Ethical rules of conduct for employees working at Financial Supervisory Authority

Introduction

The ethical rules of conduct apply to all Financial Supervisory Authority (FIN-FSA) employees, including the Director General, whose employment is administered by the Bank of Finland (hereinafter "FIN-FSA employees").

On 12 March 2015, the Governing Council of the European Central Bank adopted a Guideline laying down the principles of an Ethics Framework for the Single Supervisory Mechanism (ECB/2015/12). The national competent authorities shall take the necessary measures to implement the Guideline. The principles referred to in the ECB Guideline are contained in these ethical rules of conduct for employees working at Financial Supervisory Authority, staff guidelines on securities trading and insurance investments as well as the guideline for persons subject to the insider disclosure obligation.

Independence and avoidance of conflicts of interest

FIN-FSA employees are expected to refrain from any activities which may present a conflict of interest with respect to FIN-FSA and the conduct of the employee's duties. If a conflict of interest does arise, the employee must so notify his or her supervisor without delay.

A conflict of interest refers to a situation where employees' personal interests may influence or appear to influence the impartial and objective performance of their duties.

Personal interest refers to any benefit or, actual or potential benefit, of a financial or non-financial nature, for employees, their family members and other relatives or for their circle of friends and close acquaintances.

Before a new person is appointed to a position, the employee responsible for the appointment at FIN-FSA must ensure that the applicant makes notification of any such conflicts of interest during the application procedure and assess, before the appointment is made, whether the applicant's previous duties or personal relations could pose conflicts of interest with respect to the performance of official duties. FIN-FSA employees shall inform their supervisor in case a new task might cause a conflict of interest or a conflict of interest arises during a leave of absence.

Gift, other advantage and hospitality

According to the law, an official shall not demand, accept or receive a financial or non-financial advantage if it may undermine trust in the official or in the FIN-FSA1.

FIN-FSA employees shall not request, receive or accept, for themselves or other persons, advantages connected in any way whatsoever with the tasks or duties conferred upon them.

An advantage refers to any gift, hospitality or other benefit of a financial or non-financial nature which objectively improves the financial, legal or personal situation of the recipient and to which the recipient is not otherwise entitled.

Advantages of a customary or negligible value are an exception. Gifts not exceeding EUR 50 in value may be deemed customary. If a particular situation does not allow a gift in excess of EUR 50 to be rejected, the gift must be handed over to the FIN-FSA, unless any excess above EUR 50 is paid to the FIN-FSA.

Advantages may not be frequent or from the same source. An advantage may not influence nor be perceived as influencing the independence and impartiality of an employee. Hospitality of a customary nature offered in the context of cooperation with other authorities, central banks, European Union institutions or international organisations may be accepted. Restraint should be practiced in respect of acceptance of even minor hospitality from a supervised entity, in connection with an inspection at the supervised entity or listed company or the handling of a matter related to an individual supervisory case.

FIN-FSA employees shall neither host nor give, at the expense of the FIN-FSA, any other benefits to each other, unless otherwise permitted under a practice separately agreed upon.

Acceptance of invitations and other participation in events by external organisers

Bearing in mind their obligation to respect the principle of independence and avoid conflicts of interest, FIN-FSA employees may accept invitations to conferences, receptions, cultural events and other meetings or occasions, including the appropriate hospitality, if their participation in such events is compatible with the fulfilment of their duties or is otherwise in the interest of FIN-FSA.

As a general rule, the FIN-FSA pays the travel and accommodation costs incurred by such employees, who shall not accept remuneration for lectures or speeches given in an official capacity.

These rules shall apply equally to the spouses of such employees if the invitations are also extended to them and if their participation is consistent with internationally accepted custom and approval for their participation has been obtained from the department head or director general. The chairman of the Board shall approve participation by director general.

Acceptance of remuneration for activities undertaken in a personal capacity

FIN-FSA employees may undertake teaching and scholarly activities or pursue other activities within the limits of the rules for secondary occupations. They may accept remuneration or compensation for activities undertaken in a personal capacity, unless otherwise provided by law and on condition that the remuneration or compensation is commensurate with the work performed and remains within customary limits. Such activities include writing of articles and giving of lectures which can be deemed to have been prepared outside working hours.

FIN-FSA employees shall report on their secondary occupations and remuneration received to the Ethics Adviser of FIN-FSA, annually.

Credit, insurance, services and products

The terms and conditions of credit, insurance, services or products received by an FIN-FSA employee from supervised entities shall be in compliance with the terms and conditions applied to the general public. FIN-FSA employees, their spouses, as well as underage children or other legally incompetent persons in the trusteeship of such employees may not accept unjust enrichment from supervised entities.

Compliance with rules concerning securities trades

FIN-FSA employees shall be governed by FIN-FSA's current insider policy and trading rules.

An FIN-FSA employee may not acquire securities issued by supervised entities or other financial corporations established within the European Union or make short-term investments in other securities. The trading rules list, with more details, the securities that are exempt from the restrictions and acquisition prohibition. It is also recommended that such an employee should not acquire securities of such a foreign supervised entity operating in the financial markets as has a branch in Finland or whose subsidiary is FIN-FSA's supervised entity. Acceptance of securities by way of inheritance, partition or gift does not violate these ethical rules of conduct.

FIN-FSA employees may not make short-term investments in securities subject to public or multilateral trading in Finland.

In buying or selling securities, an FIN-FSA employee shall consult FIN-FSA's Compliance Officer (CO).

Lack of impartiality and other conflicts of interest

An FIN-FSA employee lacking impartiality shall disqualify himself/herself from participating in the preparation, presentation or decision-making of the relevant matter.

FIN-FSA employees shall disqualify themselves from handling their own matters, or those of their closely related persons. Closely related person refers to a person defined in section 28, subsections 2 and 3 of the Administrative Act (434/2003). Similarly, such an employee is ineligible if his or her impartiality is endangered for any other reason.

Such an employee shall, without undue delay, notify his/her superior if he/she has been chosen for a new job.

If an FIN-FSA employee is joining the service of a supervised entity, he or she must be transferred by his or her supervisor without delay to such duties as do not deal with confidential information regarding the future employer or other supervised entities.

Approval procedure in exceptional cases

In case of doubt about the practical application of any ethical code confirmed by these rules, an FIN-FSA employee shall turn to the Ethics Adviser in order to ensure uniform application of these rules. The Ethics Adviser may approve exceptions to these rules in individual cases, if necessary, provided the matter is minor and not in violation of the general principles of these ethical rules of conduct.

In all other cases, the power of decision for approval of exceptions lies with the Director General and similarly, in matters concerning the Director General, with the chairman of the Board.

Ethics Adviser

Further information on the ethical rules of conduct is provided by the Ethics Adviser.

The ethics adviser to the Director General is the Secretary of the Parliamentary Supervisory Board. The ethics adviser to other FIN-FSA employees is the Secretary of the Management Group.

1) Act on the employees of the Bank of Finland, section 12.

 

 

16 August 2016

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