Which of the following can be found in Standard IV?
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A. B. C. D. E.B
Standard IV states: "Members shall make reasonable and diligent efforts to avoid any material misrepresentation in any research report or investment recommendation."
Standard IV of the CFA Institute's Code of Ethics and Standards of Professional Conduct covers the responsibilities of CFA® charterholders and candidates. It includes guidelines and principles related to maintaining the highest standards of professional conduct, integrity, and ethical behavior. Let's go through each answer choice and see which ones can be found in Standard IV:
A. Members must use the CFA designation in a dignified manner. This statement is not specifically addressed in Standard IV. However, it is a general expectation that CFA charterholders and candidates should use the CFA designation in a professional and respectful manner.
B. Members shall make reasonable and diligent efforts to avoid any material misrepresentation in any research report or investment recommendation. This statement is in line with the principles of Standard IV. It emphasizes the importance of providing accurate and honest information in research reports and investment recommendations to avoid any material misrepresentation.
C. Members shall comply with any prohibitions on activities imposed by their employer if a conflict of interest exists. This statement is also in line with the principles of Standard IV. It highlights the responsibility of CFA charterholders and candidates to adhere to any restrictions or prohibitions imposed by their employer, particularly in situations where conflicts of interest may arise.
D. Members shall maintain knowledge of AIMR's Code of Ethics. The CFA Institute, which administers the CFA program, replaced the Association for Investment Management and Research (AIMR) with itself. Therefore, the reference to AIMR is outdated. However, it is expected that CFA charterholders and candidates maintain knowledge of the CFA Institute's Code of Ethics and Standards of Professional Conduct, which is a core component of the CFA program.
E. If members receive material nonpublic information in confidence, they shall not breach that confidence by trading or causing others to trade in securities to which such information relates. This statement aligns with the principles of Standard IV. It addresses the importance of maintaining confidentiality when members receive material nonpublic information, prohibiting them from trading or sharing such information with others for personal gain.
To summarize, the answer choices that can be found in Standard IV are:
B. Members shall make reasonable and diligent efforts to avoid any material misrepresentation in any research report or investment recommendation.
C. Members shall comply with any prohibitions on activities imposed by their employer if a conflict of interest exists.
E. If members receive material nonpublic information in confidence, they shall not breach that confidence by trading or causing others to trade in securities to which such information relates.