Ethics in Finance - Prompt Post
In the business of finance, it is immensely important to follow a code of ethics because people’s entire life savings and well-being is being trusted to a financial manager, and if there isn’t a code of ethics, workers with the wrong intentions could end up leaving individuals without the money they have worked very hard for. Many different companies have adopted Where I found a great explanation on ethics in finance was the Certified Financial Planner Board of Standards, which is an organization that sets standards for financial planning by enforcing companies to meet their requirements for certification. On their website, they had seven principles for ethics and professional responsibility, those principles were integrity, objectivity, competence, fairness, confidentiality, professionalism, and diligence. You can read a more in depth explanation of their code of ethics here.
When I think of ethics, I think of doing the right thing, especially when nobody is looking. Therefore, I see this code of ethics being similar to what I believe in, because if I was a client looking for financial advice, I would want people handling my money that are going to keep my best interests in mind and do their best to make smart, educated decisions that benefit me. It is important that financial companies are ethical because the amount of money they handle plays an integral role in the economy, if they are acting unethical it can cause a long list of problems for themselves, their customers, and the entire economy.
The ethical code of finance is well known because it applies to most people and it is arguably the most important in the world. Ethics in finance has been a longstanding problem, as there have been many instances of companies not following their codes, and the result of this is a continued reputation of bad ethics. A great example of this problem was the financial crisis that started in 2007. At this time, financial companies were practicing what most consider to be unethical tactics, which led to the economy crashing and many people losing their jobs. Mortgage companies were giving out loans with little interest, this led to banks creating too much money and running up debt that became unpayable, which led to a wealth of problems. More recently, Wells Fargo was involved in a banking scandal where employees were putting money in accounts without customers’ consent. There have been more documented examples of poor ethical choices, and what this does is cause a continued bad reputation around the financial industry. Unlike other business too, finance does not sell goods and services, it is based strictly on handling money, and with money people can become greedy and bend the rules. In terms of how this impacts me, I know that I am entering a field where people have serious suspicions about what people in my industry do. And the way I see myself probably having to work around this is keep honest and build strong relationships with clients, that way they will have trust in me and not have to worry about my intentions.
When I think of ethics, I think of doing the right thing, especially when nobody is looking. Therefore, I see this code of ethics being similar to what I believe in, because if I was a client looking for financial advice, I would want people handling my money that are going to keep my best interests in mind and do their best to make smart, educated decisions that benefit me. It is important that financial companies are ethical because the amount of money they handle plays an integral role in the economy, if they are acting unethical it can cause a long list of problems for themselves, their customers, and the entire economy.
The ethical code of finance is well known because it applies to most people and it is arguably the most important in the world. Ethics in finance has been a longstanding problem, as there have been many instances of companies not following their codes, and the result of this is a continued reputation of bad ethics. A great example of this problem was the financial crisis that started in 2007. At this time, financial companies were practicing what most consider to be unethical tactics, which led to the economy crashing and many people losing their jobs. Mortgage companies were giving out loans with little interest, this led to banks creating too much money and running up debt that became unpayable, which led to a wealth of problems. More recently, Wells Fargo was involved in a banking scandal where employees were putting money in accounts without customers’ consent. There have been more documented examples of poor ethical choices, and what this does is cause a continued bad reputation around the financial industry. Unlike other business too, finance does not sell goods and services, it is based strictly on handling money, and with money people can become greedy and bend the rules. In terms of how this impacts me, I know that I am entering a field where people have serious suspicions about what people in my industry do. And the way I see myself probably having to work around this is keep honest and build strong relationships with clients, that way they will have trust in me and not have to worry about my intentions.
Works Cited
“Ethics in Finance: Why Is It Such a Problem? | The European Financial Review | Empowering Communications Globally.” The European Financial Review www.europeanfinancialreview.com/?p=4904.
“For CFP® Professionals.” Code of Ethics - Professional Responsibility - CFP Board, www.cfp.net/for-cfp-professionals/professional-standards-enforcement/standards-of-professional-conduct/code-of-ethics-professional-responsibility.
Hec. “How to Make Finance Rhyme with Ethics.” HEC Paris, www.hec.edu/Masters-programs/News/2016-10-06-How-to-make-finance-rhyme-with-ethics. (Image Credit)
Mojonnier, Tim. “Leadership.” Business Theory, 10 Feb. 2012, businesstheory.com/announced-25-billion-settlement-homeowners-ethical/.
“What Caused the Financial Crisis & Recession?” Positive Money, positivemoney.org/issues/recessions-crisis/.
Hec. “How to Make Finance Rhyme with Ethics.” HEC Paris, www.hec.edu/Masters-programs/News/2016-10-06-How-to-make-finance-rhyme-with-ethics. (Image Credit)
Mojonnier, Tim. “Leadership.” Business Theory, 10 Feb. 2012, businesstheory.com/announced-25-billion-settlement-homeowners-ethical/.
“What Caused the Financial Crisis & Recession?” Positive Money, positivemoney.org/issues/recessions-crisis/.
Comments
Post a Comment