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Is it unethical, or a conflict of interest, to hold shares in other companies in my industry?
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I work for Company A and hold shares in Companies B and C who are competitors of A, or work in the same industry "niche" (e.g. A, B and C are all banks and I work in credit card processing for A).
Is that a potentially unethical action or a conflict of interest (assuming I just invest in the shares because I think B and C will give a good return to shareholders, and I won't directly take any action at A that would impact B or C other than carrying out my normal duties in the interests of A).
If I already owned stock in B or C before starting work at A, could I be asked to "exit" that position in the stock market?
There is no specific company policy about this; I'm asking about a more generic "Company A". Edited to add: I'm a standard low level employee, not in any kind of privileged position.
ethics
asked May 13 '16 at 17:34
user47059
15729
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up vote
2
down vote
favorite
I work for Company A and hold shares in Companies B and C who are competitors of A, or work in the same industry "niche" (e.g. A, B and C are all banks and I work in credit card processing for A).
Is that a potentially unethical action or a conflict of interest (assuming I just invest in the shares because I think B and C will give a good return to shareholders, and I won't directly take any action at A that would impact B or C other than carrying out my normal duties in the interests of A).
If I already owned stock in B or C before starting work at A, could I be asked to "exit" that position in the stock market?
There is no specific company policy about this; I'm asking about a more generic "Company A". Edited to add: I'm a standard low level employee, not in any kind of privileged position.
ethics
asked May 13 '16 at 17:34
user47059
15729
3
It's not just CEOs - it very much depends on thr nature of your job. For example, I had a fairly low level position in the Internal Audit group of a large investment bank. As a result there were a large number of policies on what shares I could hold and when I could buy. If you are in a financial institution their Complaince Group will happily explain what you can and cannot do.
– Laconic Droid
May 13 '16 at 19:26
2
In fact, it's often recommended that you reduce any holdings you have in your own company, to improve diversification. If your company were to have trouble, you could lose both your job and the value of the stock.
– mcknz
May 13 '16 at 19:39
In some cases, it also matters if you purchased the stock on your own or if they are a part of a managed fund.
– Thomas Owens
May 14 '16 at 14:44
For diversification you should probably invest in different sectors. Something that impacts the sector you are working in would hit both your job and your investments.
– Larry Smithmier
May 17 '16 at 17:23
suggest improvements |Â
up vote
2
down vote
favorite
up vote
2
down vote
favorite
I work for Company A and hold shares in Companies B and C who are competitors of A, or work in the same industry "niche" (e.g. A, B and C are all banks and I work in credit card processing for A).
Is that a potentially unethical action or a conflict of interest (assuming I just invest in the shares because I think B and C will give a good return to shareholders, and I won't directly take any action at A that would impact B or C other than carrying out my normal duties in the interests of A).
If I already owned stock in B or C before starting work at A, could I be asked to "exit" that position in the stock market?
There is no specific company policy about this; I'm asking about a more generic "Company A". Edited to add: I'm a standard low level employee, not in any kind of privileged position.
ethics
asked May 13 '16 at 17:34
user47059
15729
I work for Company A and hold shares in Companies B and C who are competitors of A, or work in the same industry "niche" (e.g. A, B and C are all banks and I work in credit card processing for A).
Is that a potentially unethical action or a conflict of interest (assuming I just invest in the shares because I think B and C will give a good return to shareholders, and I won't directly take any action at A that would impact B or C other than carrying out my normal duties in the interests of A).
If I already owned stock in B or C before starting work at A, could I be asked to "exit" that position in the stock market?
