Friday, March 26, 2010

Six Components of the Code Ethics and Seven Standards of Professional Coduct

Code of Ethics
  • Act with integrity, competence, diligence, respect, and in an ethical manner with the public, clients, prospective clients, employers, colleagues in the investment profession, and other participants in the global capital markets.
  • Place the integrity of the investment profession and the interests of clients above their own personal interests.
  • Use reasonable care and exercise independent professional judgement when conducting investment analysis, making investment recommendations, taking investment actions, and engaging in other professional activities.
  • Practice and encourage others to practice in a professional and ethical manner that will reflect credit on themselves and the profession.
  • Promote the integrity of , and uphold the rules governing, capital markets.
  • Maintain and improve their professional competence and strive to maintain and improve the competence of other investment professionals.

The Standards of Professional Conduct

I. Professionalism
  • Knowledge of the Law
  • Independence and Objectivity
  • Misrepresentation
  • Misconduct

II. Integrity of Capital Markets

  • Material Nonpublic Information
  • Market Manipulation

III. Duties to Clients

  • Loyalty, Prudence and Care
  • Fair Dealing
  • Suitability
  • Performance Presentation
  • Preservation Confidentiality

IV. Duties to Employers

  • Loyalty
  • Additional Compensation Arrangement
  • Responsibilities of Supervisors

V. Investment Analysis, Recommendations, and Actions

  • Diligence and Reasonable Basis
  • Communication with Clients and Prospective Clients
  • Record Retention

VI. Conflicts of Interest

  • Disclosure of Conflicts
  • Priorities of transactions
  • Referral Fees

VII. Responsibilities as a CFA Institute Member or CFA Candidate

  • Conduct as members or candidates in the CFA program
  • Reference to CFA Institute, the CFA Designation, and the CFA Program

No comments:

Post a Comment