Can ethics be taught in schools

A New York Times article revealed that university students frequently use AI tools without disclosure, despite recognizing the ethical risks to their careers. A US professor of organisational psychology discussed how to persuade students to choose the more ‘morally correct’ option in cases where it seemed far easier to cheat, at no obvious cost to themselves. He found that when students develop strong moral identities, they view unethical behaviour as a violation—not just of the rules but also of their own values. The best way to instil this was to teach students about those values so they consistently thought about the ethical consequences of their actions.

During the early 2000s, ethical considerations in financial planning received minimal attention. The Financial Planning Certificate (FPC) exams, which I took in the late 1990s, prioritized technical knowledge—pension structures, bond mechanics, unit trust regulations, and compliance boundaries. No ethics components existed in the curriculum. Those who adhered to ethical standards did so out of personal conviction rather than formal instruction. Ethics were not seen as something that needed to be taught.

Insofar as there were advisers who operated by an ethical code with their clients, it was imported by them from outside the financial services industry rather than being created by it. It was a by-product of their upbringing, of their underlying values as human beings, rather than something forming an integral part of their training. Sadly, this also meant the boundaries of any code were elastic enough to permit behaviours from some that, as anyone with half a brain could have predicted, led to millions of consumers sustaining significant harm from the mis-selling of financial products.

Ethics Now Mandatory in UK Financial Training

Starting in the early 2000s, UK financial planning qualifications underwent a transformation. The Certificate in Financial Planning, introduced after 2005, incorporated ethics as a required subject. Today, the CII’s Diploma in Regulated Financial Planning mandates R01: Financial Services, Regulation and Ethics as its first module. Practitioners must also renew their Statement of Professional Standing (SPS) annually, committing to a Code of Ethics and fulfilling Continuing Professional Development (CPD) requirements that include ethics-focused modules. The shift reflects a broader recognition that ethics cannot be treated as an afterthought but must be embedded in the foundational knowledge of financial advisers, ensuring it influences their approach from the outset.

Assessing the effectiveness of these changes remains difficult, but a 2020 study in the Journal of Financial Economics analyzed over a million US advisers who sat for Series 66 exams administered by the Financial Industry Regulatory Authority (FINRA) after ethics content was expanded in 2010. The study compared advisers with the same employer in the same location and year and found those passing the exam with more rules and ethics coverage were one-fourth less likely to commit misconduct.

Even three years later, advisers who received more ethics education committed fewer violations than their colleagues who received less training. The paper also looked at statistics involving advisers leaving firms where they had concerns about corporate ethics. It found that departures of advisers who had passed an ethically-based exam was a predictor of scandals at their former employer.

How Strong Ethics Training Benefits Clients and Firms

Better-trained advisers who have been taught to act according to an agreed moral and ethical code do better for their clients, and ultimately, themselves. Who knew?

The UK’s adoption of ethics requirements reflects a broader industry evolution. Previously, advisers relied on personal judgment, or ignored ethical concerns entirely. Now, maintaining professional credentials depends on proving an understanding of ethical standards. The question is whether this shift has bridged the divide between ethical theory and real-world application. The lack of empirical UK data means the full impact remains speculative, but the US findings suggest that formal ethics instruction can reshape professional behavior over time.