There is no specific company policy about this; I'm asking about a more generic "Company A". Edited to add: I'm a standard low level employee, not in any kind of privileged position.
ethics
asked May 13 '16 at 17:34
user47059
15729
edited May 13 '16 at 17:44
asked May 13 '16 at 17:34
user47059
15729
asked May 13 '16 at 17:34
user47059
15729
asked May 13 '16 at 17:34
user47059
15729
15729
3
It's not just CEOs - it very much depends on thr nature of your job. For example, I had a fairly low level position in the Internal Audit group of a large investment bank. As a result there were a large number of policies on what shares I could hold and when I could buy. If you are in a financial institution their Complaince Group will happily explain what you can and cannot do.
– Laconic Droid
May 13 '16 at 19:26
2
In fact, it's often recommended that you reduce any holdings you have in your own company, to improve diversification. If your company were to have trouble, you could lose both your job and the value of the stock.
– mcknz
May 13 '16 at 19:39
In some cases, it also matters if you purchased the stock on your own or if they are a part of a managed fund.
– Thomas Owens
May 14 '16 at 14:44
For diversification you should probably invest in different sectors. Something that impacts the sector you are working in would hit both your job and your investments.
– Larry Smithmier
May 17 '16 at 17:23
suggest improvements |Â
3
It's not just CEOs - it very much depends on thr nature of your job. For example, I had a fairly low level position in the Internal Audit group of a large investment bank. As a result there were a large number of policies on what shares I could hold and when I could buy. If you are in a financial institution their Complaince Group will happily explain what you can and cannot do.
– Laconic Droid
May 13 '16 at 19:26
2
In fact, it's often recommended that you reduce any holdings you have in your own company, to improve diversification. If your company were to have trouble, you could lose both your job and the value of the stock.
– mcknz
May 13 '16 at 19:39
In some cases, it also matters if you purchased the stock on your own or if they are a part of a managed fund.
– Thomas Owens
May 14 '16 at 14:44
For diversification you should probably invest in different sectors. Something that impacts the sector you are working in would hit both your job and your investments.
– Larry Smithmier
May 17 '16 at 17:23
3
3
It's not just CEOs - it very much depends on thr nature of your job. For example, I had a fairly low level position in the Internal Audit group of a large investment bank. As a result there were a large number of policies on what shares I could hold and when I could buy. If you are in a financial institution their Complaince Group will happily explain what you can and cannot do.
– Laconic Droid
May 13 '16 at 19:26
It's not just CEOs - it very much depends on thr nature of your job. For example, I had a fairly low level position in the Internal Audit group of a large investment bank. As a result there were a large number of policies on what shares I could hold and when I could buy. If you are in a financial institution their Complaince Group will happily explain what you can and cannot do.
– Laconic Droid
May 13 '16 at 19:26
2
2
In fact, it's often recommended that you reduce any holdings you have in your own company, to improve diversification. If your company were to have trouble, you could lose both your job and the value of the stock.
– mcknz
May 13 '16 at 19:39
In fact, it's often recommended that you reduce any holdings you have in your own company, to improve diversification. If your company were to have trouble, you could lose both your job and the value of the stock.
– mcknz
May 13 '16 at 19:39
In some cases, it also matters if you purchased the stock on your own or if they are a part of a managed fund.
– Thomas Owens
May 14 '16 at 14:44
In some cases, it also matters if you purchased the stock on your own or if they are a part of a managed fund.
– Thomas Owens
May 14 '16 at 14:44
For diversification you should probably invest in different sectors. Something that impacts the sector you are working in would hit both your job and your investments.
– Larry Smithmier
May 17 '16 at 17:23
For diversification you should probably invest in different sectors. Something that impacts the sector you are working in would hit both your job and your investments.
– Larry Smithmier
May 17 '16 at 17:23
suggest improvements |Â
4 Answers
4
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up vote
6
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No. It's perfectly fine to invest in competitors.
It would only be in exceptionally unusual circumstances that it would be an issue. If you bought, say, 5% of the shares of B, that would likely create an issue. If you used insider knowledge of A to buy or sell shares in B or C, that could be an issue. Undoubtedly, you can come up with a few other corner cases but those would be highly dependent on localized circumstances.
I've never heard of a company that asked (normal) new hires about their existing positions or that would ask someone to sell stock before their start date. Unless your country has a particular law that prevents that, I suppose a company could ask you to exit the position as a condition of employment. I certainly wouldn't worry that you'll actually come across such an offer until you're applying for CEO positions.
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
1
There is usually a black out period for large companies where employees are forbidden to sell their stock positions. Usually it is the time between when the company starts putting together the reports, until the reports are released to the public. It is probably safest to avoid selling competitor stock during this period as well just to avoid insider trading questions.
– IDrinkandIKnowThings
May 13 '16 at 18:39
@Chad depends on the country, but this blackout period only applies to the top management (that has access to privileged information). But ths is not a place for legal advice, so YMMV.
– Mindwin
May 13 '16 at 20:28
1
No it applies to anyone working at the company regardless of how much you have invested. They generally last no more than a few weeks. The law is that only people that have insider knowledge are forbidden but most companies just do a blanket because once the SEC sticks their nose into a business they dont like to come up empty even if the original target is not in violation. It can be very expensive for a company to endure an investigation.
– IDrinkandIKnowThings
May 13 '16 at 20:55
@Mindwin I can confirm Chad's point: in my experience the blackout period applies to all employees, and that's for a European company as well.
– Lilienthal♦
May 13 '16 at 22:44
What if a member of management fires an employee because they are performing well, for the simple reason they have heavily invested in competitors.
– Peter David Carter
May 14 '16 at 11:28
 |Â
show 2 more comments
up vote
3
down vote
The issue would depend on the size of the investment, the nature of the investment, and your role in your employers organization.
Regarding the size of the investment. If your investment is so large that they would have to list you on their government require documents, that would be a problem for your current employer.
The nature of the investment is also important. I own shares of mutual funds. These funds invest in dozens or hundreds of companies. Therefore some of my money is invested in competitors. I am sure my employer is OK with this because the fund is available through the 401K.
The third part to be considered is your role in your current company. Are you in a position to base purchasing decisions on the potential to help your outside investments. This wouldn't just apply to competitors, it would also apply to other conflicts of interest.
If they asked you to provide a list of companies you have significant investments in to identify potential sources of conflict you should comply, otherwise you may risk your position if they later discover it. In my experience if they have an issue they will usually also have suggested ways to mitigate it.
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
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In every company I have worked for in the last 18 years, I have had to declare any investments in competitors and clients, as well as any personal or familial relationships.
I have worked mostly in the Financial Services industry, so this does add to the governance pressure, but these roles were not all senior roles, so seniority isn't the critical factor.
Financial regulators usually do count these as a potential conflict of interest - but if you aren't in that sort of heavily regulated environment, it certainly isn't unethical. It generally isn't unethical even in financial services, but the regulator wants to avoid the possibility of unethical or criminal behaviour as best they can.
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
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In my opinion ethics mean nothing, they only get in the way of making money, the only thing you should be concerned about is first and foremost if you are legally and contractually allowed to hold shares and/or shorts in competitors and secondly if it will be profitable.
You did not specify your industry but in Financials the compliance teams are quite strict in what you can and can't do. But what is equally if not more important is ensuring that you do not act on insider, privileged or otherwise classified information about the corp in question. Regulator is the UK take a very very dim view on this and will come down on you very, very hard. As for the US, well, given the last few rulings on insider trading it unclear how you would fair, but as a hard and fast rule insider trading is illegal and can/will gen you banned from FS.
answered May 15 '16 at 17:23
user
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4 Answers
4
active
oldest
votes
4 Answers
4
active
oldest
votes
active
oldest
votes
active
oldest
votes
up vote
6
down vote
No. It's perfectly fine to invest in competitors.
It would only be in exceptionally unusual circumstances that it would be an issue. If you bought, say, 5% of the shares of B, that would likely create an issue. If you used insider knowledge of A to buy or sell shares in B or C, that could be an issue. Undoubtedly, you can come up with a few other corner cases but those would be highly dependent on localized circumstances.
