Portfolio Manager Misconduct Scenario

Very Easy Cfa Institute Code And Standards Professionalism - Misconduct

As a CFA charterholder, you are required to adhere to the CFA Institute Code of Ethics and Standards of Professional Conduct. These standards aim to ensure that members and candidates act ethically and professionally at all times. However, not all behaviors align with these expectations.

Consider the following scenario: A portfolio manager is aware that one of their employees is consistently late in reporting asset valuations, which is causing inaccuracies in client reports. Instead of addressing the issue directly with the employee, the portfolio manager opts to ignore the matter. This behavior may lead to consequences for clients relying on accurate information. In this context, which statement best describes the portfolio manager's actions?

The portfolio manager is acting appropriately by maintaining a peaceful work environment.

The portfolio manager is committing misconduct by failing to address a known issue that affects client reporting.

The portfolio manager is demonstrating leadership by not interfering with employee autonomy.

Hint

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