Sunday, April 28, 2013

Receiving the Odom Visionary Leadership Award

I received the William E. Odom Visionary Leadership Award last Tuesday, April 23, at a ceremony hosted by the Jump$tart Coalition for Personal Financial Literacy. I was a very special evening which will stay forever in my memory.

I had prepared a speech to deliver at the dinner and I provide the text below. Thank you all for your support and for supporting financial literacy.

I am delighted to be here this evening to receive this wonderful honor. When Laura Levine called to tell me about the Odom Award, I was very happy. And contrary to the findings reported in the studies about happiness, I can tell you that my happiness lasted for days and days.

In fact, that happiness lasted until I realized I’d have to give a speech. I was at this event two years ago... sitting at the table of Carrie Schwab when she sang for her award. And I know that John Rogers gave a wonderful speech last year. How do I follow that?   

Like every good Italian, I called my mother. Her first recommendation? No singing or dancing on the stage. That killed my plans for arias from Tosca or any pirouettes. But my mother had some good suggestions. She said, “Why don’t you speak about that PISA project you always tell us so much about? Why don’t you talk about your passions, for example the new center that takes so much of your attention?"
So let me start with PISA, the Programme for International Student Assessment. As most of you know, in 2012 PISA added financial literacy to the topics it measures, together with math, science, and reading. I chaired the group of experts that the OECD brought together to design PISA’s new financial literacy assessment module.

It was a challenging assignment to design questions to measure financial literacy among 15-year-olds in many different countries. But the group brought a rich level of expertise to the task. We had representatives from Treasury departments and from central banks. We had regulators and representatives from the institutions in charge of financial literacy in their countries.

I want to read to you what PISA gauges:
Are students well prepared for future challenges? Can they analyze, reason, and communicate effectively? Do they have the capacity to continue learning throughout life? Every three years the OECD Programme for International Student Assessment answers these questions and more. It assesses to what extent students near the end of compulsory education have acquired some of the knowledge and skills essential for full participation in society.

This could as well serve as a brief description of financial literacy, a skill essential for full participation in society. And as PISA treats it, it is like the other topics we teach in school, math, reading, science.

Over the last 3 years, the Financial Literacy Experts Groups has met in different cities around the world. Our first meeting was in Boston and since then we have been to Paris, Budapest, Melbourne, and Heidelberg. I’d like to say it was a happy project marked by exotic global travel … but in truth it was one of the hardest projects I have ever undertaken. We spent days locked up in hotel conference rooms designing the Financial Literacy Framework. We wrote – and rewrote – the assessment questions many, many times.

Just so you have a sense of how committed we are: We are the only PISA group that asked for an additional meeting so that we could take a final look at the data, examine the findings and, most importantly, discuss how to disseminate this work. Once the data is out, we hope it will drive a big push for financial literacy in schools. Financial literacy makes a difference in the life of young people and we hope we can make a difference with our work and equip the young generations with the skills they need to for full participation in society.

One good feature about working in financial literacy is that it is not hard to be passionate about it. Working with other people who have a passion for this subject is the most rewarding part of what I do. 
My family teases me about the PISA project. I first mentioned it to my parents – and the measurement issues associated with it – during a rather quick phone call while I was on my way to the airport to catch my flight to a PISA meeting. The next day I got two e-mails. My little sister congratulated me … then commented that we are in trouble if an economist is being asked to take measurement of the leaning tower. My older sister, the more pragmatic one, asked if I could please arrange a visit to the tower. They were clearly thinking of a different PISA!

I hope it is clear that in the eyes of my parents I can do anything, even studying or fixing the leaning tower. I think I ended up on the PISA project that was better suited to my skills/talents, but I do believe that one of the reasons why I am here on the podium today is because I was raised in an Italian family with very supportive parents.

And I am grateful to my parents for encouraging me to seek my passion. I found it in financial literacy. I have been working on financial literacy issues for the past 10 years… not only research but also trying to disseminate the results of the research to a much wider audience than academics. I am very proud of the Global Center for Financial Literacy that I am building at the George Washington University School of Business. My collaborators are here today and we are united in this mission to spread financial literacy.  I am also working with many people and institutions who are here today, FINRA Investor Education Foundation, the Council for Economic Education, and the Jump$tart Coalition for Personal Financial Literacy.

I received an e-mail a few weeks ago from a bank in Arizona asking for material we have written. I had no idea who these people were. It turns out that the mother of my colleague, Kristen, had been talking about our center to her friends and one of these friends was contacting us to ask how to help.
When your parents talk about what you do and can relate to what you do, I think you are in a good job! And I don’t just mean Italian parents but also American parents.  

But we need more than passion for our research. We also need funding. Back in 2005, I submitted a letter of interest to a foundation for a new project on financial literacy. One afternoon, while in my office at Dartmouth, I received a phone call. It was the CEO of that foundation. In all of my time as a professor and in the many grants I had submitted, the CEO of a funding agency had never called me. I thought, "This is an organization I want to work with.”

My wish came true. I have been working with the National Endowment for Financial Education and Ted Beck ever since. We turn to him not just for funding, but also for his advice and wisdom. In keeping with my Italian tradition, I think of him as our godfather!

Thank you very much for this award … and for allowing me to take the stage. It was a good thing that I followed my mother’s advice and did not sing and dance. But, if you are interested in the other PISA, please let me know. I’m pretty sure I can arrange a tour.

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