Question of ethics and conflict of interest

The current without knowing! Business leaders, receiving stock frames, lawyers, bankers: more and more professionals are condemned to live in this paradox. At any time, they can be sued for their stock portfolio management. Their trade are indeed exposed to hold potentially privileged information. To avoid this trap, the Brussels Bank De Groof has developed a secure management technique. For French leaders, it has been validated legally by the Parisian firm Bredin Prat. Explanations.

1. Why are certain professions more exposed

To be paid in shares has not only advantages. A leader is also a father. The day where he must help his children to settle in life, there may be short of cash. In theory, it need only to assign shares of the company that employs him. Except that the time to do so is never neutral. Suppose that, a few days later, an event affects the course of the title, suspicion will be immediately activated: the MFA could argue that arbitration was not motivated by a family account but by possession of privileged information. "It is the problem of the concept of the insider," said Houman Pakneehan, Director General of the Bank De Groof in Brussels. "Can you imagine a leader who is not informed." Non. Any good manager is therefore an insider.

But from when it occur in circumstances of tort The answer is delicate. The framework which gave a packet of shares to pay for his son studies in the United States may be worried if the course then collapses for an unexpected reason. Conversely, a collaborator informed before the market good news will never concern to have won a great potential value knowingly retaining his titles whose course takes off. Yet, it was not a perfect intellectual honesty. Therefore, must address these threats, to refrain from owning shares in his company No! "The problem prevents Houman Pakneehan, is not to hold, but to avoid being in a situation of involuntarily commit a tort.".

This pitfall is also well known lawyers, especially those who work in large international groups to audit. When they convert their fees financial investment, they are not the right to purchase securities of corporate customers of their employer. Question of ethics and conflict of interest. But how do we know that a subsidiary of listed company has not passed to the other end of the world, a contract with a subdivision of the Office The bankers, in essence, they are in the confidence of most of the files.

2. The means to protect themselves

As good faith may be impossible to prove, the solution proposed by the Bank De Groof and cabinet Bredin Prat is to evacuate to at the outset the issue of the possible detention of strategic information. They must be dissociated from the management of the portfolio. To this end, a heritage review is developed early in the year. Bank lists with the leader list predictable family events and funding needs that they will cause. A schedule of assignments of securities is then attached to specific dates. Most importantly, these instructions are recorded with a notary. They will be implemented. If a news hitting the course of the title, even though an order of sale had been triggered, the offending officer may establish that the two events were separated.

3. The issue in the future

At the beginning of the year, the CEO of a group of insurance of the CAC 40 is develop a program of management delegated its securities business. But the threat of insider is not an exclusively for senior executives. If pay equity policy continues to develop, the employees will be more likely to be exposed to the risk. Human resources directors concern indeed. In the United States, among the accompaniments of the salary, the legal protection and heritage is attention by senior management. According to a study performed in 2008 by Clark Consulting firm, it was claimed as a priority by 64 of surveyed executives. They were only 46 to request a service car and 61 additional life insurance.