I've never heard of a company that asked (normal) new hires about their existing positions or that would ask someone to sell stock before their start date. Unless your country has a particular law that prevents that, I suppose a company could ask you to exit the position as a condition of employment. I certainly wouldn't worry that you'll actually come across such an offer until you're applying for CEO positions.
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
1
There is usually a black out period for large companies where employees are forbidden to sell their stock positions. Usually it is the time between when the company starts putting together the reports, until the reports are released to the public. It is probably safest to avoid selling competitor stock during this period as well just to avoid insider trading questions.
– IDrinkandIKnowThings
May 13 '16 at 18:39
@Chad depends on the country, but this blackout period only applies to the top management (that has access to privileged information). But ths is not a place for legal advice, so YMMV.
– Mindwin
May 13 '16 at 20:28
1
No it applies to anyone working at the company regardless of how much you have invested. They generally last no more than a few weeks. The law is that only people that have insider knowledge are forbidden but most companies just do a blanket because once the SEC sticks their nose into a business they dont like to come up empty even if the original target is not in violation. It can be very expensive for a company to endure an investigation.
– IDrinkandIKnowThings
May 13 '16 at 20:55
@Mindwin I can confirm Chad's point: in my experience the blackout period applies to all employees, and that's for a European company as well.
– Lilienthal♦
May 13 '16 at 22:44
What if a member of management fires an employee because they are performing well, for the simple reason they have heavily invested in competitors.
– Peter David Carter
May 14 '16 at 11:28
 |Â
show 2 more comments
up vote
6
down vote
No. It's perfectly fine to invest in competitors.
It would only be in exceptionally unusual circumstances that it would be an issue. If you bought, say, 5% of the shares of B, that would likely create an issue. If you used insider knowledge of A to buy or sell shares in B or C, that could be an issue. Undoubtedly, you can come up with a few other corner cases but those would be highly dependent on localized circumstances.
I've never heard of a company that asked (normal) new hires about their existing positions or that would ask someone to sell stock before their start date. Unless your country has a particular law that prevents that, I suppose a company could ask you to exit the position as a condition of employment. I certainly wouldn't worry that you'll actually come across such an offer until you're applying for CEO positions.
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
1
There is usually a black out period for large companies where employees are forbidden to sell their stock positions. Usually it is the time between when the company starts putting together the reports, until the reports are released to the public. It is probably safest to avoid selling competitor stock during this period as well just to avoid insider trading questions.
– IDrinkandIKnowThings
May 13 '16 at 18:39
@Chad depends on the country, but this blackout period only applies to the top management (that has access to privileged information). But ths is not a place for legal advice, so YMMV.
– Mindwin
May 13 '16 at 20:28
1
No it applies to anyone working at the company regardless of how much you have invested. They generally last no more than a few weeks. The law is that only people that have insider knowledge are forbidden but most companies just do a blanket because once the SEC sticks their nose into a business they dont like to come up empty even if the original target is not in violation. It can be very expensive for a company to endure an investigation.
– IDrinkandIKnowThings
May 13 '16 at 20:55
@Mindwin I can confirm Chad's point: in my experience the blackout period applies to all employees, and that's for a European company as well.
– Lilienthal♦
May 13 '16 at 22:44
What if a member of management fires an employee because they are performing well, for the simple reason they have heavily invested in competitors.
– Peter David Carter
May 14 '16 at 11:28
 |Â
show 2 more comments
up vote
6
down vote
up vote
6
down vote
No. It's perfectly fine to invest in competitors.
It would only be in exceptionally unusual circumstances that it would be an issue. If you bought, say, 5% of the shares of B, that would likely create an issue. If you used insider knowledge of A to buy or sell shares in B or C, that could be an issue. Undoubtedly, you can come up with a few other corner cases but those would be highly dependent on localized circumstances.
