Ethics and Trust in the Investment Profession Flashcards
Define Ethics?
Ethics can be described as a set of shared beliefs about what is good/acceptable behaviour and what is bad/unacceptable behaviour.
Define Ethical Conduct?
Ethical Conduct can be described as the conduct that improve the outcome for stakeholders (clients, coworkers, employers, investment professionals as a whole etc…).
Stakeholders are people who are directly or indirectly affected by the conduct.
Ethical conduct is behaviour that balances your self-interests with the impact of others.
Describe the role of a Code of Ethics.
A written set of moral principles describing what is acceptable behaviour.
Good way to communicate values, principles and expectations of a company.
May include rules/standards that require a level of ethical behaviour.
Describe a Profession.
A Profession refers to a group of people with specialised skills and knowledge, agreeing to behave in accordance with a code of ethics.
Distinguish between Ethical and Legal Standards.
Ethical principles often set a higher standard of behaviour than laws or regulations.
New laws and regulations, often resulting from recent instances of unethical behaviour, can create opportunities for more unethical behaviour.
Ethical decisions require more judgement and considerations of the impact of behaviour on stakeholders than legal decisions.
Describe the ethical decision-making framework.
Requires a Code of Ethics to be set.
Identify - relevant facts, stakeholders and duties owned, ethical principles and conflicts of interest.
Consider - situational influences, additional guidance and alternative actions.
Decide and Act.
Reflect - Was the outcome anticipated? Why or why not?
