A Comprehensive Report: Ethical Issues in Financial Planning

This report explores the critical ethical issues within the financial planning industry. It begins by emphasizing the importance of financial planning and the need for ethical conduct among financial planners. The report identifies and elaborates on three core ethical concerns: integrity, objectivity, and confidentiality. Integrity is presented as a fundamental requirement, ensuring financial planners act honestly and avoid causing harm to clients' assets. Objectivity stresses the need for financial planners to prioritize clients' needs and risk profiles over their own interests, offering suitable investment products. Confidentiality is highlighted as a crucial aspect, requiring financial planners to protect clients' sensitive financial information. The report further discusses the role of educational institutions, such as ACU, in instilling ethical values and providing practical training to future financial planners. It outlines the ethical principles that ACU emphasizes, including integrity, objectivity, competence, fairness, confidentiality, and professionalism. The report concludes by underscoring the significance of maintaining high ethical standards to safeguard clients' financial well-being and promote trust in the financial planning profession. The report is contributed by a student and published on Desklib, a platform providing AI-based study tools.

Running head: ETHICAL ISSUES IN THE FINACIAL PLANNING
Ethical Issues in the Financial Planning
Name of the Student
Name of the University
Author’s note

1ETHICAL ISSUES IN THE FINANCIAL PLANNING
Table of Contents
Introduction................................................................................................................................3
Part 1..........................................................................................................................................3
Part 2..........................................................................................................................................6
Conclusion..................................................................................................................................9
Reference..................................................................................................................................10

2ETHICAL ISSUES IN THE FINANCIAL PLANNING
Introduction
The financial planning industry is an area the importance of which has not been
realised still now. The financial planning is very essential to frame the financial structure of
any individual. Th banks in the modern days has realised that with the emerging industrial
growth the industry is falling with the basic compliances that are required to be maintained in
the profession of financial planning. The financial planners does not following any ethics in
the profession, which leads to the falling popularity in the profession.
Part 1
In the modern days the major ethical issues become major concern for the financial planning
industry the three major issues that are related with profession of financial planning are stated
below;
Integrity
It is expected that the financial planner will behave with integrity and should neglect
the objectionable and harmful behaviour. The professional should not do anything that causes
damage to the personal assets of any individual. The individuals come to the financial planner
with the aim to have a financial increment and to create value of the wealth accumulated by
him. It will be very painful for the individual if he or she found that the financial planner does
not maintain any integrity while handling their assets and causes to their assets.so it is very
essential that the investment planner has worked with integrity and maintain moral code of
conduct while managing the wealth of the individual.
Objectivity
The major objective of the financial planner is to provide effective service to the
clients. The financial planner should give the clients the products that meets its demands. The

3ETHICAL ISSUES IN THE FINANCIAL PLANNING
risk taking capacity of every individual is not the same so after making proper analysis of the
portfolio of the customer the financial planner should give advice to the individual. The
objective should be to increase the value f the wealth of the individual and to see that it can
be possible for the individual to secure its future life with the wealth.
It is often found that the financial advisers try to manipulate the wealth of the
individual and suggest risky investment instruments that cause financial loss for the
individual. In place f protecting the interest of the individual the objective of the financial
planner to protect his own interest.
The ethics of the financial planner is to set the objective of protecting the wealth of
the individual and not to protect his own interest. It has become a major issue that the
financial planners by taking the advantage of the wealth of the customers they use to create
their own wealth. The objectivity issue has become a concern for which the financial planners
are losing the faith of the individuals, which results in to the fall of the demand of the
profession.
Confidentiality
The confidentiality has become major ethical issue in the profession of financial
planning. The customer on the ground of faith and trust give all the financial details to the
financial planner and believe that they will not breach the trust. The financial planner should
respect the faith of the clients. It is the basic principle of the profession is that they should not
disclose any confidential information of the client and should maintain ethics regarding this
matter. It is the duty of the financial planner to protect the confidentiality of his client
(Surendar and Sarma 2017).

