Ethics Question (additional compensation, outside job)

Ok lets start with the contradictions early. In Schweser on page 54 (example 9) of book 1 it gives an example where an employee wants to be a paid town mayor w/o declaring it to his employer. Guidance is that this is ok, since it is not reasonably seen to interfere. Then on page 116 (question 6) asks if a portfolio manager can sell luxury automobiles and real estate on the side, and guidance says that this is NOT ok. I realize the 2nd example applies to the asset manager code and the 1st is an example from the the Code of Ethics/SOPC, but they are exactly the same no? Frustrated early…

Really I’d have said, declare both. But there are some nuances. The first one says “mayor” and the caveat is that it shouldn’t interfere with his current job. If he was a supermarket cashier, or teaching a cooking class, that’s pretty far removed from the investment profession. There’s no conflict. (I’m aware there could be a conflict as a mayor but it’s unlikely he would advise on city deals, probably he only rubberstamps what’s sent by a committee). But the second question said “several businesses, including…”, it didn’t give all the side businesses only 2 of them. If he had a lot of side jobs, it would interfere with his work.

Haha I love it. This must be what it’s like to be a lawyer. Good catch Ilkandi, I like your explanation. I didn’t really pay much attention to that subtle phrase, but at least it makes me feel better. Wouldn’t you agree though that just the luxury auto sales and real estate sales would be akin to the mayorial job, and thereby ok?

Yeah that would make the question more difficult to answer. My opinion is that one job like real estate sales would be OK, and it’s hard to draw a line after that as to how many is too many.

I thought the mayor part was only ok if it didnt interfere with his work schedule, time wise. Havent read the luxury car q yet.

Let the Schweser mistakes begin…trust me there will be loads of them! PS sbmfj is correct unrelated work can be accepted without notification as long as it doesn’t interfere with your delivery of duties to your employer (ex. even if you’re tired from working late this would then have to be disclosed since it will affect your “day” job)

Are you sure the mayor position was paid? For some reason I feel like it was an unpaid position. I may be confusing 2 of the examples.

Doesn’t matter if its paid or unpaid if takes up a substantial portion of his time or takes away from his ability to work for the full benefit of his initial employer it must be disclosed.