The Farm Credit Administration (FCA) last month issued a final rule governing the standards of conduct (SOC) of directors and employees of Farm Credit System institutions (System Institution). The rule excludes the Federal Agricultural Mortgage Corporation (Farmer Mac). The final rule requires each System Institution to have a Standards of Conduct Program to create performance criteria to provide an effective safety and soundness framework. The final rule has four objectives, “(i) Establish principles for ethical conduct at System institutions; (ii) Enhance Standards of Conduct Programs using core principles; (iii) Require each System institution to adopt a Code of Ethics; and (iv) Encourage and enhance ethical behavior within the Farm Credit System.” The rule went into effect on October 13, 2021.
The FCA noted that during the comment process commentators were worried about the burden that they would take on in trying to implement these new mandated policies. The FCA states that the flexibility of the rule should make the implementation less burdensome on the commentators.