4ETHICAL ISSUES IN THE FINANCIAL PLANNING
It has been observed that in many cases the professionals breach the trust of the client
and leak the financial information of the customers to any third party. This effects the client
and the client any have to suffer financial loss for that reason.
So the confidentiality is another ethical issue that the financial planner has to follow in order
to protect the interest of the client.
To avert the unethical practices of the financial planners it is required to impose more
strict rules that can protect the clients,. Strict actions are required to be taken in case any
financial planner is found guilty of breaching the ethics of the profession. It is required to
bring more awareness among the people about the importance of the profession and at the
same time, more emphasis is to train more people about the moral values that is associated
with the financial planning profession (Samsuri, Arifin and Hussin 2016).
The professionals should take this profession as an social responsibility and should act
in such a manner that it does not cause any harm to any individual. In future the financial
planning profession will be in high demand as people will become more cautious about
wealth creation to protect their future against uncertainties. So in future to bring the
profession to meet community and ethical standards it is required to set a ethical code f
conduct for this profession. An autonomous body is required to be created to set a particular
ethical code for the profession. This ethical code will bind all the professionals to follow the
same rule and that will bring more discipline in the profession (Resnik Elliott and Miller
2015).
The financial planning profession requires high ethical standard as it is directly related
with the financial condition of any individual. The profession also requires high standard of
skills also which will bring more assurance about the protection of wealth of the client. The
professional should behave ethically and with confidence so that the client does not feel that

5ETHICAL ISSUES IN THE FINANCIAL PLANNING
they will loss there wealth by taking the consultation of any financial planner (Ahmed and
Salleh 2016).
Part 2
ACU focus on financial management and financial planning
The importance of ethics is high in the field of financial management as finance
involves the management of other people capital. Clients always want to take the help of the
professional to increase the value of their wealth.so it is the basic principle for the students of
the financial planning is to give importance to protect the interest of the client and society
first and there after they can look for their own interest (Murphy, 2018).
Financial planning is a sector that teaches students about the process of increasing the
wealth of others and thereby helping the society and the community. Wealth is an essential
element of the growth of the economy and the more the value of the wealth increases the
more improvement in the economic condition of any country can be observed.
The ACU bachelor of finance degree opens the door of an exciting carrier for the
students. The demand for the profession of financial planning is increasing so it attract more
students to join the carrier( McDONALD, 2016).
Being the pioneer institutes it is the duty of ACU to teach the students about each and
every details of the ethical concern that are linked with the profession. The profession
requires high skills and knowledge that will find out the problems that the clients will face to
increase the value of their wealth. The profession requires knowledge that will analyse the
financial condition of the individual and will advise the individual to invest in the financial
instruments that best suits his or her profile (Johnsen, 2018).

6ETHICAL ISSUES IN THE FINANCIAL PLANNING
In the modern days, the financial sector is evolving with rapid pace. The financial
planning sector is heavily regulated so the profession of managing the investment portfolio
has become very complex and it needs strong ethical financial managers to help the
individuals and the entire society to enhance their wealth (Alviniussen and Jankensgard
2015).
The degree of ACU teaches the students about every laws and regulations that are
essential to protect the interest of the clients. It guides the students how to manage the
complex environment of the financial world, to generate more value for the clients, and to
create wealth for the society. The ACU combines accounting and finance principles and is
supported by ethical codes. The ACU will not only teaches the students about the tools of
financial planning but it also give knowledge about the broader aspect of the economy and
the process of financial decision making that will help the customers to get value of their
wealth (Fallaw, Kruger and Grable 2017).
In ACU the student will get the opportunity to participate in a variety of productive
learning experience. The students are allowed to run investment fund of the value of
1000000. The students will learn to develop the skills of problem solving teamwork and
marketplace skills and to understand the ethical issue that are related with the profession
(Bačová, et al 2017).
The basic objective of the institute is to think critically, act ethically, and solve the
problems of the customers. The main objective of this profession is to evaluate the financial
position of the individual and thereby take decision that in which way it will be possible to
increase the wealth of the client. The institute guides the students in this matter by giving the
students to work in practical environment and by taking the advantage, the students learn the
process of critical evaluation process. The students are placed in various internship programs

