A broker in the dictionary is defined as a go-between in making relationships or a middleman (for example, a stockbroker or an insurance broker). (Tennyson 8)
A broker is any person engaged in the business of effecting transactions in securities for the account of others. (Compliance Guide to the Registration and Regulation of Brokers and Dealers)
In general broker operates as an intermediary between different organizations or private people that are willing to cooperate as partners in a sustainable development initiative.
There are internal and external brokers. Internal broker is a person, who deals within a partner organization and organizes negotiations and general collaboration process between partners. External broker is an independent intermediary, a professional who works by a contract with one of the potential business partners in order to organize mutual cooperation with another company or person.
“Brokering is not easy and all brokers need to know what is expected of them – particularly how much or how little initiative they are mandated to take in their brokering role. They also need to know how often they should report back on their activities and to whom” (Tennyson 22)
One of the main responsibilities of all brokers is to prepare an effective contract agreement. Brokers will invariably be accountable to partners as well as to a line manager during the all process of cooperation. Broker deals on behalf of one of the partners, thus it is extremely responsible to act in the best way to achieve the target.
Among general broker’s duties to the business are the duty is to advise on and obtain a policy suitable to client’s needs. This includes: advising; explaining the consequences; indicating the reasons, which ought to be disclosed; taking reasonable actions to resolve the situation.All actions of brokers are regulated by the law. Therefore all brokers must be registered and get a license. Broker-dealers owe their customers a duty of fair dealing.
Broker-dealers must meet certain financial responsibility requirements, including:
- maintaining minimum amounts of liquid assets, or net capital;
- taking certain steps to safeguard the customer funds and securities; and
- making and preserving accurate books and records.( Compliance Guide to the Registration and Regulation of Brokers and Dealers)
Works Cited
Tennyson, Ros. The Brokering Guidebook 1899159 10 X (2005). The Partnering Initiative. Web. 2 Dec. 2014. <http://c.ymcdn.com/sites/www.gbsnonline.org/resource/collection/C6833BC0-02C0-42E2-8804-5FAB1D3B217B/BrokeringGuidebook.pdf>.
"Compliance Guide to the Registration and Regulation of Brokers and Dealers." SEC.gov. Web. 2 Dec. 2014. <http://www.sec.gov/divisions/marketreg/bdguide.htm>.