I've never heard of a company that asked (normal) new hires about their existing positions or that would ask someone to sell stock before their start date. Unless your country has a particular law that prevents that, I suppose a company could ask you to exit the position as a condition of employment. I certainly wouldn't worry that you'll actually come across such an offer until you're applying for CEO positions.
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
No. It's perfectly fine to invest in competitors.
It would only be in exceptionally unusual circumstances that it would be an issue. If you bought, say, 5% of the shares of B, that would likely create an issue. If you used insider knowledge of A to buy or sell shares in B or C, that could be an issue. Undoubtedly, you can come up with a few other corner cases but those would be highly dependent on localized circumstances.
I've never heard of a company that asked (normal) new hires about their existing positions or that would ask someone to sell stock before their start date. Unless your country has a particular law that prevents that, I suppose a company could ask you to exit the position as a condition of employment. I certainly wouldn't worry that you'll actually come across such an offer until you're applying for CEO positions.
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
answered May 13 '16 at 18:02
Justin Cave
34.8k9112136
34.8k9112136
1
There is usually a black out period for large companies where employees are forbidden to sell their stock positions. Usually it is the time between when the company starts putting together the reports, until the reports are released to the public. It is probably safest to avoid selling competitor stock during this period as well just to avoid insider trading questions.
– IDrinkandIKnowThings
May 13 '16 at 18:39
@Chad depends on the country, but this blackout period only applies to the top management (that has access to privileged information). But ths is not a place for legal advice, so YMMV.
– Mindwin
May 13 '16 at 20:28
1
No it applies to anyone working at the company regardless of how much you have invested. They generally last no more than a few weeks. The law is that only people that have insider knowledge are forbidden but most companies just do a blanket because once the SEC sticks their nose into a business they dont like to come up empty even if the original target is not in violation. It can be very expensive for a company to endure an investigation.
– IDrinkandIKnowThings
May 13 '16 at 20:55
@Mindwin I can confirm Chad's point: in my experience the blackout period applies to all employees, and that's for a European company as well.
– Lilienthal♦
May 13 '16 at 22:44
What if a member of management fires an employee because they are performing well, for the simple reason they have heavily invested in competitors.
– Peter David Carter
May 14 '16 at 11:28
 |Â
show 2 more comments
1
There is usually a black out period for large companies where employees are forbidden to sell their stock positions. Usually it is the time between when the company starts putting together the reports, until the reports are released to the public. It is probably safest to avoid selling competitor stock during this period as well just to avoid insider trading questions.
– IDrinkandIKnowThings
May 13 '16 at 18:39
@Chad depends on the country, but this blackout period only applies to the top management (that has access to privileged information). But ths is not a place for legal advice, so YMMV.
– Mindwin
May 13 '16 at 20:28
1
No it applies to anyone working at the company regardless of how much you have invested. They generally last no more than a few weeks. The law is that only people that have insider knowledge are forbidden but most companies just do a blanket because once the SEC sticks their nose into a business they dont like to come up empty even if the original target is not in violation. It can be very expensive for a company to endure an investigation.
– IDrinkandIKnowThings
May 13 '16 at 20:55
@Mindwin I can confirm Chad's point: in my experience the blackout period applies to all employees, and that's for a European company as well.
– Lilienthal♦
May 13 '16 at 22:44
What if a member of management fires an employee because they are performing well, for the simple reason they have heavily invested in competitors.
– Peter David Carter
May 14 '16 at 11:28
1
1
There is usually a black out period for large companies where employees are forbidden to sell their stock positions. Usually it is the time between when the company starts putting together the reports, until the reports are released to the public. It is probably safest to avoid selling competitor stock during this period as well just to avoid insider trading questions.