7ETHICAL ISSUES IN THE FINANCIAL PLANNING
that give them ample opportunity to make critical analysis of various cases which help them
to face the challenges that will come to them when they will face the real situation (Boisclair,
Lusardi and Michaud 2017).
Apart from the critical thinking, process the institute also teaches the students about
the ethical issues that are related with the profession. The main objective of the profession is
to give importance to the interest of the public and not to protect the interest of the
professionals. The world of finance is very complex and there are many rules and regulations
that are to be followed while managing the funds of the individuals. The main ethical
principles that the institute teaches to the students are enumerated below:
Integrity
Integrity should be the main behavioural characteristic of any financial planner . the
financial planner should not do any thing that may cause harm to the society and the client.
Objectivity
The main objective of the financial planner is to create value of the wealth of the
individual. The financial planner should advice the client to invest in that product which best
suits him or her. Based on the financial condition of the client the financial planner should
give his advice so that it can satisfy the requirement of the client (Dierksmeier and Seele
2018).
Competence
The financial planner should keep high level of knowledge and skill in order to give
advice to the clients. The financial planner should give advice only in that areas where it has
gain adequate knowledge and technical competent (Bodie 2015).
Fairness

8ETHICAL ISSUES IN THE FINANCIAL PLANNING
The financial planner should offer services so that it ensure fairness and reasonable to
clients and should disclose any conflict of interest in providing services (Stow, Rehman and
Karodia 2016).
Confidentiality
Confidentiality is the main ethical issue that the financial planner should maintain.
The client keep their faith on them and reveal all the financial information to the financial
planner. It is the responsibility of the financial planner to keep the information secret and not
to reveal the information to others. The financial information contains many record which can
create huge loss to the client if these are given to any third party. So maintaining
confidentiality is the major ethical duty of all the financial professionals (Mekonen Abraham
and Abraham 2016).
Professionalism.
The financial planner should always behave professionally. The conduct of the
professional person creates impact on the profession of financial planning. The financial
planner should always maintain professional approach while managing the wealth of the
clients.
Diligence
The financial planner should maintain all the diligence that are essential for the
improvement of its activities.
Conclusion
From the above discussion, it can be concluded that with the emerging demand of the
profession of financial planner it become inevitable for all the financial planners to maintain

9ETHICAL ISSUES IN THE FINANCIAL PLANNING
ethics in their profession. Every professional body in the world has its own code of ethics
based on which they work. Similarly, the financial planners should abide by the laws and
regulations that are essential to protect the interest of their client. It is the duty of the financial
planner to adopt efficient knowledge and to maintain the ethical behaviour while managing
the wealth of the customers.
Reference
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conceptual framework. International Journal of Islamic and Middle Eastern Finance and
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Alviniussen, A. and Jankensgard, H., 2015. Enterprise risk budgeting: bringing risk
management into the financial planning process.
Bačová, V., Dudeková, K., Kostovičová, L. and Baláž, V., 2017. Financial Planning for
Retirement in Young Adults: Interaction of Professional Experience, Knowledge, and
Beliefs. Studia Psychologica, 59(2), p.84.
Bodie, Z., 2015. Thoughts on the future: Life-cycle investing in theory and
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Boisclair, D., Lusardi, A. and Michaud, P.C., 2017. Financial literacy and retirement planning
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Brewster, D., 2016. Professional Resources.
Dierksmeier, C. and Seele, P., 2018. Cryptocurrencies and business ethics. Journal of
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10ETHICAL ISSUES IN THE FINANCIAL PLANNING
Fallaw, S., Kruger, M. and Grable, J., 2017, September. The Household CFO: Using Job
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Johnsen, Å., 2018. Impacts of strategic planning and management in municipal government:
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Samsuri, A., Arifin, T. and Hussin, S., 2016. Perception of undergraduate accounting students
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11ETHICAL ISSUES IN THE FINANCIAL PLANNING