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FSRE - Josh > Topic 11 - Ethical principles and professional behaviour > Flashcards

Topic 11 - Ethical principles and professional behaviour Flashcards

1
Q

Give the definition of values

A

Fundamental beliefs that guide or motivate actions, help to judge what is important

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2
Q

What are the different types of values

A
  • Personal
  • Cultural
  • Religious
  • Business
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3
Q

Give the definition of morals

A

Set of beliefs about standards of good and bad behaviour

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4
Q

What are the different types of morals

A
  • Individual
  • Societal
  • Business
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5
Q

Give the definition of ethics

A

Ethics and morals are very similar;
Morals are the beliefs, ethics are morals turned into actions

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6
Q

What is the main objective of a business

A

To make profit!

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7
Q

What is greenwashing

A

When a company pretends to produce positive environmental outcomes through its products, activities and policies, when this is not the case

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8
Q

What is the regulatory sandbox

A

Something the regulator introduced as a way for firms to try new ideas without fear of sanctions

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9
Q

When talking about ethical theories, what are the 3 broad categories

A
  • Normative (or prescriptive)
  • Meta-ethics
  • Applied ethics
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10
Q

What is normative ethics

A
  • Looks at crtieria for differentiating right and wrong
  • Split into 3 main sub-theories:
  • Consequentialist
  • Deontological
  • Virtue (artistotelian)
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11
Q

Key features of consequentialist ethics

A
  • Morally good action results in good outcome
  • ‘ends justify the means’
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12
Q

Key features of deontological ethics

A
  • Based on adherence to rules rather than right or wrong outcomes
  • ‘means are more important than the end’
  • one set of ethical rules in society which should always be followed
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13
Q

Key features of virtue (aristotelian) ethics

A
  • Looks at moral character rather than type of action or outcome
  • Action would be a good action if takne out by a good person
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14
Q

What is the definition of applied ethics

Ethics in business

A

Applied ethics considers the treatment of moral issues, practices and policies in personal and business situations, taking into account the wider context to identify the correct course of action from a practical perspective.

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15
Q

What are the 4 main drivers for the increasing importance of ethical business practices

A
  • Stakeholders/shareholders - expect higher ethical standards to make the busines more attractive and competitive
  • Information transparency
  • Consumer demand for ethical procedures - can complain much more easily nowadays and just expects more
  • Regulation
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16
Q

Benefits of an ethical approach

A
  • Customers put ethical behaviour high on their list, so keeps firm competitive and attractive if long-term solution is in place
  • Trust produces loyalty
  • Chance for new customers to financial services
  • Recruitment and staff retention - 42% of UK employees want to work for ethical employers
  • Investment
  • Regulation - more likely to be in the ‘good books’
17
Q

What are the common characteristics of ethical behaviour in the business

BIG CIRCLE DIAGRAM IN THE BOOK

A
  • Transparency
  • Communication
  • Excellence .
  • Equality
  • Respect
  • Trustworthiness
  • Responsibility/accountability
  • Integrity
  • Professionalism
  • Compassion/empathy
  • Compliance
  • Loyalty
  • Social and environmental consciousness
18
Q

Who is the IBE

A
  • Institute of Business Ethics
19
Q

What 2 sets of rules/principles have the FCA made that have helped towards the implication of ethical business behaviours

A
  • Principles for business
  • Individual conduct rules
20
Q

What is meant by whistle blowing

A
  • Providing information about someone’s wrongdoings
  • FCA launched a facility where this is possible and employee stays protected
21
Q

What do many institutions publish, giving a commitment to stakeholders to act with integrity and fairness

A

Statement of ethical principles

22
Q

What is an example of a stakeholder

A
  • In a corporation, a stakeholder is a member of “groups without whose support the organization would cease to exist”
  • Shareholders
  • Employees
  • Suppliers
  • The community
  • The environment
23
Q

What is the definition of ‘professionalism’

A

Describes the qualities, skills, competence and behaviours an individual demonstrates (or should demonstrate) when carrying out their role

24
Q

What is meant by the phrase ‘competence is not static’

A

Once deemed competent, that is not all that has to be done, you have to remain competent and keep up to date

25
Q

What are the 3 parts to the assessment of competence for an investment adviser

A
  1. Knowledge on their areas of advice
  2. Appropriate skills required
  3. Gaining qualification deemed appropriate by the FCA
26
Q

How long do trainee advisers and mortgage advisers have from the start of their activity to get qualified

A

48 months

27
Q

Once deemed competent, what must you obtain annually from an accredited body to ensure you have ongoing competence

A

Statement of professional standing (SPS)

28
Q

What does a statement of professional standing (SPS) include

A
  • Name
  • Name and details of accredited body
  • End date of verification (12 months from claiming)
  • Confirmation that adviser is qualified
  • Confirmation that adviser signed declaration that knowledge is up to date and their adherence to ethical behaviour
29
Q

What is Continuing Professional Development (CPD)

A
  • For individuals that have attained competence, now have activities tailored to their needs
  • CPD geared towards maintenance and enhancement of competence
30
Q

How many hours of structured and unstructures CPD must be completed annually

A

35 hours of CPD in total, 21 of those structured

31
Q

What is the definition of structured CPD and what are some examples

A
  • Activity with a defined learning outcome
  • Seminars
  • Lectures
  • Conferences
  • Courses
  • Workshops
  • Appropriate E-learning

FSRE - Josh (18 decks)

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