Driven by CFA Institute the Ethics Challenge is an annual competition for CFA charterholders and other investment industry professionals who will analyse a case study which contains a variety of ethical dilemmas. The Challenge is designed to increase the knowledge and awareness of ethics and ethical principles amongst industry professionals.
We believe that the Ethics Challenge will help to transform participants into future leaders, as it focuses on the following developmental goals:
Help participants gain ethical decision-making experience.
Expose participants to real-world ethical dilemmas.
Extend participants' professional networks.
Provide participants a platform to discuss and debate the importance of ethics.
Serengeti Advisory Services Case Overview
Overview:
Serengeti Advisory Services (Serengeti) is a Tanzanian equity research firm founded by three CFA charterholders: Fatima Bashar, Hasini Shah, and Amara Kariuki. Established five years ago, Serengeti specializes in equity research on small-to mid-cap African companies, selling subscriptions primarily to institutional asset managers in North America and Europe.
Services:
· Serengeti provides monthly research reports on listed African companies, supplemented by a new premium subscription offering additional reports chosen by clients for an extra fee.
· To expand coverage, Serengeti maintains an "approved list" of broker/dealers across Africa, partnering with them to enhance research capabilities and credibility.
Due Diligence and Compliance:
· Broker/dealers on Serengeti’s approved list undergo rigorous initial due diligence and annual follow-ups to ensure adherence to research quality standards.
· Serengeti encourages clients to trade through approved broker/dealers, fostering a referral system that incentivizes brokers to share insights.
Olatunji Financial Services Interaction:
· Amope Olatunji of Olatunji Financial Services (OFS) seeks inclusion on Serengeti’s approved list.
· OFS invites Serengeti's team to a West Africa Investment Forum in Lagos, covering all expenses, prompting discussion on ethical considerations regarding payment.
Ethical Considerations:
· During the forum, ethical dilemmas arise when Serengeti's Head of Business Development discovers confidential client information from OFS in a public area.
· Further ethical concerns emerge when OFS proposes opening a discretionary account for Serengeti’s CEO, offering to manage investments based on OFS recommendations.
Conclusion:
· Serengeti faces ethical challenges concerning client confidentiality, due diligence, and conflicts of interest.
· The firm must navigate these challenges carefully to maintain its reputation and ethical standards while considering partnerships and growth opportunities.