Ethical Performance Reporting in Asset Management

As an asset manager, firm XYZ has been utilizing a performance reporting method that accounts for risk-adjusted returns for its portfolio clients. Recently, they were approached by a potential new client, a large pension fund, which inquires about the firm’s past performance and how they ensure that reports meet ethical standards, particularly regarding the Asset Manager Code's section on Performance Reporting.

In your essay, discuss the key considerations that XYZ should focus on when preparing performance reports for their prospective client. Ensure you reference the principles of the Asset Manager Code, particularly regarding transparency, fair representation, and compliance with laws.