Ethics Flashcards
Please explain your understanding of the term conflict of interest?
A conflict of interest is where someone in a position of trust has competing personal or professional interests making it difficult for them to fulfil their duties impartially. An existing relationship will result in reduced impartiality and Chartered Surveyors have an obligation to make clients aware of this and if necessary decline work opportunities where a conflict of interest occurs.
How could the conflict of interest be managed internally if two separate departments were working for the same client?
Ensuring exclusivity of staff to each department.
Ensure separate communication lines are reporting back into the client.
Separate the geographical locations of each department.
Sign team members up to non disclosure agreements.
Monitor the potential conflict and keep the client updated.
If the client was insistent that you worked for them despite an existing conflict of interest, how would you proceed?
I would firstly check the clients understanding around the conflict of interest to ensure they understood the implications regarding the potential risk for reduced impartiality.
A letter of instruction to continue would be required from the client. I would then discuss the working procedures to manage the conflict of interest and agree this formally in writing with the client.
Please explain your understanding of the Main Principles of the Bribery Act?
Offences under the Bribery Act Include:-
Making a bribe.
Receiving a bribe.
Bribery of a foreign public official.
It applies to all UK Entities and includes associated persons.
Firms must ensure they can demonstrate the six principles of prevention are in place which are made up of:-
- Proportionate Procedures
- Top Level Commitment.
- Risk Assessments.
4 Due Diligence.
5 Communication.
6 Monitoring & Review.
Bribery Act - what year?
2010
Under the Bribery Act, under what circumstance is a facilitation payment permitted?
The only circumstance in which it is OK to make a facilitation payment is when you are under duress where there is a real and present risk or danger to “life, limb or liberty”. If you or your companions are under immediate physical threat you should put safety first, make the payment and report the matter immediately or as soon as is practicable to your manager or your ethics compliance contact.
You are attending a Main Contractor organised business conference where it is announced that you have been randomly selected as the winner of this months prize draw. It is an I-pad air of significant value. How would you act in this scenario?
I would be extremely uncomfortable accepting the prize in this scenario. The prize is of a significant value and could be interpreted as a bribe.
Furthermore due to working on a project with the Main Contractor at the time of this scenario, accepting the prize would have been highly inappropriate and could be interpreted as having an affect on my business conduct during the project.
I would respectfully decline the prize and suggest that this is made as a charitable donation to a charity of the Main Contractor’s choice.
I am aware that bribes are commonly distributed as random prizes and due to the seriousness of this incident I would report this to my line manager.
You receive an invite to attend the Theatre with some members of your Project Team but they dropped out due to illness at the last minute, would you still attend?
In the first instance I would declare this hospitality on my companies gifts and hospitality register. Assuming the invite was approved and I was authorised to attend, I would need to decline the invite due to the Project Team dropping out at the last minute as this would no longer be classed as a genuine business event.
You are bidding for a project and the client advises that if you reduce your fee bid by £3,000 you will be first place and win the tender, how would you advise the client?
This is an extremely sensitive issue in that this offer, if accepted would result in an unfair competition and would not be acting with integrity or with respect of competing firms. Taking a long term view, it is not sustainable to conduct business in this manner and would also devalue the services of the profession if repeated. I could advise that I would need to reduce my scope of services so that this is reflective of the fee reduction but in the first instance this offer from the potential client could also be interpreted as a bribe.
A client takes you out for lunch after a business meeting, where they continue to discuss business. The bill for the lunch comes to £200. What should you do now?
This lunch had a legitimate business purpose, so it’s fine to accept the hospitality however the client should have considered how a £200 bill for lunch could be perceived and have chosen a more modest restaurant. Given the size of the bill, it must be declared on the hospitality register and I would make my line manager aware immediately afterwards. I would offer to reciprocate but ensure this is carried out in a more modest manner as the lavishness of the restaurant could be interpreted as inappropriate and disproportionate.
A newly appointed project manager working for your Client’s organisation advises that they are concerned about the terms their predecessors agreed with you. They state not to expect the same terms and advise that if you give a 20% discount they will renew your contract. How would you respond?
Although this client is asking for a steep discount, it’s more a matter of them trying to renegotiate contract terms with us so this can’t be classed as a bribe. I would advise that we would consider offering the saving but the level of service and resource would need to be reviewed inline with the reduction. I would also evaluate if the original fees can still be considered as good value and a fair and reasonable sum. Providing this is still the case then any significant fee reduction would result in a devaluation of my services and profession. It may also not be sustainable and in the clients interests if I cannot provide a high standard of service that is required. A fee profile and resource schedule would need to be prepared to determine if the saving and adequate level of service can be offered. I may need to decline this opportunity if I am unable to offer the required level of service.
A contractor invites you to lunch to a restaurant and advises they’ve got two Michelin stars and a wine list second to none. They say they are keen to discuss the details of their tender they are about to submit for the project you are working on. How would you respond?
Going to what sounds like a lavish lunch paid for by a bidder in the middle of a tender process is against Company policy and could be an offence under the UK Bribery Act. If this were the first time, it would be OK just to decline and explain that such an invitation is inappropriate. However if the contractor is persistent and there is a red flag in that he wants to discuss things that he cannot put in writing, I would report this infringement.
What are the New Rules of Conduct?
Rule 1. Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
Rule 2. Members and firms must maintain their professional competence and ensure that services
are provided by competent individuals who have the necessary expertise.
Rule 3. Members and firms must provide good-quality and diligent service.
Rule 4. Members and firms must treat others with respect and encourage diversity and inclusion.
Rule 5. Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession.
