The Glenarm Company Case Report

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The Glenarm Company Case Report Executive Summary The Glenarm Company case study is based on Peter Sherman, CFA holder, and the ethical implications involved with his move from Pearl Investment Management to the Glenarm Company for a new position. This is Sherman’s last week working at Pearl for 5 years as a junior research analyst before he moves to his new employer Glenarm as a portfolio manager. The past history of the Glenarm Company regarding ethical problems has set the circumstances (which can be viewed as ethically dubious) to allow the opportunity for Sherman to switch firms. This switch has then also given Sherman the opportunity and…show more content…
As a result he has also violated Standard VI - Conflict of Interest (A): Disclosure of Conflicts, which states Sherman should have provided full disclosure on these matters that have created a conflict of interest. Sherman’s objectivity was compromised which resulted in him taking unethical actions and violating Standard IV - Duties to Employers (B) and most importantly Standard I - Professionalism (B): Independence and Objectivity. Clients are not the only thing Sherman is wrongfully taking from Pearl. Research on companies, marketing presentations, financial models and similar work he has worked on at Pearl is being taken to be used at Glenarm. “Research and models developed while employed by a firm are the property of the firm.”(CFA Institute, 2011, p. 40) as stated under Standard I - Professionalism . Unless Pearl had explicitly given Sherman a written consent to take his research with him to Glenarm, he is not allowed to take Pearl’s property as stated under Standard IV (A) - Duties to Employers. Recommendations for Correction and Prevention Not all unethical actions committed in this situation can be corrected, but policies could have been implemented by the firms to prevent them from happening. As a CFA holder, Sherman should have not solicited Pearl’s clients while he was employed at the firm. To correct this, he should first state the nature of the situation without bias to himself or either firm. He should

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