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Answer: The GARP member should always seek to apply the highest standard among the GARP Code of Conduct, local law, and country's law.
## Explanation When multiple standards such as the GARP Code of Conduct, local laws, and national laws appear to be in conflict or overlap, the correct approach is to apply the **highest standard** among all applicable requirements. This ensures: - **Comprehensive compliance**: By adhering to the most stringent requirement, the member ensures compliance with all applicable standards - **Risk minimization**: This approach minimizes legal and professional risks by operating within the strictest boundaries - **Ethical commitment**: Demonstrates a commitment to maintaining the highest ethical standards in professional conduct **Why other options are incorrect:** - **Choice A**: Focusing only on the GARP Code of Conduct ignores potentially stricter local or national laws - **Choice C**: Considering only GARP Code or local law neglects potentially stricter national laws - **Choice D**: Adhering only to country's law ignores stricter local laws or professional codes This principle is fundamental to risk management as it ensures professionals operate with the highest level of integrity and compliance across all regulatory frameworks.
Author: Tanishq Prabhu
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The GARP Code of Conduct, as well as the local and national laws, all have their own unique requirements. However, when these standards appear to be in conflict or overlap, the GARP member should always seek to apply the highest standard. This means that the member should adhere to the most stringent requirement among the GARP Code of Conduct, the local law, and the country's law. This approach ensures that the member is always operating within the bounds of the law and the professional code of conduct, thereby minimizing the risk of legal and professional repercussions. It also demonstrates the member's commitment to maintaining high ethical standards in her professional conduct, which is a key aspect of risk management.
A
While the GARP Code of Conduct is important, it may not always represent the highest standard when compared to local or national laws. Therefore, simply adhering to the GARP Code of Conduct without considering other regulations could lead to non-compliance with stricter standards.
B
The GARP member should always seek to apply the highest standard among the GARP Code of Conduct, local law, and country's law.
C
This option suggests that the member should adhere either to the GARP Code of Conduct or local law, depending on which one is higher. However, this choice neglects consideration for national laws which might have stricter stipulations than both local law and GARP code.
D
Adhering only to the country's law would ignore potentially stricter standards set by local laws or by professional codes such as the GARP Code of Conduct.