Code of conduct and ethics

The RIA Code of Conduct establishes fiduciary duty — placing client interest first, always. Recommendations must be suitable (matched to goal, risk profile, constraints). Conflicts must be disclosed. Confidentiality must be maintained. Records of all advice must be kept for 5+ years for SEBI inspection.

Suitability has three legs: Know-Your-Client (gather information), product knowledge (understand what you recommend), reasonable basis (evidence-based selection). RIAs must document each leg for every recommendation. Disclosure: any conflict (group-company products, kickbacks, ownership interests) must be in writing before the advice is given. Records: client KYC, IPS, recommendation rationale, communication logs — all retrievable on demand. Grievance: client first complains to RIA; if unresolved, SEBI SCORES; arbitration via BASL is available.

A key 2024-25 SEBI guideline: written advice must include the rationale, alternatives considered, and rejection of those alternatives. "Buy XYZ Fund because we like it" is no longer compliant; "XYZ Fund chosen over ABC due to lower expense ratio, more consistent rolling returns, and better category fit; ABC rejected because of recent fund-manager change" is. RIAs increasingly use templates and CRMs to maintain this audit trail.