– IDrinkandIKnowThings
May 13 '16 at 18:39
There is usually a black out period for large companies where employees are forbidden to sell their stock positions. Usually it is the time between when the company starts putting together the reports, until the reports are released to the public. It is probably safest to avoid selling competitor stock during this period as well just to avoid insider trading questions.
– IDrinkandIKnowThings
May 13 '16 at 18:39
@Chad depends on the country, but this blackout period only applies to the top management (that has access to privileged information). But ths is not a place for legal advice, so YMMV.
– Mindwin
May 13 '16 at 20:28
@Chad depends on the country, but this blackout period only applies to the top management (that has access to privileged information). But ths is not a place for legal advice, so YMMV.
– Mindwin
May 13 '16 at 20:28
1
1
No it applies to anyone working at the company regardless of how much you have invested. They generally last no more than a few weeks. The law is that only people that have insider knowledge are forbidden but most companies just do a blanket because once the SEC sticks their nose into a business they dont like to come up empty even if the original target is not in violation. It can be very expensive for a company to endure an investigation.
– IDrinkandIKnowThings
May 13 '16 at 20:55
No it applies to anyone working at the company regardless of how much you have invested. They generally last no more than a few weeks. The law is that only people that have insider knowledge are forbidden but most companies just do a blanket because once the SEC sticks their nose into a business they dont like to come up empty even if the original target is not in violation. It can be very expensive for a company to endure an investigation.
– IDrinkandIKnowThings
May 13 '16 at 20:55
@Mindwin I can confirm Chad's point: in my experience the blackout period applies to all employees, and that's for a European company as well.
– Lilienthal♦
May 13 '16 at 22:44
@Mindwin I can confirm Chad's point: in my experience the blackout period applies to all employees, and that's for a European company as well.
– Lilienthal♦
May 13 '16 at 22:44
What if a member of management fires an employee because they are performing well, for the simple reason they have heavily invested in competitors.
– Peter David Carter
May 14 '16 at 11:28
What if a member of management fires an employee because they are performing well, for the simple reason they have heavily invested in competitors.
– Peter David Carter
May 14 '16 at 11:28
 |Â
show 2 more comments
up vote
3
down vote
The issue would depend on the size of the investment, the nature of the investment, and your role in your employers organization.
Regarding the size of the investment. If your investment is so large that they would have to list you on their government require documents, that would be a problem for your current employer.
The nature of the investment is also important. I own shares of mutual funds. These funds invest in dozens or hundreds of companies. Therefore some of my money is invested in competitors. I am sure my employer is OK with this because the fund is available through the 401K.
The third part to be considered is your role in your current company. Are you in a position to base purchasing decisions on the potential to help your outside investments. This wouldn't just apply to competitors, it would also apply to other conflicts of interest.
If they asked you to provide a list of companies you have significant investments in to identify potential sources of conflict you should comply, otherwise you may risk your position if they later discover it. In my experience if they have an issue they will usually also have suggested ways to mitigate it.
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
suggest improvements |Â
up vote
3
down vote
The issue would depend on the size of the investment, the nature of the investment, and your role in your employers organization.
Regarding the size of the investment. If your investment is so large that they would have to list you on their government require documents, that would be a problem for your current employer.
The nature of the investment is also important. I own shares of mutual funds. These funds invest in dozens or hundreds of companies. Therefore some of my money is invested in competitors. I am sure my employer is OK with this because the fund is available through the 401K.
The third part to be considered is your role in your current company. Are you in a position to base purchasing decisions on the potential to help your outside investments. This wouldn't just apply to competitors, it would also apply to other conflicts of interest.
If they asked you to provide a list of companies you have significant investments in to identify potential sources of conflict you should comply, otherwise you may risk your position if they later discover it. In my experience if they have an issue they will usually also have suggested ways to mitigate it.
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
suggest improvements |Â
up vote
3
down vote
up vote
3
down vote
The issue would depend on the size of the investment, the nature of the investment, and your role in your employers organization.
