"Conflict of interest" and disclosure

CFA General
#1

Hi,

I’m currently an associate PM at a boutique hedge fund. My boss is extremely anal, and just unpleasant when it comes to things like this so I’m unsure what to do. I’d like to transition into investment banking and as such I’ve sought out opportunities to help me do so. I’ve come across the perfect opportunity to work at a venture capital fund as a consultant, on my own time. The thing is, I know exactly how this plays out: I ask for permission, my boss says if you’ve got so much time why dont you invest it in our funds, and I either get fired, or accept defeat and she’s salty for the rest of my days here for even asking.

The thing is, I would be working at the VC for free. I would not be registered as an employee there, and I am not an employee here, but on a contract. Since one company invests in public companies, while the other invests in non-public, would this be a conflict of interest? Do I fail ethics here? I guess the question is… Can I just go about doing it on my free time and not disclose to the PM at the hedge fund?

Thanks

#2

Most firms require employees to disclose all outside professional activities, paid or not, so you would be violating your firm’s policy and therefore CFAI standards.

#3

I will review our PnP to confirm but:

If it’s not in our policies and procedures, does that still count as a violation of the standards?

If it is, what do you think is a good way to approach this situation? I guess I need to demonstrate that this will also add value to the firm.

#4

Will you receive any non-monetary compensation?

#5

A reference for my summer IB applications.

#6

Working for a woman is your problem. But she’s anal you say…hmmmm.

Don’t disclose. While the CFAI would like you to disclose your involvement in your kids cub scout troop to avoid any conflict of interest, it’s really none of their business. What one does freely outside of the company on their own time is their own business.

#7

If it will not disadvantage your employer (that includes distracting you enough that youre doing your job worse than if you did not engage in said professional activity) then you should be fine not disclosing, the conservative approach would be to disclose though

Woman PM is your problem. Managing money is like driving cars…women just can’t do it.

#8

I’d think you’re okay then (assuming your firm doesn’t require you to disclose). The only risk you would appear to have is if one of the VC’s portofolio companies IPOs and your current firm subscribes or buys in the open market, or even worse shorts it.