Code of Ethics Administration & System Utilization

OPPORTUNITY

In order to improve its operational efficiency, a $2B SEC-registered private fund manager purchased and implemented a compliance management system to assist in the administration of the firm’s code of ethics under Rule 206(4)-7 of the Investment Advisers Act of 1940.

Given a lack of adequate resources, senior management was concerned that compliance staff could not address the operational challenges of administering the system and were not utilizing the system in a consistent or efficient manner.

PROCESS

We assessed the current utilization of the compliance management system and provided recommendations for increased efficiency, transparent processes, and more insightful reporting. We then analyzed the system’s capabilities and implemented unused system modules, clarified certification language, developed desk procedures to facilitate system administration, and provided compliance system administration training to employees.

RESULTS

Written instructions and training allow staff to adopt the compliance management system quickly and consistently, while robust reporting capability and increased transparency bolster senior management’s confidence in the CCO’s ability to manage the firm’s compliance without additional resources.