Smith is a portfolio manager. $$A client tells informs Smith that he$/$she will compensate Smith beyond the compensation of the firm on the basis of the capital appreciation of the portfolio each year. $$Smith should:

Group of answer choices

Decline the compensation because it will create undue pressure on Smith to achieve strong short$-$term performance.

Decline the compensation because it will result in a conflict of interest with other clients' accounts.

Obtain permission from the employer prior to accepting the compensation.