DSI Core principle 7
Avoid conflicts of interest. In the complex financial sector, it is important to be transparent about (potential) conflicts of interest. Mixing personal and business interests can damage trust in the sector and should be actively avoided.
At DSI, ten core principles are central to our Code of Conduct. They provide financial professionals with guidance to act with integrity every day and strengthen trust in the sector. Every DSI-certified individual commits to these principles, helping us contribute to a transparent and ethical financial sector. Discover all 10 core principles of DSI here.
Learn about real-life integrity dilemmas linked to this core principle
Discover articles 7.1.8 and 7.1.9 from the DSI Code of Conduct that are related to this core principle.
What if you, as a professional, notice an integrity issue?
On 24 June 2021, a certified investment specialist working at an asset management firm was fined as part of a settlement with DSI. The reason: a conflict between personal interests and those of investors.
The specialist had taken a position in the same stock both personally and on behalf of an investment fund managed by his employer. As part of his role, he was authorised to carry out trades for the fund. DSI’s investigation revealed that he used both his personal account and the fund’s account to place opposing orders. He sold shares from his personal portfolio to the fund, and then bought more shares for the fund again.
DSI concluded that this amounted to a conflict of interest, which is a breach of article 7.1.8 of the DSI Code of Conduct. It also emerged that he had failed to follow his employer’s rules on personal trading.
This case directly relates to core principle 7: be clear about your interests. In the financial sector, being transparent about (potential) conflicts of interest is essential. Even if you believe your personal trades are harmless, there may still be a risk of overlap with your professional responsibilities. Always ask yourself: Could my personal interests conflict with those of clients, funds or my organisation in any way? Never act in a way that could undermine trust.
By staying alert to your own role and actively avoiding conflicts of interest, you help maintain the integrity of the sector.
“Be honest about your own interests – and prevent others from having to ask questions later.”
Learn more about this case
Ethical dilemmas are ideally discussed early within your own organization, so you can come to a careful and justifiable decision together. Prevention is better than cure, and integrity should be a constant topic of discussion within teams and the management of organizations in the financial sector.
However, when a situation goes beyond an internal dilemma and potentially involves an integrity violation, financial professionals can report it to DSI. This is based on the DSI Code of Conduct and may lead to disciplinary proceedings. Discover everything about making an integrity report, the DSI Code of Conduct and DSI Ethics Enforcement via the buttons below.