It’s awards season, and no accolade is bigger than the Academy Awards, also known as the Oscars. It’s the night where the biggest and brightest stars shine, and the focus of the ceremony is who will win the categories from best actor/actress to best picture. “The envelope please, and the winner is ...” rings out from the stage. All the nominees wait with bated breath hoping their name will be called. Prestige comes with winning an Oscar. Another award though, not so prestigious, is the Golden Raspberry Awards or Razzie. It is a parody award given for the worst cinematic achievements of the year. Who would want one of those? 

Advisors who live by the code are all leading Oscar nominees for best actor in a leading role.

In our profession, we also strive to be shining stars and award winners — who has the most AUM, collected the most premiums or made Court of the Table or Top of the Table. Occasionally, by trying to win and to be the best, there may be areas where we are not following our global code of ethics completely. The MDRT Code of Ethics promotes the highest standards of our membership. Follow along with these scenarios that illustrate some of those tenets to see who is Oscar or Razzie worthy when it comes to behaving ethically. 

Dealing with vulnerable clients

An elderly widowed client called his advisor to withdraw $1,000 from his investments to help a friend. Two weeks later the client called again and wanted $10,000 more, again to send to a friend. The advisor becomes concerned, asks questions and learns that this money was going to be sent to the same friend.

So, the advisor told the client they need to meet in person to sign forms and then reached out to the client’s brother, who was a trusted contact, to attend the same session. There they learned that the client was sending money to a “friend” overseas that he met on a dating app. If the advisor merely complied with the client’s instruction rather than take those extra steps, who knows how much money the client would’ve lost. 

This advisor wins the Oscar for best performance for working in the best interest of the client. Must have been an MDRT advisor. A Razzie would have gone to the advisor who just followed the client’s instruction and didn’t watch out for fraud. Questioning clients when they ask for their money is not easy, but we as professional advisors need to be aware. 

Moral obligation

As financial advisors, we always hear that we should be the best for our clients, and that includes knowing our products inside out and conducting due diligence. But this duty shouldn’t be limited to just product knowledge. We also should be familiar with government regulations, keep our licenses updated and pay our tax obligations, among other responsibilities. We should be Oscar worthy for the best display of integrity category and always run our practice in a way that adheres to all legal, moral and contractual obligations. Just remember, “ignorantia legis neminem excusat,” meaning “ignorance of the law excuses no one” for breaking it.

Nominees for best fiduciary

How many times have you had a prospect ask, “Are you a fiduciary?” Although this is a valid question, most prospects don’t know what a fiduciary really is. The seven tenets of the MDRT Code of Ethics capture the legal and ethical elements of a relationship where an advisor is being trusted by a client to take care of their finances, assets and insurance needs. This code rises above the most basic definitions of a what a fiduciary does, and MDRT members have long been conducting themselves according to that standard. A very meaningful lesson taught by a mentor was “If you do what’s right for the client every time, everything else will take care of itself.” Advisors who live by the code are all leading Oscar nominees for best actor in a leading role. 

The reputation builder

When clients are asked what money means to them, their responses are typically freedom, security, etc. These responses are not financial terms but emotional ones. 

Advisors also have an emotional attachment to attaining future freedom and financial security, and the ability to attain these goals hinges on reputation. Consequently, we need to protect our reputation just like our clients ask us to help them protect their assets. Ethics are critical to an advisor’s reputation and adhering to the MDRT Code of Ethics brings clarity in instances when doing the right thing is challenged. Using the seven tenets and asking yourself if you have upheld them is an Oscar-worthy way of building and protecting reputation and guides us away from showing up in the Razzie awards for making the mistake of straying. 

The MDRT Code of Ethics is the baseline of value and standards that MDRT members bring to clients. Being a shining star in applying ethics provides peace of mind for us and leads to an Oscar performance for our clients.

MDRT Code of Ethics

MDRT members have a commitment to operate in an ethical and upstanding manner for the benefit of the public and the insurance and financial services profession. The Million Dollar Round Table’s Code of Ethics sets the standards for attaining this goal. Therefore members shall:

1. Always place the best interests of their clients above their own direct and indirect interests.
2. Maintain the highest standards of professional competence by seeking to maintain and improve professional knowledge, skills and competence.
3. Hold in strictest confidence and consider as privileged all business and personal information pertaining to their clients’ affairs.
4. Make full and adequate disclosure of all facts necessary to enable clients to make informed decisions.
5. Maintain personal conduct which will reflect favorably on the insurance and financial services profession and the Million Dollar Round Table.
6. Determine that any replacement of an insurance or financial product must be beneficial for the client.
7. Abide by and conform to all provisions of the laws and regulations in the jurisdictions in which they do business.

Scan to read available Round the Table articles in the members-only MDRT App.