EVCA in ethics push

EVCA has announced that it is to launch a public consultation for a new code of ethics in the latest rear-guard action from an increasingly embattled industry. The new industry code is to be based on the International Organisation of Securities Commission model and will have six ethical principles at its heart, including integrity, fairness and respecting confidentiality. It should be fully implemented by all full EVCA members by January 2009. EVCA states that: "The litmus test for the application of these principles is the personal conviction of each individual member that their actions would stand up to third-party scrutiny."

Although some may question the credibility of a code with no monitoring or enforcement mechanism, self-regulation and a principles-based approach is a proven method of governance for the industry. However, there is a case for a monitoring force and AFIC, the French industry body, has led the way in this area with the introduction of an ethical commission with a mandate to scrutinise industry activity. The Commission de Deontologie was created in June when AFIC revised its ethical code, the Code de Deontologie l'AFIC, which is compulsory for all AFIC members to sign. The Commission de Deontologie has the power to issue warnings to AFIC members, suspend their membership or even ban them. The commission comprises 10 members elected for three years with a two-term maximum limit. The democratic nature of this process is in contrast to the BVCA, which has been criticised by some industry players for appointing rather than electing its chief executive. At an industry conference in Monte Carlo, Jon Moulton, while careful to avoid criticism of the current leadership, commented on the process: "It has never had an election and therefore has not been blessed with the power to speak on behalf of its members."

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