The Compendium

Code of Ethics

The Code of Ethics is intended to assist Insolvency Practitioners meet the obligations expected of them by providing professional and ethical guidance. The Code applies to all Insolvency Practitioners who should take steps to ensure that it is applied in all professional work relating to an insolvency appointment, and to any professional work that may lead to such an insolvency appointment. Although, an insolvency appointment will be of the Insolvency Practitioner personally rather than her practice, she should ensure that the standards set out in this Code are applied to all members of the insolvency team.

There are five fundamental principles set out under the Code:

• Integrity
• Objectivity
• Professional Competence and Due Care
• Confidentiality
• Professional Behaviour

The Code adopts a ‘framework approach’, a method which Insolvency Practitioners can use to identify actual or potential threats to the fundamental principles and determine whether there are any safeguards that might be available to offset them.

There are five potential threats listed in the Code:

• Self-review threat
• Self-interest threat
• Familiarity threat
• Advocacy threat
• Intimidation threat

The Code sets out that an Insolvency Practitioner should act in a manner appropriate to his position as an officer of the court (where applicable) and in accordance with any fiduciary or other duties that he may be under.

Before agreeing to accept any insolvency appointment (including a joint appointment), an Insolvency Practitioner should consider whether acceptance would create any threats to compliance with the fundamental principles. Of particular importance will be any threats to the fundamental principle of objectivity created by conflicts of interest or by any significant professional or personal relationships.