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Code of Conduct

AFMA Code of Conduct

The AFMA Code of Conduct clearly articulates the ethical principles for acceptable standards of behaviour in financial markets and promotes responsible decision making.

All AFMA member organisations and the individuals who represent them are expected to operate with a certain level of integrity, professionalism and competence. This ensures that the people using and relying on Australia’s OTC markets have complete confidence in the market participants representing them.

The Code is presented in two parts – the Ethical Principles and the Guidelines.

 

Frequently Asked Questions

What does the Code consist of?

The Code of Conduct is composed of two elements − the Ethical Principles and the Guidelines. The Ethical Principles articulate the fundamental values that AFMA Member organisations and their staff are expected to reflect in their decisions and behaviour. The Guidelines are designed to assist AFMA members in their understanding and application of the Code of Conduct and are intended as guidance only.

When was this version released?
The updated Code was released in November 2015, and remains current until it is reviewed again.
What is different about the new code of conduct?

Under the direction of a working group composed of senior members of member organisations AFMA has substantially revised the Code of Conduct.

There are two primary differences between the old and new versions of the code. Firstly, the new Code includes an Ethical Principle recognising that member organisations have a broad responsibility to the Australian community to act in a way that ensures that financial markets are fair and efficient. Secondly, the new Code includes several Ethical Principles relating to professionalism, covering both an organisation’s responsibility to equip staff with the skills, resources and support to perform their jobs competently and ethically, and the responsibility of staff to perform their job with integrity and professionalism.

In addition the Code Guidelines cover issues that did not exist or were less prominent when the first version of the Code was published – for example, the use of social media.

To whom does the code apply?

Observance of the Code is a requirement under Clause 6.5 of the AFMA Constitution. Since February 2015, all candidates for AFMA Accreditation must agree to abide by the Code. AFMA Members are expected to adopt the Ethical Principles in their dealings in the Australian financial markets.

Employees of AFMA members have a responsibility to ensure that their conduct adheres to the Ethical Principles.

What is the purpose of the Code of Conduct?

The purpose of the Code is to establish a common understanding of the standard of behaviour expected of all AFMA Member organisations and their employees when conducting business with clients, counterparties and colleagues and when providing financial services to retail and wholesale clients. The Code provides a framework for making decisions in ‘grey’ areas, where there is no clearly articulated rule or legal requirement or where interpretation of principles-based law or rules is necessary.

In the course of their work most individuals will encounter situations where they are required to exercise discretion – for example, when trying to meet a client’s needs or achieve a work-related goal. These situations can be complex and it is often difficult to determine the best course of action. The goal of the Code is to provide a framework for dealing with these issues in an ethical and consistent manner.

Does the Code cover every issue that a professional will encounter when working in financial markets?

No. While adhering to the ethical principles will provide guidance to all of the ‘grey’ areas that you are likely to face working in the financial markets in Australia, the Code does not provide specific direction as to how act in a particular situation. The Code Guidelines may provide some assistance, but it is not exhaustive and does not cover every business activity or every situation that may arise in the course of operating in Australian financial markets.

How should the Code be used?

AFMA Members organisations should endeavour to incorporate the Code into their internal codes and policies, as well as staff induction processes.

The Code also provides a framework for ethical decision making by individuals. If you are confronted with a situation where you are unsure as to the best course of action from an ethical perspective, consult the Code and discuss the problem with your manager and colleagues to determine the principle(s) that are relevant and how they should be applied.

What happens if someone breaches the Code?

AFMA is not a regulatory organisation, and so the Code does not have the force of law and is not binding on members. Most Member organisations have their own internal codes and may utilise other codes for sections of their business – for example, the ACI Model Code. Further, some individuals will belong to professional associations such as a law society or an accounting body, which have their own Codes of Conduct.

AFMA relies on its Member firms to observe the Code and to take appropriate action in response to events that may constitute a breach. In some cases, serious misconduct may also be a breach of the relevant law or regulation.

The AFMA Code provides a sound basis for Members and individuals to evaluate their own conduct. If you believe that you or others in your organisation may have breached the Code, you should consult your manager or compliance team.

Is training available?

Yes. AFMA offers the Professionalism conduct and ethics course which can be run on an in-house basis at your organisation.