C. Standard III: Relationships with and responsibilities to the Employer

1. III(A) Inform Employers of the code of ethics and standards of professional conduct
Required conduct
Members must inform their immediate supervisor, in writing, that they are required to conform to the Code of Ethics and Standards of Professional Conduct. They are obligated to deliver a copy of the Code and Standards to their supervisor. This procedure is not necessary only if the employer has stated in writing, that the firm’s policies already include AIMR’s Code and Standards.
Compliance Procedures

2. III(B) Duties owed to employers
Required conduct
Do not undertake independent practice in competition with your employer that might result in some compensation or other benefit, unless you have written consent from both your employer and the outside entity (client) to do so.

If a member contemplates performing services for an entity other than his or her employer that could result in compensation, by rendering a service currently available by the employer, a written statement to the employer must be made describing:
a. The types of services offered.
b. The expected duration of the service.
c. The compensation.
No service should be rendered without the current employer’s written approval.
Compliance Procedures

3. III© Disclose conflicts of interest to employer
Required conduct
Members must disclose to employers any material fact that could reasonably be expected to interfere with their duty to the employer, or their ability to act in an unbiased and objective manner. A conflict of interest exists with any situation that would interfere with the member rendering unbiased investment advice, or cause the member not to act in the employer’s best interest. Material ownership of stock, participation in outside boards, and financial or other pressures that may influence a decision should be promptly reported to the employer, so their impact can be assessed and a decision made on how to resolve the conflict.


4. III(D) Disclose additional compensation arrangements
Required conduct
Inform employers in writing of compensation (monetary or other) for services that are in addition to the compensation received from the employer. The employer is entitled to have full knowledge of a member’s compensation arrangements in order to assess the true cost of services, and their likely effects on the employee’s loyalities and objectivity.

Members must make a written disclosure to their employers specifying any compensation they propose to receive, in addition to the compensation received from primary employer.


5. III(E) Responsibility of Supervisors
Required conduct
Members with supervisory responsibility are expected to understand what constitutes an adequate compliance system for their firm and to make reasonable efforts to see that appropriate procedures are established, documented, communicated to subordinates, monitored and enforced. They are expected to have in-depth knowledge of the Code and Standards, and must exercise their responsibility with respect to both persons who hold and do not hold the CFA designation.