C4-L3-P16

Summary

While laws set the minimum standard by which producers are expected to behave, a person’s personal values or ethics provide a guidance system to help him or her choose the right answer or alternative to ethical dilemmas when several choices are available.

Historically, certain codes of ethics developed as a covenant among peers. However, modern codes of ethics have been based as well on considerations of the public interest, especially with regard to trade and commercial relationships. Codes of ethics identify and encourage desirable activities by formally establishing a high standard against which each individual may measure his or her performance.

Most professions have written codes of ethics that pledge the members of the profession to certain standards of conduct. For example, in addition to having a broad under-standing of accounting and tax laws, Certified Public Accountants (CPAs) must pass a series of rigorous examinations and are expected to adhere to a code of ethics.

Many other professional codes of conduct, such as the American College of CLU & ChFC, National Association of Insurance and Financial Advisors, National Association of Fraternal Insurance Counselors and the Certified Financial Planner Board of Standards, Inc., address the issue of ethics by establishing strict codes of ethics. These professional ethics are designed to guide, advise and regulate behavior on the job.

However formal the process is to establish the rules for ethical conduct, the rules still do not go beyond common sense and natural integrity. These attributes, plus knowledge and calculated awareness, can help the ethical producer steer clear of many temptations.