CFA Level I · CFA Level I Exam · Guidance for Standard I: Professionalism
A portfolio manager sits on a pension fund's investment committee that is selecting a new equity manager. During the process, he asks one of the candidate firms to make a donation to a local charity he supports. His request is most likely:
The request most likely violates Standard I(B). Members in a hiring role must not solicit contributions that could reasonably influence their decision, and solicitations need not benefit them personally. A request for a favorite charity donation can be perceived as an attempt to influence the manager selection.
- Aacceptable, because he gains no personal benefit
- Ba violation of Standard I(B), even though the benefit is not personalCorrect
- Cacceptable if the charity is registered and the donation is disclosed afterward
Explanation
When serving in a hiring capacity, members must not solicit gifts, contributions or other compensation that could influence decision-making. Solicitations need not benefit the member personally, and requests for charity contributions may be perceived as attempts to influence the decision. Post-hoc disclosure does not cure the solicitation.
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