GARP SCR vs. FRM: What’s the Difference and Which Should You Take?

GARP SCR vs. FRM: What’s the Difference and Which Should You Take?

The Global Association of Risk Professionals (GARP) offers two prominent certifications: the Financial Risk Manager (FRM®) and the Sustainability and Climate Risk (SCR®) Certificate. While both programs aim to enhance expertise in risk management, they cater to different specializations and career goals. Understanding the distinctions between these certifications is crucial for professionals seeking to advance their careers in financial risk or sustainability risk management. This article provides an in-depth comparison of the FRM and SCR certifications, helping candidates decide which one aligns best with their aspirations.

Overview of GARP Certifications GARP SCR vs. FRM , GARP SCR, FRM

GARP is a globally recognized professional body dedicated to advancing the risk profession. It offers these two certifications to address evolving risk management challenges in the financial and environmental sectors. The FRM focuses on financial risk management, whereas the SCR is designed to equip professionals with knowledge of sustainability and climate-related risks.

Financial Risk Manager (FRM®) Certification

Program Structure

The FRM certification is a globally recognized credential for financial risk professionals. It is designed for individuals who want to build expertise in market risk, credit risk, operational risk, investment management, and financial regulation. GARP SCR vs. FRM , GARP SCR, FRM

The certification consists of two exams:

• FRM Part I: Covers risk management foundations, quantitative analysis, financial markets and products, and valuation and risk models. This part focuses on fundamental tools and techniques used in financial risk management.

• FRM Part II: Focuses on the application of risk management tools, including market risk, credit risk, operational risk, liquidity and treasury risk, and risk management in investment management.

Each exam is multiple-choice, with Part I containing 100 questions and Part II containing 80 questions. Candidates must pass Part I before attempting Part II.

Eligibility and Requirements

There are no formal prerequisites to enroll in the FRM program. However, to earn the certification, candidates must: GARP SCR vs. FRM , GARP SCR, FRM

1. Pass both Part I and Part II of the FRM exams.

2. Accumulate two years of full-time work experience in financial risk management or a related field. The work experience can be gained before or after passing the exams, but it must be submitted within five years of passing Part II.

Exam Fees and Costs

The cost structure for the FRM exams is as follows:

• Enrollment Fee (One-time for new candidates): $400

• FRM Exam Part I:

  • Early Registration: $600

  • Standard Registration: $800

• FRM Exam Part II:

  • Early Registration: $600

  • Standard Registration: $800

Sustainability and Climate Risk (SCR®) Certificate

Program Structure

The SCR certificate was introduced in 2020 in response to the growing importance of sustainability and climate risk. This certification is aimed at professionals who want to understand and manage the potential impact of climate change on financial institutions and businesses.

The SCR exam is a single, comprehensive assessment that includes 80 multiple-choice questions and two case studies. The exam duration is four hours. The curriculum covers:

• Foundations of climate change

• Sustainability challenges and opportunities

• Climate risk measurement and management

• Regulatory and policy responses to climate risk

• Case studies on sustainability and climate risk scenarios

Eligibility and Requirements

Unlike the FRM, the SCR does not require candidates to meet any work experience requirements. Candidates simply need to pass the exam to earn the certification.

Exam Fees and Costs

The SCR exam has a straightforward cost structure:

• SCR Exam Fee:

  • FRM/ERP Holder: $600 (Early Registration), $700 (Standard Registration)

  • Individual Member: $625 (Early Registration), $725 (Standard Registration)

  • Non-Member: $725 (Early Registration), $825 (Standard Registration)

Comparative Analysis: FRM vs. SCR

Category	FRM	SCR
Focus and Industry Relevance	Ideal for professionals in banking, investment management, insurance, and regulatory organizations focused on financial risk management. Relevant roles include risk analysts, financial analysts, portfolio managers, and regulatory risk professionals.	Designed for professionals involved in sustainability, environmental risk assessment, ESG compliance, corporate sustainability, and regulatory affairs. Suited for risk management, asset management, banking, and consulting firms integrating climate risk considerations.
Exam Structure and Difficulty	Two-part exam requiring extensive preparation, focusing on quantitative analysis and financial risk modeling. Moderate pass rates due to rigorous nature.	Single four-hour exam covering sustainability and climate risk concepts, requiring broad understanding of environmental policies and risk mitigation strategies.
Career Opportunities	Roles include financial risk analyst, market risk manager, operational risk manager, credit risk analyst, and chief risk officer.	Roles include ESG risk management, sustainability consulting, corporate sustainability, climate risk strategy, and sustainable finance.
Cost and Time Commitment	Higher cost due to two-part exam and work experience requirement. Preparation time of 6-12 months per exam.	More affordable, with a one-time fee and no work experience requirement. Preparation time of 3-6 months.

Which Certification Should You Choose?

The choice between the FRM and SCR depends on career goals, industry focus, and personal interests:

• Choose FRM if: You want a career in financial risk management, banking, investment firms, or financial institutions where expertise in credit risk, market risk, and liquidity risk is essential.

• Choose SCR if: You are interested in sustainability, climate risk, ESG compliance, or corporate sustainability initiatives within financial and non-financial institutions.

For professionals who want to integrate both financial and climate risk expertise into their careers, pursuing both certifications could be beneficial. Many financial institutions are increasingly incorporating climate risk assessments into their risk management frameworks, making the combination of FRM and SCR a valuable asset.

Conclusion

Both the FRM and SCR certifications offered by GARP provide specialized expertise in risk management. The FRM is more suited for professionals focusing on traditional financial risk, while the SCR addresses the growing need for sustainability and climate risk expertise. By understanding the differences in scope, cost, exam structure, and career prospects, candidates can make informed decisions about which certification aligns best with their professional aspirations.