CFA Institute Launches CFA Centre for Financial Market Integrity; Advisory Council to be Chaired by John Neff; Asset Manager Code of Professional Conduct Unveiled.

CHARLOTTESVILLE, Va. -- CFA Institute, the non-profit professional association that created and administers the prestigious Chartered Financial Analyst(R) (CFA(R)) program worldwide, announced the establishment of a new research and policy center called the CFA Centre for Financial Market Integrity.

The CFA Centre was created to develop timely, practical solutions to global capital market issues, while advancing investors' interests by promoting the highest standards of ethics and professionalism within the investment community worldwide.

A new advisory council, chaired by John Neff, CFA, has been formed to guide the work of the CFA Centre for Financial Market Integrity worldwide. The council consists of Neff and six other industry leaders from three continents: Gary Brinson, CFA; Alan Brown; Jelle Mensonides; John Stannard, CFA; Walter Stern, CFA; and Amy Yip.

The CFA Centre will have staff in New York, London, Hong Kong and Charlottesville, Va.

As the first executive director of the CFA Centre for Financial Market Integrity, CFA Institute has hired Kurt Schacht, JD, CFA. Schacht previously served as chief operating officer and general counsel in the hedge fund and mutual fund industries. Prior to that, Schacht was chief legal counsel for a large U.S. public pension fund, where he was responsible for managing all corporate governance programs. Schacht will be responsible for managing all aspects of the CFA Centre's efforts to develop, promote and maintain the highest ethical standards for the global investment community.

"We are proud to announce the opening of the CFA Centre for Financial Market Integrity to serve as a leading voice on major emerging issues in the global financial markets," said Thomas A. Bowman, CFA, president and chief executive officer of CFA Institute. "The past few years have brought increased scrutiny from the public and regulators to our industry, and the importance of ethics and protection of investors' interests has never been greater."

Established by CFA Institute as a distinct division with its own executive director and advisory council, the CFA Centre will build upon CFA Institute's 40-year history of standards and advocacy work, especially its Code of Ethics and Standards of Professional Conduct for the investment profession, which were first established in the 1960s. CFA Centre will take a leadership role on key issues affecting the integrity of capital markets around the world, including:

--ethical standards,

--financial reporting quality, such as the expensing of stock options,

--market fairness, openness and transparency

--competent, fair and efficient investment practice

--research objectivity,

--trade execution, and

--investment performance standards.

Jeffrey Diermeier, CFA, a member of the CFA Institute Board of Governors, said, "Based upon real-world input from industry experts and our membership base of 75,000 investment practitioners in 120 countries, the CFA Centre will develop practical solutions and provide a unique global perspective to address pressing issues in the investment industry."

"The core guiding principle of the CFA Centre is that all market participants have an ethical responsibility to place the interests of investors first," said Diermeier, who will become president and CEO of CFA Institute upon Bowman's retirement at the end of December. "We advocate for the best interests of investors and the investment professionals who serve them -- a perspective that is often under-represented and under-appreciated in public policy debates."

An independent advisory council made up of renowned industry leaders will guide the CFA Centre. The advisory council members were selected for their commitment to personal high ethical and professional standards, their knowledge of financial industry issues and their ability to identify and develop new policies and initiatives.

The advisory council is composed of the following seven distinguished individuals from the U.S., Europe and Asia:

--Gary Brinson, CFA, (Chicago) the founder and retired chair of Brinson Partners, is a nationally recognized authority on global investing. As an advocate and pioneer in allocating assets across a variety of investments in the 1980s, Brinson is credited as having a major impact on investment practice. In 1999, Brinson was the recipient of the CFA Institute Award for Professional Excellence.

--Alan J. Brown, (London) is group chief investment officer and vice chairman of State Street Global Advisors worldwide, and executive vice president of State Street. Brown joined State Street in January 1995 and has over 29 years of experience. He has spent the majority of his career in the investment management business developing and applying quantitative strategies to portfolio management.

--Jelle Mensonides, (Netherlands) has been chief investment officer, alternative investments, at ABP Investments in the Netherlands. On Jan. 1, 2005, he will start as chief executive officer of ABP Investments US Inc. in New York. Previous roles at ABP, which he joined in 1992, include director of equity investments and real estate.

--John B. Neff, CFA, (Radnor, Pa.) chair of the CFA Centre Advisory Council, was manager of Vanguard's Windsor Fund for 31 years, which Neff grew to become the largest mutual fund in the world by investing in companies with solid intrinsic value. Having served as managing partner, senior vice president and a member of the executive committee at Wellington Management Company, Neff formally retired in 1995. He received the prestigious Award for Professional Excellence from CFA Institute in 1995 and served on the CFA Institute Board of Governors from 1996 to 1999.

