Ethics - Conflicts Of Interest 1 Flashcards
What is a conflict of interest?
A conflict of interest arises when a member or firm’s independence and impartiality is threatened due to the existence of a conflict between two clients.
Examples include:
Any financial interest, A personal interest, Commercial relationships, Acting on both sides of a transaction
What is the difference between conflict avoidance and conflict management?
Conflict avoidance is when you do not accept the instruction. Conflict management is when the instruction is accepted, and steps are agreed and put in place to manage the conflict, such as an information /ethical barrier, with the written agreement of all parties
What is the RICS Global Professional Standard regarding conflicts of interest?
The standard states that ‘a Member must not advise or represent a client where doing so would involve a conflict of interest or a significant risk of a conflict of interest, other than where all those who are, or may be affected have provided their informed consent’. Informed consent may only be sought where the RICS member or regulated firm is satisfied that proceeding despite a conflict of interest is in the interests of all of those who are or may be affected and is not prohibited by law’ (RICS, 2017)
What are the three types of conflicts of interest defined?
The three types are:
- A ‘Party Conflict’ relating to work on the same or related instruction for two different parties
- An ‘Own Interest Conflict’ relating to a personal interest
- A ‘Confidential Information Conflict’ relating to work between two parties that is confidential
What is informed consent?
Informed consent can only be given in writing by the party if the person explaining the position to them is entirely transparent about any material factors and sure that the party affected understands what they are doing. Surveyors should only seek informed consent if satisfied that all relevant parties are best served by doing so
What are some key areas of the Professional Standard regarding conflicts of interest?
All conflicts must be managed in accordance with the Professional Standard. Every RICS firm must have in place effective systems and controls appropriate to the size and complexity of their business to ensure full compliance. All firms must keep records to show their compliance with the Standard
