Code of Conduct
The GARP Code of Conduct ("Code") sets forth
principles of professional conduct for Global Association of Risk
Professionals ("GARP"), Financial Risk Management (FRM®) and Energy
Risk Professional (ERP®) certifications and other GARP
certification and diploma holders and candidates, GARP's Board of
Trustees, its Regional Directors, GARP Committee Members and GARP's
staff (hereinafter collectively referred to as "GARP Members") in
support of the advancement of the financial risk management
profession. These principles promote the highest levels of ethical
conduct and disclosure and provide direction and support for both
the individual practitioner and the risk management
The pursuit of high ethical standards goes
beyond following the letter of applicable rules and regulations and
behaving in accordance with the intentions of those laws and
regulations, it is about pursuing a universal ethical
All individuals, firms and associations have
an ethical character. Some of the biggest risks faced by firms
today do not involve legal or compliance violations but rest on
decisions involving ethical considerations and the application of
appropriate standards of conduct to business decision making.
There is no single prescriptive ethical
standard that can be globally applied. We can only expect that GARP
Members will continuously consider ethical issues and adjust their
conduct accordingly as they engage in their daily activities. This
document makes references to professional standards and generally
accepted risk management practices. Risk practitioners should
understand these as concepts that reflect an evolving shared body
of professional standards and practices. In considering the issues
this raises, ethical behavior must weigh the circumstances and the
culture of the applicable global community in which the
CODE OF CONDUCT
The Code is comprised of the following
Principles, Professional Standards and Rules of Conduct which GARP
Members agree to uphold and implement.
1.1 Professional Integrity and Ethical
Conduct. GARP Members shall act with honesty, integrity, and
competence to fulfill the risk professional's responsibilities and
to uphold the reputation of the risk management profession. GARP
Members must avoid disguised contrivances in assessments,
measurements and processes that are intended to provide business
advantage at the expense of honesty and truthfulness.
1.2 Conflicts of Interest. GARP
Members have a responsibility to promote the interests of all
relevant constituencies and will not knowingly perform risk
management services directly or indirectly involving an actual or
potential conflict of interest unless full disclosure has been
provided to all affected parties of any actual or apparent conflict
of interest. Where conflicts are unavoidable GARP Members commit to
their full disclosure and management.
1.3 Confidentiality. GARP Members
will take all reasonable precautionary measures to prevent
intentional and unintentional disclosure of confidential
GARP Members must endeavor, and encourage others, to operate at the
highest level of professional skill.
GARP Members should always continue to perfect their
GARP Members have a personal ethical responsibility and cannot
out-source or delegate that responsibility to others.
2.2 Best Practices.
GARP Members will promote and adhere to applicable "best practice
standards," and will ensure that risk management activities
performed under his/her direct supervision or management satisfies
these applicable standards.
GARP Members recognize that risk management does not exist in a
vacuum. GARP Members commit to considering the wider impact of
their assessments and actions on their colleagues and the wider
community and environment in which they work.
2.3 Communication and Disclosure.
GARP Members issuing any communications on behalf of their firm
will ensure that the communications are clear, appropriate to the
circumstances and their intended audience, and satisfy applicable
standards of conduct.
RULES OF CONDUCT
1. Professional Integrity and
1.1 Shall act professionally,
ethically and with integrity in all dealings with employers,
existing or potential clients, the public, and other practitioners
in the financial services industry.
1.2 Shall exercise reasonable
judgment in the provision of risk services while maintaining
independence of thought and direction. GARP Members must not offer,
solicit, or accept any gift, benefit, compensation, or
consideration that could be reasonably expected to compromise their
own or another's independence and objectivity.
1.3 Must take reasonable
precautions to ensure that the Member's services are not used for
improper, fraudulent or illegal purposes.
1.4 Shall not knowingly
misrepresent details relating to analysis, recommendations,
actions, or other professional activities.
1.5 Shall not engage in any
professional conduct involving dishonesty or deception or engage in
any act that reflects negatively on their integrity, character,
trustworthiness, or professional ability or on the risk management
1.6 Shall not engage in any conduct
or commit any act that compromises the integrity of GARP, the
(Financial Risk Manager) FRM designation or the integrity or
validity of the examinations leading to the award of the right to
use the FRM designation or any other credentials that may be
offered by GARP.
1.7 Shall endeavor to be mindful of
cultural differences regarding ethical behavior and customs, and to
avoid any actions that are, or may have the appearance of being
unethical according to local customs. If there appears to be a
conflict or overlap of standards, the GARP member should always
seek to apply the higher standard.
2. Conflict of
2.1 Shall act fairly in all
situations and must fully disclose any actual or potential conflict
to all affected parties.
2.2 Shall make full and fair
disclosure of all matters that could reasonably be expected to
impair their independence and objectivity or interfere with their
respective duties to their employer, clients, and prospective
3.1 Shall not make use of
confidential information for inappropriate purposes and unless
having received prior consent shall maintain the confidentiality of
their work, their employer or client.
3.2 Must not use confidential
information to benefit personally.
4.1 Shall comply with all
applicable laws, rules, and regulations (including this Code)
governing the GARP Members' professional activities and shall not
knowingly participate or assist in any violation of such laws,
rules, or regulations.
4.2 Shall have ethical
responsibilities and cannot out-source or delegate those
responsibilities to others.
4.3 Shall understand the needs and
complexity of their employer or client, and should provide
appropriate and suitable risk management services and advice.
4.4 Shall be diligent about not
overstating the accuracy or certainty of results or
4.5 Shall clearly disclose the
relevant limits of their specific knowledge and expertise
concerning risk assessment, industry practices and applicable laws
5. General Accepted
5.1 Shall execute all services with
diligence and perform all work in a manner that is independent from
interested parties. GARP Members should collect, analyze and
distribute risk information with the highest level of professional
5.2 Shall be familiar with current
generally accepted risk management practices and shall clearly
indicate any departure from their use.
5.3 Shall ensure that
communications include factual data and do not contain false
5.4 Shall make a distinction
between fact and opinion in the presentation of analysis and
Applicability and Enforcement
Every GARP Member should know and abide by
this Code. Local laws and regulations may also impose obligations
on GARP Members. Where local requirements conflict with the Code,
such requirements will have precedence.
Violation(s) of this Code by may result in,
among other things, the temporary suspension or permanent removal
of the GARP Member from GARP's Membership roles, and may also
include temporarily or permanently removing from the violator the
right to use or refer to having earned the FRM designation or any
other GARP granted designation, following a formal determination
that such a violation has occurred.