Regarding the size of the investment. If your investment is so large that they would have to list you on their government require documents, that would be a problem for your current employer.
The nature of the investment is also important. I own shares of mutual funds. These funds invest in dozens or hundreds of companies. Therefore some of my money is invested in competitors. I am sure my employer is OK with this because the fund is available through the 401K.
The third part to be considered is your role in your current company. Are you in a position to base purchasing decisions on the potential to help your outside investments. This wouldn't just apply to competitors, it would also apply to other conflicts of interest.
If they asked you to provide a list of companies you have significant investments in to identify potential sources of conflict you should comply, otherwise you may risk your position if they later discover it. In my experience if they have an issue they will usually also have suggested ways to mitigate it.
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
The issue would depend on the size of the investment, the nature of the investment, and your role in your employers organization.
Regarding the size of the investment. If your investment is so large that they would have to list you on their government require documents, that would be a problem for your current employer.
The nature of the investment is also important. I own shares of mutual funds. These funds invest in dozens or hundreds of companies. Therefore some of my money is invested in competitors. I am sure my employer is OK with this because the fund is available through the 401K.
The third part to be considered is your role in your current company. Are you in a position to base purchasing decisions on the potential to help your outside investments. This wouldn't just apply to competitors, it would also apply to other conflicts of interest.
If they asked you to provide a list of companies you have significant investments in to identify potential sources of conflict you should comply, otherwise you may risk your position if they later discover it. In my experience if they have an issue they will usually also have suggested ways to mitigate it.
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
answered May 14 '16 at 12:41
mhoran_psprep
40k461143
40k461143
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In every company I have worked for in the last 18 years, I have had to declare any investments in competitors and clients, as well as any personal or familial relationships.
I have worked mostly in the Financial Services industry, so this does add to the governance pressure, but these roles were not all senior roles, so seniority isn't the critical factor.
Financial regulators usually do count these as a potential conflict of interest - but if you aren't in that sort of heavily regulated environment, it certainly isn't unethical. It generally isn't unethical even in financial services, but the regulator wants to avoid the possibility of unethical or criminal behaviour as best they can.
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
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up vote
1
down vote
In every company I have worked for in the last 18 years, I have had to declare any investments in competitors and clients, as well as any personal or familial relationships.
I have worked mostly in the Financial Services industry, so this does add to the governance pressure, but these roles were not all senior roles, so seniority isn't the critical factor.
Financial regulators usually do count these as a potential conflict of interest - but if you aren't in that sort of heavily regulated environment, it certainly isn't unethical. It generally isn't unethical even in financial services, but the regulator wants to avoid the possibility of unethical or criminal behaviour as best they can.
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
suggest improvements |Â
up vote
1
down vote
up vote
1
down vote
In every company I have worked for in the last 18 years, I have had to declare any investments in competitors and clients, as well as any personal or familial relationships.
I have worked mostly in the Financial Services industry, so this does add to the governance pressure, but these roles were not all senior roles, so seniority isn't the critical factor.
Financial regulators usually do count these as a potential conflict of interest - but if you aren't in that sort of heavily regulated environment, it certainly isn't unethical. It generally isn't unethical even in financial services, but the regulator wants to avoid the possibility of unethical or criminal behaviour as best they can.
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
In every company I have worked for in the last 18 years, I have had to declare any investments in competitors and clients, as well as any personal or familial relationships.
I have worked mostly in the Financial Services industry, so this does add to the governance pressure, but these roles were not all senior roles, so seniority isn't the critical factor.
Financial regulators usually do count these as a potential conflict of interest - but if you aren't in that sort of heavily regulated environment, it certainly isn't unethical. It generally isn't unethical even in financial services, but the regulator wants to avoid the possibility of unethical or criminal behaviour as best they can.
