Propose practices and procedures that stop breaches of the ethics Code and the Standards of Professional Conduct before they occur

A code of ethics alone does not make an adequate compliance system. Adequate means written procedures fitted to the firm's size and business, communicated to staff, followed and periodically reviewed, supported by training and incentives that reward ethical conduct. When a supervisor learns of a possible breach, the steps are a prompt investigation and, pending its outcome, limits on or closer monitoring of the employee. A warning, a report to compliance or the employee's promise is not enough. Supervision may be delegated, but the supervisor must still instruct delegates on preventing and detecting breaches. If procedures are inadequate, the supervisor should raise it with senior management and recommend corrective action, and if clearly unable to supervise properly without them, should decline supervisory responsibility in writing until reasonable procedures exist.