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

An analyst working in a country where local custom tolerates trading ahead of clients argues that the local practice should govern her conduct. Which statement about ethics for a global investment industry is most accurate?

Ethics for a global investment industry should be universal and support trust and integrity above acceptable local or regional customs and culture. Countries may be at different stages of developing standards, but the goal is standards promoting fundamental ethical principles worldwide, so local custom does not override them.

  1. AEthics should be universal and support trust and integrity above acceptable local or regional customs and cultureCorrect
  2. BLocal custom should prevail where a country is at an earlier stage of developing standards of practice
  3. CEthical standards should be set at the lowest common level so that all markets can comply

Explanation

The text says ethics for a global industry should be universal and support trust and integrity above local or regional customs and culture. Countries may be at different stages, but the end goal is rules and standards supporting fundamental ethical principles globally. Option B treats custom as overriding, which contradicts this.

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