CTRL 3.1.18 Specific obligations — avoiding or mitigating conflicts of interest

(1) An authorised firm’s governing body must ensure that each part of the firm’s corporate governance framework, and of its risk management framework, is designed:
(a) to avoid conflicts of interest (or to mitigate such conflicts if it is not possible to avoid them); and
(b) to deal effectively with any conflict of interest that arises.
(2) The frameworks must require that:
(a) any conflict of interest that arises must be reported:
(i) to the firm’s senior management, or, if the firm is a branch, to the body that is responsible for the branch; and
(ii) if it is not addressed within a reasonable time by the senior management, to the firm’s governing body; and
(b) every 6 months, the firm’s senior management must give the governing body a written summary of all conflicts of interest addressed by the senior management during the period.
(3) In this rule and rule 3.1.19, a reference to a firm’s governing body is a reference to the board, membership, committee or body (whatever it is called) that is responsible for the firm’s corporate governance framework and risk management framework in relation to conflicts of interest and periodic review.

 

Derived from QFCRA RM/2020-4 (as from 1st July 2021)