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CFA Level I · CFA Level I Exam · Ethics and Trust in the Investment Profession

A portfolio manager says she always intends to do the right thing, so she sees no need to practice ethical decision-making. Based on the CFA Institute materials, her view is best described as:

Her view is unsupported. The materials say an inclination to do right is no match for the multitude of daily decisions, so ethical decision-making skills must be practiced to develop muscle memory that works despite conflicts of interest. A code of ethics alone is insufficient.

  1. Areasonable, because good intentions are sufficient for fundamentally ethical people
  2. Bunsupported, because ethical decision-making skills must be practiced to build the "muscle memory" needed despite conflicts of interestCorrect
  3. Creasonable, because a firm's code of ethics removes the effect of conflicts of interest

Explanation

The text says nurturing an inclination to do right is no match for the many daily decisions, and skills must be taught, reinforced and practiced. A code is necessary but insufficient and does not remove conflicts.

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