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Questions and Answers
What is the main expectation regarding the conduct of a Regulated Person according to CIRO?
What is the main expectation regarding the conduct of a Regulated Person according to CIRO?
According to CIRO, what type of business conduct would be considered detrimental to the public interest?
According to CIRO, what type of business conduct would be considered detrimental to the public interest?
What does CIRO expect regarding the behavior of a Regulated Person in conducting business?
What does CIRO expect regarding the behavior of a Regulated Person in conducting business?
In what situation would any business conduct contravene the standards set forth by CIRO?
In what situation would any business conduct contravene the standards set forth by CIRO?
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What does CIRO expect from the representative regarding compliance with legal, regulatory, and contractual obligations?
What does CIRO expect from the representative regarding compliance with legal, regulatory, and contractual obligations?
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What is the duty of care that Registered Representatives (RRs) must follow to ensure suitability of investment recommendations for clients?
What is the duty of care that Registered Representatives (RRs) must follow to ensure suitability of investment recommendations for clients?
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According to CIRO, what values guide individual behaviors in the context of ethics?
According to CIRO, what values guide individual behaviors in the context of ethics?
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Under which rule section are the standards of care for Discretionary Accounts and Managed Accounts set out?
Under which rule section are the standards of care for Discretionary Accounts and Managed Accounts set out?
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What is the main difference between a Registered Representative (RR) and an Investment Representative (IR)?
What is the main difference between a Registered Representative (RR) and an Investment Representative (IR)?
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Which of the following best describes ethical relativists' belief about moral principles?
Which of the following best describes ethical relativists' belief about moral principles?
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What is the role of ethical managers in an organization, according to the text?
What is the role of ethical managers in an organization, according to the text?
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When making an ethical decision, what constitutes an ethical dilemma?
When making an ethical decision, what constitutes an ethical dilemma?
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In ethical dilemmas involving right versus wrong issues, what makes the decision-making process less of a dilemma?
In ethical dilemmas involving right versus wrong issues, what makes the decision-making process less of a dilemma?
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In ethical dilemmas involving truth versus loyalty, what conflict arises?
In ethical dilemmas involving truth versus loyalty, what conflict arises?
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What type of ethical dilemma involves the conflict between recommending different equity mutual funds based on their performance?
What type of ethical dilemma involves the conflict between recommending different equity mutual funds based on their performance?
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As an investor, what type of ethical dilemma might you face when deciding whether to invest for short term or long term?
As an investor, what type of ethical dilemma might you face when deciding whether to invest for short term or long term?
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What does CIRO expect from its Regulated Persons?
What does CIRO expect from its Regulated Persons?
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Which of the following situations may contravene the standards set forth by CIRO?
Which of the following situations may contravene the standards set forth by CIRO?
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What type of ethical dilemma might a Registered Representative (RR) face when making investment recommendations?
What type of ethical dilemma might a Registered Representative (RR) face when making investment recommendations?
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What is the main expectation regarding the conduct of a Regulated Person according to CIRO?
What is the main expectation regarding the conduct of a Regulated Person according to CIRO?
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What action could subject a Registered Representative (RR) to disciplinary action by CIRO?
What action could subject a Registered Representative (RR) to disciplinary action by CIRO?
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What organization has regulatory power in the Canadian Securities industry?
What organization has regulatory power in the Canadian Securities industry?
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What type of license must a Portfolio Manager have to place orders to buy or sell securities without client approval?
What type of license must a Portfolio Manager have to place orders to buy or sell securities without client approval?
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What is the consequence if a RR does not follow the procedures for achieving KYC (Know Your Client)?
What is the consequence if a RR does not follow the procedures for achieving KYC (Know Your Client)?
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In ethical decision-making, the 'front page test' is used to assess the decision against what criteria?
In ethical decision-making, the 'front page test' is used to assess the decision against what criteria?
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In ethical dilemmas involving 'truth versus loyalty', what type of conflict arises?
In ethical dilemmas involving 'truth versus loyalty', what type of conflict arises?
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What is the focus of 'end-based ethical thinking' in ethical decision-making?
What is the focus of 'end-based ethical thinking' in ethical decision-making?
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In ethical dilemmas involving right versus right issues, what makes the decision-making process a dilemma?
In ethical dilemmas involving right versus right issues, what makes the decision-making process a dilemma?
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What type of ethical dilemma involves the conflict between recommending different equity mutual funds based on their performance?
What type of ethical dilemma involves the conflict between recommending different equity mutual funds based on their performance?
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When facing an ethical dilemma related to short term versus long term investment, what is the main consideration for an investor?
When facing an ethical dilemma related to short term versus long term investment, what is the main consideration for an investor?
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In ethical dilemmas involving truth versus loyalty, what conflict arises?
In ethical dilemmas involving truth versus loyalty, what conflict arises?
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Study Notes
Conduct and Ethics
- A Regulated Person is expected to conduct business in a manner that does not contravene the standards set forth by CIRO, avoiding business conduct detrimental to the public interest.
- CIRO expects Regulated Persons to comply with legal, regulatory, and contractual obligations, and to conduct business in a manner that maintains public trust and confidence.
Standards of Care
- Standards of care for Discretionary Accounts and Managed Accounts are set out in Rule 1300.
- Registered Representatives (RRs) have a duty of care to ensure suitability of investment recommendations for clients, which includes considering various factors, including the client's investment goals and risk tolerance.
Ethics
- CIRO values individual behaviors guided by integrity, fairness, professionalism, and a commitment to excellence.
- Ethical relativists believe that moral principles vary from culture to culture and from person to person.
- Ethical managers play a critical role in promoting an ethical culture within an organization.
Ethical Dilemmas
- An ethical dilemma arises when an individual faces a difficult choice between two or more conflicting options, often involving moral principles or values.
- In right versus wrong issues, a clear moral principle guides decision-making, making the decision less of a dilemma.
- In truth versus loyalty conflicts, a dilemma arises between being truthful and being loyal to an individual or organization.
- Recommending different equity mutual funds based on their performance is an example of a conflict between right versus right, where both options have merit.
- An investor may face an ethical dilemma when deciding between short-term and long-term investments, considering factors such as risk tolerance and investment goals.
CIRO and Regulation
- CIRO expects Regulated Persons to conduct business in a manner that maintains public trust and confidence.
- Failure to follow procedures for achieving Know Your Client (KYC) may result in disciplinary action by CIRO.
- A Portfolio Manager must have a license to place orders to buy or sell securities without client approval.
- The Canadian Securities industry is regulated by CIRO.
Decision-Making
- The 'front page test' assesses a decision against the criteria of whether it could withstand public scrutiny.
- End-based ethical thinking focuses on the consequences of a decision.
- In right versus right issues, the decision-making process is a dilemma due to the difficulty in choosing between two morally right options.
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Description
Explore the concepts of discretionary power in investment and ethical decision making. Learn about the relationships between values, ethics, and ethical decision making in the investment industry.
