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March 4, 2026
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Understanding and being able to apply appropriate ethical and professional standards is a critical skill for a successful CFA® charterholder. The Ethical and Professional Standards topic on the CFA Level I exam is substantial and continues to be for each exam level.
Start off by reading Schweser’s CFA Level I SchweserNotes and watching the Module Videos alongside these, as the explanations will really help bring the material to life which will be imperative for your exam technique.
You must read the Standards of Practice Handbook from beginning to end and it would be sensible to reread this just prior to your exam too.
Practice as many questions as you can while checking your understanding, retention, and application. It can’t be emphasized enough, if you neglect the question practice, it will be like going into a driving test never having sat in a car before, but just having read about them.
Learning Outcome Statements while studying for a CFA exam refer to specific skills and concepts you should possess within an exam topic whereas exam topics describe the broader body of knowledge you should have. For example, the Ethical and Professional Standards exam topic at Level I has lots of LOSs that you’ll need to learn
An example of a CFA LOS for Ethical and Professional Standards is “describe a framework for ethical decision making.”
Learn about preparing for Ethics on the CFA exam.
As a candidate for the CFA designation, you are bound by the Code of Ethics and Standards of Professional Conduct. It is therefore your responsibility to ensure you understand the content and can apply it to different scenarios, understanding whether an action is a violation, and giving appropriate advice. While they may be fictional scenarios in the exam, it is likely you will come across a wide range of these during your career.
The Ethical and Professional Standards topic represents 15-20% of the Level I exam, meaning approximately 27-36 questions. It is the first topic to be tested in the morning session and is tested standalone (before moving onto the Tools Functional Area which covers Quantitative Methods, Economics, and Financial Statement Analysis).
The content of the Code and Standards should not be tricky to understand, however, the skill across all three levels is being able to apply what you have learned to scenarios. Ethics and Professional Standards is historically a challenging curriculum topic for under prepared candidates.
The key to this is question practice, question practice, and more question practice. Don’t underestimate the importance of keeping this practice ticking along while you get bogged down in other more technical curriculum areas.
Ethical and Professional Standards is the final syllabus topic so if you are following the readings chronologically, this will be the last one you study for. It may be sensible to take a brief look at it (reading the SchweserNotes and watch the Module Videos, for example) to understand what you have to come, but it will be crucial to revisit it multiple times in the run-up to your exam.
Below are overviews of each Level I Ethical and Professional Standards reading and what you are expected to learn.
What is ethics, and ethical behavior and why does the profession need a code of ethics? All of these are covered in this reading. While short, it sets the scene for readings to come and does contain testable material.
The Code of Ethics identifies six components which are mandatory behaviors for members of the CFA Institute and candidates for the CFA designation to follow, and there are seven Standards of Professional Conduct. These are all listed in this reading, and you will be expected to know the ethical responsibilities required by each section.
The Code and Standards introduced in the previous reading and discussed in more detail here, which provide more examples to help a candidate demonstrate how to apply the Code and/or Standard, recommend practices and procedures to prevent violations, and identify conduct that confirms or violates the relevant Code and/or Standards.
It’s likely the majority of the exam questions will draw on skills learned in this reading alongside the final reading of the topic.
Compliance with GIPS for firms reporting investment performance is voluntary, and for Level I you are expected to know why they were created, who can claim compliance, and who benefits from compliance. This reading will explain the key concepts, and how a firm can verify compliance.
Using the knowledge from the ‘Guidance for Standards I-VII’ reading, this reading gives detailed scenarios to illustrate how the Code and Standards is (or is not) applied in practice.
Answer these five questions to test your readiness for the Level I Exam.
Theoretically, there is nothing stopping you from passing CFA Level I if you fail the Ethical and Professional Standards topic. You will of course have to compensate and score highly in the other areas though.
The danger comes if you are sat at the borderline between passing and failing, in which case Ethical and Professional Standards becomes one of the key deciding factors for the CFA Institute, and the examiners won’t look too fondly on someone who has not passed this topic area.
Ethical and Professional Standards is 10-15% of the Level II exam, and the same again for Level III. As noted above, this is a crucial area to be able to score well in.
The Code of Ethics and Standards of Professional Conduct are ultimately the same as at Level I, and the focus of the exam questions is again on applying your knowledge to a scenario. However, the questions will likely be even more nuanced at Level II - questions are presented in item sets, meaning 4 separate questions will all relate to one scenario.
Looking for more guidance on how to prepare for Ethical and Professional Standards? Enroll in one of our CFA Level I Premium study packages to receive expert instruction, CFA Program study materials, and more. Give yourself the best chance to prepare, practice, and perform on the CFA exam.
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