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
edited May 15 '16 at 11:29
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
answered May 14 '16 at 14:29
Rory Alsop
5,55612340
5,55612340
suggest improvements |Â
suggest improvements |Â
up vote
-1
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In my opinion ethics mean nothing, they only get in the way of making money, the only thing you should be concerned about is first and foremost if you are legally and contractually allowed to hold shares and/or shorts in competitors and secondly if it will be profitable.
You did not specify your industry but in Financials the compliance teams are quite strict in what you can and can't do. But what is equally if not more important is ensuring that you do not act on insider, privileged or otherwise classified information about the corp in question. Regulator is the UK take a very very dim view on this and will come down on you very, very hard. As for the US, well, given the last few rulings on insider trading it unclear how you would fair, but as a hard and fast rule insider trading is illegal and can/will gen you banned from FS.
answered May 15 '16 at 17:23
user
99
suggest improvements |Â
up vote
-1
down vote
In my opinion ethics mean nothing, they only get in the way of making money, the only thing you should be concerned about is first and foremost if you are legally and contractually allowed to hold shares and/or shorts in competitors and secondly if it will be profitable.
You did not specify your industry but in Financials the compliance teams are quite strict in what you can and can't do. But what is equally if not more important is ensuring that you do not act on insider, privileged or otherwise classified information about the corp in question. Regulator is the UK take a very very dim view on this and will come down on you very, very hard. As for the US, well, given the last few rulings on insider trading it unclear how you would fair, but as a hard and fast rule insider trading is illegal and can/will gen you banned from FS.
answered May 15 '16 at 17:23
user
99
suggest improvements |Â
up vote
-1
down vote
up vote
-1
down vote
In my opinion ethics mean nothing, they only get in the way of making money, the only thing you should be concerned about is first and foremost if you are legally and contractually allowed to hold shares and/or shorts in competitors and secondly if it will be profitable.
You did not specify your industry but in Financials the compliance teams are quite strict in what you can and can't do. But what is equally if not more important is ensuring that you do not act on insider, privileged or otherwise classified information about the corp in question. Regulator is the UK take a very very dim view on this and will come down on you very, very hard. As for the US, well, given the last few rulings on insider trading it unclear how you would fair, but as a hard and fast rule insider trading is illegal and can/will gen you banned from FS.
answered May 15 '16 at 17:23
user
99
In my opinion ethics mean nothing, they only get in the way of making money, the only thing you should be concerned about is first and foremost if you are legally and contractually allowed to hold shares and/or shorts in competitors and secondly if it will be profitable.
You did not specify your industry but in Financials the compliance teams are quite strict in what you can and can't do. But what is equally if not more important is ensuring that you do not act on insider, privileged or otherwise classified information about the corp in question. Regulator is the UK take a very very dim view on this and will come down on you very, very hard. As for the US, well, given the last few rulings on insider trading it unclear how you would fair, but as a hard and fast rule insider trading is illegal and can/will gen you banned from FS.
answered May 15 '16 at 17:23
user
99
answered May 15 '16 at 17:23
user
99
answered May 15 '16 at 17:23
user
99
answered May 15 '16 at 17:23
user
99
99
suggest improvements |Â
suggest improvements |Â
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3
It's not just CEOs - it very much depends on thr nature of your job. For example, I had a fairly low level position in the Internal Audit group of a large investment bank. As a result there were a large number of policies on what shares I could hold and when I could buy. If you are in a financial institution their Complaince Group will happily explain what you can and cannot do.
– Laconic Droid
May 13 '16 at 19:26
2
In fact, it's often recommended that you reduce any holdings you have in your own company, to improve diversification. If your company were to have trouble, you could lose both your job and the value of the stock.
– mcknz
May 13 '16 at 19:39
In some cases, it also matters if you purchased the stock on your own or if they are a part of a managed fund.
– Thomas Owens
May 14 '16 at 14:44
For diversification you should probably invest in different sectors. Something that impacts the sector you are working in would hit both your job and your investments.
– Larry Smithmier
May 17 '16 at 17:23