Employer Duties: Supervision Responsibilities

Hard Cfa Institute Code And Standards Employer Duties - Supervision

During a quarterly compliance review, a compliance officer at an investment management firm discovers that several junior analysts have been executing trades without properly documenting their rationale and decisions. The compliance officer raises this issue with the firm’s management, highlighting concerns about inadequate supervision of these junior staff members. According to the CFA Institute Code of Ethics and Standards of Professional Conduct, what is the primary duty of the firm's management in this situation?

To ensure that all employees are adequately trained on compliance procedures, regardless of their experience level.

To establish and enforce a system of supervision that provides reasonable assurance that employees will act in compliance with applicable laws and the firm’s policies.

To implement strict penalties for analysts who fail to document their trades appropriately.

Hint

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