not.</span> <span class="attribution"><a class="source" href="http://www.shutterstock.com/downloading_tips.mhtml?code=&id=35012347&size=medium&image_format=jpg&method=download&super_url=http%3A%2F%2Fdownload1.shutterstock.com%2Fgatekeeper%2FW3siZSI6MTQxODI5ODQzOSwiYyI6Il9waG90b19zZXNzaW9uX2lkIiwiZGMiOiJpZGxfMzUwMTIzNDciLCJwIjoidjF8MTAxMjc1ODh8MzUwMTIzNDciLCJrIjoicGhvdG8vMzUwMTIzNDcvbWVkaXVtLmpwZyIsIm0iOiIxIiwiZCI6InNodXR0ZXJzdG9jay1tZWRpYSJ9LCJibGtlbTJpRnR2U0ZLdnlBb3l0ZWllZkozSzQiXQ%2Fshutterstock_35012347.jpg&racksite_id=ny&chosen_subscription=1&license=standard&src=AzLc_a6affDIG5bp_vMaZQ-1-39">Shutterstock</a></span></figcaption></figure><p>The release of this year’s Australian Tertiary Admission Rank (<a href="http://www.uac.edu.au/undergraduate/atar/">ATAR</a>) will result in mixed feelings among school-leavers. There are those who will be elated at having achieved a score that places them in an advantageous position for entry into a university course of their choice. </p>
<p>But for others, learning of their ranking may result in some discouragement and anxiety at the prospect of certain doors being closed to them. What should students do if they are faced with less-than-expected rankings?</p>
<h2>The ATAR is a ranking not a score</h2>
<p>Perhaps the starting point is to place the score into context. It is a ranking, and therefore a comparative score. It locates every student in that particular national cohort, relative to every other student. ATAR scores can thus vary from regional to metropolitan areas, from independent to government schools, from one state to another. </p>
<p>In this regard, every state governs its own entry requirements into local tertiary institutions. For example, the Victorian Tertiary Admissions Centre (<a href="http://www.vtac.edu.au/">VTAC</a>) is the authority overseeing admission into Victorian tertiary institutions. </p>
<p>Entry requirements may vary from other states. A student is free to apply across states and territories to access courses of their choice in line with their ranking.</p>
<h2>Alternate pathways</h2>
<p>Attaining the right ATAR ensures direct access to a particular university course. Students who think they have missed the mark as a result of a lowered ranking should understand that there are alternate pathways to a career of their choice. Changing the institution, rearranging preferences or considering a related course with a lower ranking are all viable options. </p>
<p>For example, a student who wishes to work in the health sciences may have not reached the required score for a specialised science degree. An alternate pathway could be to enrol in a more generalised course, such as a Bachelor of Science, attempting to incorporate some of the specialised units. In the second year of study, an application could be made to transfer into the original course, with a request for Recognition of Prior Learning, and thus secure a place in the desired course. </p>
<p>Course advisers and pathways counsellors at universities can be invaluable points of contact when looking at individual pathways and unique course mapping.</p>
<h2>Considering flexible study options</h2>
<p>A student may have always desired a university education leading to a certain career. However, landing with a lower than estimated ATAR may require a re-appraisal of other post-school options.</p>
<p>There are additional channels to follow, and school-leavers may still reach the same destination. Courses offered at colleges and TAFEs prepare individuals for well-paying, highly regarded occupations, sometimes offering more accessible, practical training to students. </p>
<p>In the workplace, it is the hands-on, real-world training that counts. Having access to a course – no matter what the tertiary environment – which encourages proactive thinking and equips with beneficial concrete knowledge stands to provide a strong basis for success in that vocation. This unprejudiced view of what is on offer is a vital factor to be borne in mind when making decisions about prospective careers.</p>
<h2>Bridging courses</h2>
<p>Many universities now offer bridging – or pre-tertiary – courses to assist students who have scored lower ATARs. These are preparatory courses which serve as a transition for students, frequently offering sound, long-term grounding for success with university study. </p>
<p>The Diploma of Tertiary Studies at Monash University in Victoria, or the bridging courses program at the University of Technology, Sydney, are transition programs aimed at assisting school-leavers with getting ready for university study.</p>
<p>These programs often incorporate units of study related to the student’s desired course of study, consequently offering a targeted package that has significant benefits. It not only places the student in a strengthened position to tackle a full-blown degree course at university, but it increases their chances of success.</p>
<h2>Special entry access schemes</h2>
<p>Finally, students who have scored lower than anticipated ATARs should investigate whether they qualify for Special Entry Access Schemes. Some students may be eligible for additional points based on their backgrounds or their school status. </p>
<p>Special Entry Access Schemes consider personal, cultural and financial circumstances, among other factors, in order to more accurately assess a student’s position when they apply for post-school study. These bonus points could make the difference between acceptance and rejection into preferred courses.</p>
<p>A lower than expected ATAR may not necessarily indicate firmly closed doors. It may require a re-evaluation of your position. Keeping the score in perspective as a ranking, rearranging preferences, considering alternate pathways, contemplating a bridging course or investigating the possibility of special entry access are all worthwhile options. The key is to persevere and understand that there are always opportunities.</p><img src="https://counter.theconversation.com/content/35361/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Pearl Subban does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The release of this year’s Australian Tertiary Admission Rank (ATAR) will result in mixed feelings among school-leavers. There are those who will be elated at having achieved a score that places them in…Pearl Subban, Lecturer, Faculty of Education, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.