• Skip to main content
  • Skip to secondary menu
  • Skip to footer

Press Media Release

press release distribution

  • Submit a Press Release
  • Market Wire
  • Make a Contribution
  • About
    • Template for press/media release
    • How to structure your press release for maximum impact
    • Crafting effective headlines and leads to capture journalists’ attention
    • Understanding the dos and don’ts of writing press releases
    • Tips for writing clear, concise, and informative press releases
    • The importance of understanding your audience before writing a press release
    • Best practices for incorporating quotes and statistics in your press release
    • Writing effective boilerplates and about us sections for press releases
    • Identifying key media contacts and building relationships with journalists
    • Writing for different types of media, such as print, online, and social media
    • Measuring the success of your press release and tracking media coverage
  • Contact

Can ethics be taught? New research from MIT Sloan and Notre Dame offers first large sample evidence on how ethics training affects behavior and employment decisions in the financial sector

November 18, 2019 By admin Leave a Comment

Can ethics be taught? Evidence points towards yes, according to new research that offers the first large sample study on how rules and ethics training affects behavior and employment decisions in the financial sector.

The authors are Andrew G. Sutherland, Associate Professor of Accounting at the MIT Sloan School of Management; Zach Kowaleski, Assistant Professor of Accounting at the University of Notre Dame’s Mendoza College of Business; and Felix Vetter, a PhD candidate at the London School of Economics.

The researchers studied nearly 1.2 million investment advisers and financial representatives working at U.S. broker-dealers between 2007 and 2017, with a focus on the consequences of a 2010 change in the investment adviser qualification exam. That year, questions from the rules and ethics section were reallocated to the technical material section. The rules and ethics section covers allowable forms of compensation, disclosure requirements, and prohibitions of unethical business practices while the technical section covers such topics as capital market theory, investment vehicle characteristics, ratios, and financial reporting. Prior to the change, rules and ethics questions received an 80% weight, whereas after their weight was just 50%.

The authors’ analysis effectively compares individuals who took different versions of the exam but are otherwise similar in terms of their current employer, location, qualifications, and experience.

Their main finding is that those passing the older exam, with more rules and ethics coverage, were one-fourth less likely to commit misconduct. A similar pattern appears for egregious misconduct—incidents involving fraud, theft, or deception—indicating the exam alters individuals’ perception of acceptable conduct (i.e., ethics) and not just their awareness of specific rules.

In terms of individual characteristics, they found the behavior of the least experienced advisers is most sensitive to the extent of rules and ethics testing. These results are consistent with the exam playing a “priming” role, where early exposure to rules and ethics material prepares the individual to behave appropriately later. Those passing the exam without prior misconduct appear to respond most to the amount of rules and ethics material covered on their exam. Those already engaging in misconduct, or having spent several years working in the securities industry, respond least or not at all.

As for firm characteristics, the researchers found the exam’s coverage to be less pertinent to those advisers working at firms where misconduct is prevalent. Thus, the contagion of misconduct behavior appears to limit the effectiveness of training in preventing transgressions.

Further, those advisers passing the older exam were more likely to leave employers experiencing a firm-wide spike in misconduct and financial sanctions. Such departures, the researchers noted, are also an early warning sign of future misconduct and sanctions at the firm.

The exam is administered by the Financial Industry Regulatory Authority (FINRA) and designed by the North American Securities Administrators Association (NASAA).

“Advisers play an important role in helping households access financial markets, and represent one of the largest financial sector occupations in the United States. The exam appears to affect advisers’ perception of acceptable conduct, and not just their awareness of specific rules or selection into the qualification,” says Prof. Sutherland. “In this context, ethics training can affect an individual’s behavior by increasing the value of their reputation, as well as the psychological costs of committing misconduct.”

To access the research paper, Can Ethics be Taught? Evidence from Securities Exams and Investment Adviser Misconduct, please visit: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3457588

About the MIT Sloan School of Management

The MIT Sloan School of Management is where smart, independent leaders come together to solve problems, create new organizations, and improve the world. Learn more at mitsloan.mit.edu.

SOURCE: MIT Sloan School of Management
http://www.mitsloan.mit.edu

Filed Under: Press Release Tagged With: fintech

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Footer

Recent Posts

  • TravelMktg.com and Government Organizations Unite for Tourism Promotion
  • Press/Media Releases: The Secret Weapon to Viral Marketing
  • BrandsToShop.com Launches an Exciting Online Shopping Destination for Fashion Enthusiasts
  • S3H.com Unveils Cutting-Edge Software Products and Solutions at IBC 2023
  • Elevator pitch: Referently.com
  • Exploring the Boundless Horizons of Generative Media: A Gratitude Note to ZGM 2023 Organizers
  • Unlocking the Viral Potential: How a Media Release Can Supercharge Your Marketing
  • Leveraging Press Releases as a Powerful Marketing Tool
  • Introducing “Media Tycoon” – The Ultimate Strategy Game for Aspiring Media Moguls
  • Introducing ZGM.org: Pioneering the Future of Generative Media

Media Partners

  • VPNW.com
  • OPINT
  • Digital Market
Secrets of VPN Usage: A Global Perspective
Unveiling the Potential: A Comprehensive Analysis of the Future of AI-Powered VPNs
Navigating the Complex Landscape of VPN Vulnerabilities: A Cybersecurity Expert’s Perspective
How about a VPN startup that focuses on providing a decentralized and community-driven VPN service?
The Role of VPNs in Upholding Democracy
Operational Intelligence: Safeguarding Against Global Security Threats Through Proactive Preparedness
Securing Healthcare Supply Chains: Operational Intelligence in the Face of Geopolitical Disruptions
Navigating Trade Wars: Leveraging Economic Intelligence for Resilient Business Strategies
Navigating Geopolitics in the Era of Technological Evolution: Operational Intelligence as a Strategic Imperative
Climate Change and Geopolitical Shifts: Navigating Resource Scarcity, Migration, and Operational Resilience
Unveiling Calendarial.com: Your Premier Event Management Solution!
ZGM.org: Crafting the Digital Zeitgeist
Exploring the Future of Cities: ZGM to attend the Smart City Expo World Congress 2023
Design Brief: jQuery-Powered SQLite Database CMS
Business Plan for Newspaperdom.com

Media Partners

  • Media Instances
  • PXEF.com
  • Marketing Development
A Beachside Reflection
Urban Reverie: Navigating Life’s Chaos and Calm
The Great Gambit
5 Tips for Writing a Good Blog Post
The 5 Most Unusual Habits of Successful People
Celestial Conundrums: Exploring the Enigmatic Mysteries of the Universe
Navigating the Digital Wilderness: A Marketer’s Odyssey
Neon Reverie: Exploring the Digital Dreamscape
The Role of Optical Illusions in Effect Filters
The Fascinating Technology Behind Generative Animation
Technography as a Marketing Tool
Creating Unforgettable Moments: My Journey into Event Marketing
Crafting a Successful National Tourism Promotion Campaign
Navigating Customer Service: The Myth and Reality of 'The Customer is Always Right'
Introducing TechnologyConference.com: Your Gateway to the Future of Tech!

Copyright © 2022 PressMediaRelease.com

Sponsored by Exclusive Domains

We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept”, you consent to the use of ALL the cookies.
Do not sell my personal information.
Cookie SettingsAccept
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checkbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checkbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checkbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checkbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT