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CFA Level I · CFA Level I Exam · Guidance for Standard IV: Duties to Employers

An analyst's employer prohibits staff from serving on outside boards, to avoid even the appearance of a conflict of interest. The analyst has been invited to join the board of a local charity, which he believes poses no real conflict. Under the Standards, the analyst most likely:

The analyst must comply with the employer's restriction. Employers may explicitly prohibit outside board membership to avoid even the appearance of a conflict, and members and candidates are required to follow such restrictions, so the analyst's belief that no real conflict exists does not permit him to join.

  1. Amust comply with the employer's restriction.Correct
  2. Bmay join if the charity is a non-profit organization.
  3. Cmay join after informing a client of the position.

Explanation

Employers may prohibit activities such as outside board membership to avoid the appearance of a conflict, and members and candidates must comply with these restrictions. The analyst's own view that no real conflict exists does not override the policy. Informing a client does not replace the employer's permission.

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