What must a CFA Institute member inform their employer about when engaging in independent practice?

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When a CFA Institute member engages in independent practice, it is critical that they inform their employer about the expected compensation. This is important because the CFA Institute emphasizes the necessity of transparency and the avoidance of potential conflicts of interest. By disclosing the expected compensation, a member ensures that their employer is aware of any outside financial arrangements that could potentially impact their work or create a conflict.

The obligation to inform the employer is rooted in ethical standards that aim to maintain professional integrity and uphold the trust placed in members by their employers. It is not sufficient to only disclose the types of services to be rendered without addressing the associated compensation, as this could lead to misunderstandings or unethical situations whereby the member's judgment might be compromised due to undisclosed financial relationships.