--John C. Stannard, CFA, (London) is managing director of client communications and support for the Russell Investment Group in Europe, a global investment services organization. Stannard has been a member of the CFA Institute Board of Governors since 2002 and currently serves as vice chair of the board. In 1999, he began serving as the first chairman of the CFA Institute-sponsored global Investment Performance Council, overseeing development and promulgation of Global Investment Performance Standards, or GIPS(R), which have been adopted by firms in 30 countries.

--Walter P. Stern, CFA, (New York) is associated with Capital Group Companies, Inc., a large investment management firm. He is chairman and a director of Capital International, Inc. and vice chairman of Capital Group International, Inc. He also serves as chairman of the New Perspective Fund and the Emerging Markets Growth Fund, both global funds.

--Amy Y.T. Yip, (Hong Kong) is executive director of the Hong Kong Monetary Authority, where she is responsible for the investment management of the Exchange Fund. Prior to joining the Hong Kong Monetary Authority in 1996, Yip worked at JP Morgan, Rothschild Asset Management and Citibank.

"I am pleased to be a part of CFA Centre and look forward to working with our advisory council to help create a better investment environment," said John B. Neff, CFA. "Although enforcement plays a vital role in building market integrity, there is, I believe, a higher 'calling,' if you will, to promote and encourage voluntary adherence to high ethical standards. The CFA Centre will work to provide practical, ethical guidance and to promote a culture of ethics among investment practitioners and firms everywhere."

Asset Manager Code of Professional Conduct

The first initiative of the CFA Centre is an exposure draft of a new Asset Manager Code of Professional Conduct that sets forth global ethical and professional standards for firms managing assets as separate accounts or pooled funds, including hedge funds. The code provides specific, practical guidelines for asset managers in six areas: loyalty to clients, the investment process, trading, compliance, performance evaluation and disclosure.

"Managers who may not already have a code in place may use the Asset Manager Code of Professional Conduct as a template to foster a culture of ethics and professionalism within the firm," said Schacht, executive director of the CFA Centre. "By adopting and enforcing the code, managers will demonstrate to investors their commitment to high ethical standards, building investor trust while protecting the reputation of their firm."

The CFA Centre for Financial Market Integrity seeks written public comment on the exposure draft of the Asset Manager Code of Professional Conduct by Dec. 31, 2004. Comments should be addressed to [e-mail].

About the CFA Centre for Financial Market Integrity

The CFA Centre for Financial Market Integrity is the research and policy center of CFA Institute, the global, non-profit professional association that administers the prestigious Chartered Financial Analyst(R) (CFA(R)) program worldwide. Created to develop timely, practical solutions to global capital market issues, the CFA Centre advances investors' interests by promoting the highest standards of ethics and professionalism within the investment community worldwide. Past standards and guidelines developed by CFA Institute - standards that will now be overseen by the CFA Centre for Financial Market Integrity - include the Global Investment Performance Standards (GIPS(R)), AIMR-Performance Presentation Standards (AIMR-PPS(R)), Research Objectivity Standards, Soft Dollar Standards and Trade Management Guidelines.

About CFA Institute

CFA Institute is the global, non-profit professional association that administers the CFA curriculum and examination program worldwide and, through the CFA Centre for Financial Market Integrity, sets voluntary, ethics-based professional and performance-reporting standards for the investment industry. CFA Institute has 75,000 members in 120 countries. Its membership includes the world's 62,000 CFA charterholders, as well as 130 affiliated professional societies in 51 countries and territories. CFA Institute is headquartered in Charlottesville, Va., USA, with additional offices in London and Hong Kong. CFA Institute was known as AIMR (Association for Investment Management and Research) from 1990 to early 2004, and before that was two separate organizations whose roots go back to 1947. More information may be found at www.cfainstitute.org or by calling 1-800-247-8132 or 1-434-951-5499.

Note to Editors:

The Chartered Financial Analyst(R) (CFA(R)) program is a globally recognized standard for measuring the knowledge and commitment of investment professionals. Those who have earned the CFA charter have completed a rigorous, three-year course of independent study that includes three sequential, six-hour exams on securities analysis, financial accounting, quantitative analysis, economics, portfolio analysis, ethics and professional standards. "Chartered Financial Analyst(R)" and "CFA(R)" are trademarks owned by CFA Institute. Therefore, "Chartered Financial Analyst" should always be capitalized, and both the full name and the letters CFA should be used as adjectives to qualify nouns. It is also appropriate as a three-letter designation after an individual's name. Examples: "James Smith, CFA"; "He holds the Chartered Financial Analyst designation"; "The Chartered Financial Analyst program"; "He earned the CFA charter"; "As a CFA charterholder, he..." The most common misuse is to refer to an investment professional as "a chartered financial analyst" or "a CFA."