There must be 50 ways to lift your standards: CFA Institute

Financial analyst organization to unveil 'integrity list'; loftier code of conduct 'meant to be a gut check'

May 4, 2012 @ 11:17 am

By Jeff Benjamin

The CFA Institute's 65th annual conference, which kicks off Monday in Chicago, is expected to include an overt focus on ways to improve the overall image of the financial advice industry.

“We know that the public trust in this profession is at a low ebb right now,” said John D. Rogers, president and chief executive of the organization, which represents more than 109,000 chartered financial analysts from 139 different countries.

“If the CFA Institute is known for anything, it is for our standards for ethics and professional conduct,” he added. “Now is a time for action for our profession to really take the high ground, and that will take more than just subscribing to a code of conduct.”

Along those lines, Mr. Rogers plans to unveil the CFA Institute's “integrity list,” described as a collection of “50 tangible steps that investment professional can take to create this change.”

The list is being promoted as the first step in a long-term campaign to stamp out improper behavior in the industry.

The list, which Mr. Rogers described as part “motherhood and apple pie” and part “very practical,” was created through feedback from the institute's members.

After a request was sent out asking members for ideas of what professionals can do to help restore integrity to the industry, Mr. Rogers said more than 1,500 comments and suggestions came pouring in.

Among the examples that made the final cut include “naming and shaming unethical behavior.”

“Don't just wring your hands if you see a product that is inappropriate, call it out,” he said. “We are in the standard-setting business, so we need to also talk to clients about risk as much as we talk to them about opportunities.”

On the 50-year anniversary of the CFA Institute's original code of conduct, which has seen multiple revisions and additions, the new integrity list is “meant to be a gut check,” Mr. Rogers said.

“No matter where you practice, as an individual, commit yourself to a gold standard code of ethics and professional conduct,” he said. “Strive as best you can toward a conflict-free business model, and try to deal with the conflicts in the interest of the clients if possible.”

Mr. Rogers said he wasn't surprised by the sheer number of responses that came in from members, because “our members are committed to standards, and they are pretty uniformly upset that public trust in our industry has declined so much.”

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